Yet, in 1965, all telephone services of every kind, and every piece of telephone equipment-whether a cable, wire, switch, submarine cable, telephone pole, central office building, or truck, and on a coast-to-coast basis-were owned and exclusively operated by the largest corporation on earth, AT&T. AT&T, with its wholly-owned subsidiaries comprising the Bell Telephone System, provided all local telephone service in virtually all cities of any size in the United States, leaving the "bones" of small-town telephone service to family-owned local phone companies. AT&T, the twenty-two Bell Telephone subsidiaries, Western Electric (the manufacturing arm) and Bell Laboratories (the research and development arm), were known as "the only phone company in town" or, simply, Ma Bell.
Ma Bell did not permit or tolerate any other person or company providing either telephone equipment or telephone services anywhere in the nationwide Bell Telephone System, from Boston to San Francisco. AT&T had, during the first twenty years of the 20th century, established a complete, pure monopoly over the only existing network to transmit first voice, and then data, and then TV signals, from one point to another. Prices for phone services were exorbitant and technological innovations in the Bell System network ranged between few and none.
But one of the dominant features of the American experience in the 20th century was a passion for economic freedom in an open, competitive marketplace-whether for ships, plane travel, shoes or toys. Free market competition, however, was unheard of in the hallways of AT&T, of Congress and of the federal and state regulatory agencies, and throughout the broad and powerful telecommunications industry which permeated the nation's social and economic fabric. AT&T acted as if its monopoly over the largest industry in the country was perhaps written in the Constitution; AT&T seemed invincible.
But some small entrepreneurs and their lawyers, including the author, commenced an attack on the AT&T citadel starting in 1965. Those early attacks triggered an all out war wherein the incumbent monopoly, AT&T, and a largely compliant set of federal and state courts and agencies, fought mightily against any competitive inroads. Hundreds of millions of dollars were spent by AT&T to protect its turf, and the lawyers' fees and related expenses were promptly passed on to the public; the ratepayer paid for AT&T's war against competition. AT&T utilized deception and falsehoods in a thoroughly immoral war conducted in what was otherwise a moral and open society.
This book speaks to the present and the future regarding the most dynamic and explosive development in the world economy in decades: the rapid deployment of cutting-edge technologies, while looking back to the painful struggle of a few good people who changed the definition of communications in America and in the world from a system wrought by Ma Bell to a new, competitive communications environment which unleashed those same cutting-edge technologies and created the Information Age.
This book will explain, in laymen's terms, the significant events in telecommunications and, consequently, in the development of the Internet, from the creation of the AT&T monopoly to the present; from the 1984 break-up of AT&T and the Bell Telephone System to the January 10, 2000 announcement of AOL's $166 billion acquisition of Time-Warner. It will cover these dramatic events over the past thirty years, from the famous Carterfone and MCI decisions, which broke the AT&T monopoly, to MCI's $37 billion merger with Worldcom; the larger, $115 billion dollar acquisition by MCI Worldcom of Sprint; and the largest acquisition in history, AOL's $166 billion acquisition of Time-Warner.
The book will discuss the "merger mania" of virtually every major player in telecommunications and the Internet, such as Southwestern Bell's acquisitions of Pacific Bell, Southern New England Bell and Ameritech-creating a conglomerate known as SBC, Inc. which is now the largest local telephone company in the United States.
The book discusses the view of most market analysts that the outstanding and unprecedented performance of the U.S. economy throughout the 1990s was in large measure due to the explosive growth of technology and, specifically, the Internet stocks group. Thus, in 1999 alone, there were 290 initial public offerings of stock (IPOs) by Internet companies, who collectively raised over $24 billion dollars in new capital.
The book looks at the historical AT&T monopoly arising in the early days of the 20th century, which resulted in AT&T 's enormous economic and political power-an institution Sonny Kleinfeld of The New York Times described in his book, "The Biggest Company on Earth." AT&T was a corporate giant which had an annual gross domestic product which was greater than most nations of the world. And the book will describe how, in the last third of the 20th century, some small entrepreneurs and their attorneys, including especially the author Ray Besing, were the Davids who brought down the AT&T Goliath.
--This text refers to the
Hardcover
edition.
