AT&T's multibillion-dollar acquisition of BellSouth will be a colossal event in the telecommunications business.

What, then, should Georgia's regulators do about it?

That question was debated Thursday by a gaggle of lawyers at a meeting of the state's Public Service Commission. The agency is being lobbied on two fronts about its role in the giant AT&T/BellSouth deal.

The companies believe state regulators don't have to give their blessing, per Georgia laws and past practices. But others — smaller rivals, for the most part — think the PSC should hold hearings and place conditions on the merger.

While the Federal Communications Commission will be the most-watched referee in the approval process, many states are holding hearings to review the deal, including Tennessee and Mississippi just this week.

Georgia, meanwhile, is proving to be unique in that it is — in essence — debating whether to have a debate.

As a result, the AT&T and BellSouth merger is keeping plenty of attorneys busy. Meredith Mays, BellSouth's general counsel in Georgia, on Thursday reiterated the argument — laid out in previous filings — that Georgia, like many other states, doesn't need to approve the deal. BellSouth also is perturbed that rivals are complaining now, weeks into the process.

Ken Woods, who represented Time Warner Telecom of Georgia and XO Communications Services at the meeting, argued in favor of hearings.

He and others on his side of the debate believe state laws require a review. "This merger is completely unprecedented in Georgia history," said Woods, of Friend, Hudak & Harris in Atlanta.

Anne Lewis, an attorney with Strickland Brockington Lewis who represented BellSouth competitors, said the PSC should give the deal plenty of scrutiny, partly because BellSouth is based in the state.

"We need the sunlight to shine on this merger," she said. "It seems like the sun should shine the brightest here."

But AT&T attorney Suzanne Ockleberry said the PSC's staff is checking into the merger. "It isn't like there hasn't been any review of this," she said.

In a filing with the FCC, the PSC already showed that it favors placing only limited conditions on the merger. According to the filing, the Georgia PSC wants the FCC to require AT&T to offer stand-alone digital subscriber line Internet service in BellSouth's nine-state territory. BellSouth currently doesn't provide such service on its own, so a customer who wants BellSouth high-speed Internet also must subscribe to phone service.

But even if PSC hearings are conducted, it appears unlikely the agency would erect any serious roadblocks.

On this, it seems, the two sides agree.

"Folks, it is clear that this merger is going through," said attorney Newton Galloway of Galloway & Lyndall, who spoke in favor of hearings.