What was the point of breaking up AT&T into 'baby bells' if they were all monopolies in their home states?

Question

What's the difference between one monopoly and dozens of monopolies spread throughout the country?

Answer 1

AT&T was one of the Baby Bells. In 1976 the 'monopoly' was banned and local competition was instituted. At that time AT&T became a Long Distance only provider.

The 'Bells' were restricted from offering LD until October of 2002.

The FCC instructed the Bells where they could no longer provide phone service - and still cannot in those areas. And yes - there are areas in every state that cannot have a Bell or the new AT&T - the providers vary, but include, McCloud, TDS, Sprint and MCI.

In the areas that are currently provided for by AT&T (formerly a Local Bell) there are competitive options available to the consumer. I say competitive because there are choices - I do not mean that the service/quality/features, etc, are equitable to the Bells - just that the choice is there.

Until 2005 the Bells did support the infrastructure for all land lines. Even if you had service through another provider the lines you used were built and maintained by the bells. Part of breaking up the bells was that they had to provide the lines to their competition for a set rate.

Over the years (until 2004) that rate was not allowed to be increased. It came down to the facts and the facts were finally heard. The cost to the Bells to maintain the lines (I don't remember the exact figures so the next set of numbers are ficticious - but you will get the drift.) ran approx. $1.00 per day for 1 mile of the line. They had to allow their competitors to 'rent' and resell that line for $0.20 cents. Needless to say - the cost was restrictive and unfair (guess who had to pay the extra $0.80 cents - yup - their customers and the tax payers. Meanwhile - the competition was pocketing the profits because they kept their prices equal to or just under the bells! Talk about rip off!)

OK - so to address the question - they weren't monopolies...most people never checked out the competition or the competition never moved into the neighborhoods. The Bells/AT&T - since 1976 has not been able to be restrict any provider from providing service in their territory...in fact they are published in the "yellow pages" of every phone book under TELEPHONE.

Interestingly enough - even with all of the competition out there between other providers, cable providers and cellular companies - EVERY 11 seconds a customer switches BACK to AT&T!

There has got to be a reason this (these - since they are made up of the most of the smaller Bells) company has managed to stay and business, raised their stock price, maintained a driving force on the stock market - and manages to keep the largest customer base - as well as encourage customers who thought the grass was greener on the other side back every 11 seconds.

I know for one I will keep them. (Security & privacy being my number one reasons. Cell phones don't contact the LOCAL police when I call, batteries go dead and ANYONE can eavesdrop on cell phones. It is still illegal unless you are the police or the government to tap my home phone line!)

Answer 2

Ka-Mali does not know as much as she thinks she does.

AT&T was never one of the Baby Bells. She was the Mother Bell, when divesture took place in 1976, she was split into the seven regional bells. The FCC allowed AT&T to maintain the long distance between the baby bells and the ownership of the local phone, not the local phone line.

As to the restriction of providing LD service, you is talking out her southern exposure. Baby Bell have alway been able to provide LD service in there regions and shared those charges when dialing into others.

As to the dozens of companies in an area, it drove the price of service down. Not necessarly provided better service, but let Mother know that she was not the only provider in town. Which at one point was a commercial on TV.

As to her comment regarding her cell phone not contacting the local police, maybe she should upgrade her phone or purchase her service from a major provider who follows the Cellular Service Standards.

Answer 3

Ka-Mali is right, whoever put thumbs down doesn't know what they are talking about. When you go with a CLEC (Competitive Local Exchange Carrier) you don't get the same service. When you choose anyone other than us, we used to only provide the dial tone to the interface on the house. Nothing more. Now Verizon has allowed the competition to pay for us to do inside work as well. Most, not all mind you, of their techs sucked and could not get the service fixed correctly. You do have a choice, but we own the copper on the pole and don't allow anyone else to mess with the network plant. Basically they give us the dial tone and we give it to you over our facilities

Answer 4

Because there are different markets.

The Baby Bells were all monopolies in their home markets. They retained the monopoly on local phone market for a period of time. It didn't make sense to have three or four different companies running repair trucks and wires all over the place... they had tried that in the early days of phone service IIRC and that is part of the reason why Bell was a monopoly in the first place.

The competition was introduced in the LONG DISTANCE market. If I called down the block I used my baby bell. If I called New York or L.A. or Tampa, MCI, SPRINT and other long distance carriers had to go head to head with AT&T for my buisness. Long distance prices fell, and kept falling. ( When I was younger long distance was quite expensive... one year for Christmas my present to my Mom was I called her cousin in South Africa on my AT&T credit card and told her talk for as long as she wanted. They had a good long chat and it ran about as much as I would have spent on a present anyway. ) This is why in the old movies say "It's long distance" and people drop what they are doing because long distance calls were expensive and unusual.

As competition opened up in the long distance market, it later trickeled down to the local phone service too, and then technology cut in and we got cell phones and the net and VOIP.

Answer 5

yes, you should just smack him silly for a 10 month old baby not locking their window which is probably taller than them.. What do you think! No.. you're so funny!!

Answer 6

When AT&T became deregulated, it ultimately allowed MCI, SBC, Bell South and others to be formed. Now, AT&T is buying up everyone but we still have MCI and Vonage.