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The last 12 months have proved to be both turbulent and transforming for the telecom industry. Long-awaited regulatory decisions followed by major mergers and the explosion of competitive Voice over Internet Protocol services has dramatically altered the service provider landscape from what it was a mere 12 months ago.

Here's a look back at the year that was, from the news pages of Telephony magazine:

The Securities and Exchange Commission launches a major investigation into how telephone companies and cable operators count their customers, and its decision comes right after Verizon admits that it inflated its long-distance customers numbers due to a software glitch. The FCC decides not to challenge a March 2004 court ruling, effectively announcing the end of UNE-P requirements for the Bell companies. In response, AT&T says it will no longer offer local service. Both George Bush and John Kerry say broadband infrastructure is important, but neither one does much of anything about it.

Second quarter earnings reports are tepid at best, dashing hopes of a solid telecom industry recovery. Service providers begin changing the way they report numbers, choosing to report operational numbers designed to show growth — such as new DSL lines — over standard access line counts. One bright spot: SBC's deal with Dish Network nets 121,000 customers. Time Warner Cable says it is testing a new business model for providing voice service to the small and medium business market through a partnership with Voxpath.

AT&T Wireless announces its 3G network deployment in six markets, including San Diego, where the company is pitting its UMTS offering directly against Verizon Wireless' 1X EV-DO service. Verizon responds by announcing an expansion of its 3G offering to 14 markets. Wireless operators salivate as the FCC announces it will auction the so-called “H-Block” of spectrum and the spectrum released by NextWave as well. Tekelec buys VocalData to round out its VoIP product line, following VoIP acquisitions by competitors Lucent, Alcatel and Cisco.

Telcordia CEO Matt Desch admits that his company is for sale, and promises continued changes at the former Bellcore and a leadership role in the telecom space. Covad Communications announces new voice services, including VoIP, to survive in the post-UNE-P world. Iowa Telecom announces plans to issue an IPO. Federal lawmakers plan a preemptive strike to prevent state regulators from imposing regulatory restrictions on VoIP. Nokia decides to get into the content-distribution business, announcing a new initiative that will combine the efforts of thousands of software developers into a content catalog from which service providers can choose. Verizon promises to hire 3,000 to 5,000 people to help it deploy fiber optics to the premises in the Northeast, while SBC announces it has chosen Alcatel as its main supplier for its Project Lightspeed.

Qualcomm announces plans to invest $800 million in a nationwide mobile multimedia network to jumpstart the video-streaming market within the mobile industry. George W. Bush's re-election is considered good news for incumbents, as his FCC is expected to continue on its de-regulatory bent. Verizon says it is exploring ways to get ride of “non-strategic” access lines but faces a challenge in trying to sell or spin off a substantial number of access lines in rural areas and small towns. The company wants the additional cash to fund its FTTP initiative. SBC announces plans to spend $400 million to deploy Microsoft's IPTV platform and adds residential VoIP to its $4 billion Project Lightspeed initiative.

BellSouth says it will focus its broadband strategy on using faster DSL technology, not running fiber to the premises. Verizon says it is on track with its FTTP deployment and lands its second cable franchise, over considerable opposition from Comcast. Congress passes an Internet tax moratorium and approves a telecom package that provides additional funding for E-911 infrastructure, allowing government entities to be reimbursed for costs associated with clearing spectrum and changed.

SBC announces on Jan. 31 that it would acquire AT&T for $16 billion. In the same month that SBC Chairman and CEO Edward Whitacre reveal SBC's video ambitions to the Consumer Electronics Show, Comcast CEO Brian Roberts outlines his firm's aggressive VoIP plans to an investment group, signaling the next phase of the cable-telco competitive wars. The WiMax Forum says interoperability testing of the IEEE 802.16-2004 standard for WiMax gear is on hold but many WiMax vendors press forward anyway. Verizon Wireless launches the first mobile video service.

Verizon announces its plans to buy MCI Communications for $4.8 billion, touching off a nasty bidding war with Qwest, which has been courting MCI for months. BellSouth names Alcatel and Redback as its broadband vendors, signaling its intent to distribute intelligence to central offices throughout its network and deliver a more sophisticated broadband product. CLECs gathered at the CompTel trade show say the mega-mergers might create opportunity for focused competitors while their bigger foes are being distracted. VoIP is also a major push for the CLEC community, as it prepares for the end of UNE-P sales.

VoIP goes mainstream as America Online announces its VoIP service at the Voice on the Net show, and cable players say they are adding 18,000 voice subscribers a week. The war of words heats up between Qwest CEO Ri-chard Notebaert and Verizon CEO Ivan Seidenberg over whose company most deserves MCI. Samsung announces new gear aimed at the U.S. CDMA market, the world's largest. The Korean giant announces three new CDMA base stations. The session border control market tightens up as Netrake gained entrance into three more retail VoIP players via its relationship with Level 3.

Cable executives relish their competitive position at the NCTA show but admit they are challenged in adding wireless capabilities. The cable industry says it is adding VoIP subscribers at the rate of 20,000 per week and continues to dominate the telephone companies in high-speed data within the U.S. At month's end, MCI's board reluctantly admits the Qwest's $9.76 billion offer was superior to Verizon's much lower bid. Municipalities strike back at incumbents and manage to ward off most anti-muni broadband legislation. Telcordia unveils key changes to its operations, including new partnerships and new revenue streams, following its acquisition by Warburg Pincus and Providence Equity Partners.

MCI reverses course and accepts Verizon's sweetened $8.44 billion bid and Qwest finally withdraws from the bidding. Speculation is rampant that Qwest will seek other partners, such as Broadwing or Time-Warner Telecom. SBC chooses Amdocs for its Project Lightspeed OSS. Cablevision and its subsidiary Lightpath say they will work together to challenge Verizon in the New York City metropolitan area, combining Cablevision's Optimum brand with Lightpath's all-optical business network.

The TeleManagement Forum focuses on open source Operations and Support Systems, seeking to bring the benefits of open IT to the telecom back office. The FCC decides VoIP providers must support E911 and gives them 120 days in which to do so. Cisco announces new strategic initiatives for its wireless Local Area Network program. Siemens makes a major push into the access market with new broadband passive optical network gear.