Based on the recent AT&T-Bell-South merger, it would be easy to see AT&T as a phoenix, rising from the ashes once again to dominate every aspect of communications in America. That is not likely to happen.

Two stories support a scenario for the reemergence of one giant telecommunications company. The first holds that larger telecommunications firms always have lower average costs. If that were true, telecommunications firms would efficiently consolidate into one firm — or as few firms as the government would permit. The second theory holds that there are substantial economies in jointly owning different types of telecommunications services, particularly wireline and wireless services. Both stories are wrong.

To see the absence of global efficiencies from increased size, consider the recently announced deal between Verizon and Fairpoint Communications. Fairpoint, based in Charlotte, N.C., will acquire most of Verizon’s wired assets for residential customers in Maine, New Hampshire, and Vermont. In this particular instance, Verizon perceives that it will become more efficient not by growing larger, but by shrinking.

Large telecommunications firms have both acquired and shed territories over the past decade. The acquisition campaigns of AT&T and Verizon — as well as cable companies Comcast and Time Warner — have been widely publicized. Less well known is their selling of assets. For example, in addition to the Fairpoint divestiture, Verizon sold some rural exchanges to Valor in 2000, most of its Hawaii holdings in 2005 to Hawaiian Telecom, and its Puerto Rico operations to América Móvil in 2006. AT&T, Qwest, and Verizon have shopped other rural assets as well.

While AT&T, Verizon, and Qwest focus their attention on major metropolitan markets, literally hundreds of smaller, primarily telephone companies vie for geography and customers in the remainder of the country. There is no basis to conclude that all phone companies will merge into a large, monolith the coming years. Overall, the number of traditional access lines has been falling in recent years from competition with wireless and broadband services.

The emergence and growth of different providers of communications services outside of traditional telephone companies further disproves the theory that one or a few firms can efficiently offer all telecommunications. In addition to the traditional telephone companies, the landline telecommunications industry now includes cable companies offering both video and telecommunications services, dozens of smaller competitive overbuild companies such as RCN, and Internet-based companies such as Google and Vonage that offer communications services over broadband. Even greater competition for wireline services has come over the past 20 years from rapidly growing wireless companies.

A second widely discussed theory is that combining wireless and wireline capabilities is necessary for a successful telecommunications company. This is clearly false as most firms have been unsuccessful in gaining efficiencies from the combination. Last year, Sprint became a purely wireless company by spinning off its landline business as Embarq.

As a result, other than AT&T and Verizon, the largest wireless phone companies in America no longer have wireline assets. Conversely, most major wireline companies — including traditional telephone companies such as Qwest, and cable companies such as Comcast and Time Warner — have no wireless assets.

In the early 1980s, AT&T economists articulately argued that one firm was the most efficient provider for all telecommunications services. Today, some observers worry that the new AT&T is attempting to resurrect the once monolithic firm that literally monopolized every aspect of communications in America. But technology and market structure have changed irreversibly, and market transactions clearly reveal that no single firm can be the most efficient provider. Where there was once but one firm, tomorrow there will be many.

A former FCC commissioner, Mr. Furchtgott-Roth is president of Furchtgott-Roth Economic Enterprises. He can be reached at hfr@furchtgott-roth.com.