Breakup of the Bell System

Bell System divestiturebreakup of AT&TAT&T divestitureAT&T breakupdivestitureBell Breakupbreak upbreakupThe breakup of AT&T1984 AT&T breakup
The breakup of the Bell System was mandated on January 8, 1982, by an agreed consent decree providing that AT&T Corporation would, as had been initially proposed by AT&T, relinquish control of the Bell Operating Companies that had provided local telephone service in the United States and Canada up until that point.wikipedia
185 Related Articles

Bell System

Bell Operating CompanyBell Operating CompaniesBell Telephone
The breakup of the Bell System was mandated on January 8, 1982, by an agreed consent decree providing that AT&T Corporation would, as had been initially proposed by AT&T, relinquish control of the Bell Operating Companies that had provided local telephone service in the United States and Canada up until that point. This effectively took the monopoly that was the Bell System and split it into entirely separate companies that would continue to provide telephone service.
Proliferation of telephone service allowed the company to become the largest corporation in the world until its dismantling by the United States Department of Justice in 1984, at which time the Bell System ceased to exist.

AT&T Corporation

AT&TAmerican Telephone and Telegraph CompanyAmerican Telephone & Telegraph
The breakup of the Bell System was mandated on January 8, 1982, by an agreed consent decree providing that AT&T Corporation would, as had been initially proposed by AT&T, relinquish control of the Bell Operating Companies that had provided local telephone service in the United States and Canada up until that point.
The AT&T Globe Symbol, the corporate logo designed by Saul Bass in 1983 and originally used by AT&T Information Systems, was created because part of the United States v. AT&T settlement required AT&T to relinquish all claims to the use of Bell System trademarks.

United States v. AT&T

ordered its breakupUnited States v. AT & TUnited States v. AT&T Co.
This vertical integration led AT&T to have almost total control over communication technology in the country, which led to the antitrust case, United States v. AT&T.
United States v. AT&T was the antitrust case in the United States that led to the 1984 Bell System divestiture, the breakup of the old American Telephone & Telegraph into the new, seven regional Bell operating companies (RBOC)s and the much smaller new AT&T.

Verizon Communications

VerizonBell AtlanticGTE
Bell Atlantic merged with NYNEX on August 18, 1997 in a $25.6 billion deal, retaining the name Bell Atlantic, and then with non-Bell GTE on June 30, 2000 to create Verizon Communications in a $70 billion deal.
In 1984, the United States Department of Justice mandated AT&T Corporation to break up the Bell System and split into seven companies, each a Regional Bell Operating Company (RBOC), and commonly referred to as "Baby Bells".

Western Electric

Western Electric CompanyWestrexWestern Electric Manufacturing Company
AT&T would continue to be a provider of long distance service, while the now-independent Regional Bell Operating Companies (RBOCs) would provide local service, and would no longer be directly supplied with equipment from AT&T subsidiary Western Electric.
One of the terms of the Modification of Final Judgment in the Bell System divestiture procedures prohibited AT&T from using the name Bell after January 1, 1984; prior to this, AT&T's plan was to market products and services under the American Bell name, accompanied by the now familiar AT&T globe logo.

Ameritech

Ameritech CorporationAT&T TeleholdingsAmerican Information Technologies
SBC purchased Southern New England Telecommunications in 1998 for $5.01 million, and Ameritech in 1999 for $61 billion, creating the largest U.S. local phone company at the time.
AT&T Teleholdings, Inc., formerly known as Ameritech Corporation (and before that American Information Technologies Corporation), is an American telecommunications company that arose out of the 1984 AT&T divestiture.

History of AT&T

SBC CommunicationsSBCAmerican Telephone and Telegraph Company
This company maintained a monopoly on telephone service in the United States until anti-trust regulators split the company in 1982.

NYNEX

NYNEX CorporationNynex PropertiesNYNEX Science & Technology
Bell Atlantic merged with NYNEX on August 18, 1997 in a $25.6 billion deal, retaining the name Bell Atlantic, and then with non-Bell GTE on June 30, 2000 to create Verizon Communications in a $70 billion deal.
Formed on January 1, 1984, as a result of the breakup of the Bell System, NYNEX was a regional Bell operating company made up of former AT&T subsidiaries New York Telephone and New England Telephone.

United States antitrust law

antitrustantitrust lawUS antitrust law
This divestiture was initiated by the filing in 1974 by the United States Department of Justice of an antitrust lawsuit against AT&T.
Perhaps the most famous antitrust enforcement actions brought by the federal government were the break-up of AT&T's local telephone service monopoly in the early 1980s and its actions against Microsoft in the late 1990s.

AT&T

AT&T Inc.Southwestern Bell CorporationAT&T Latin America
It was at this point that AT&T was purchased by one of its own spin-offs, SBC Communications, the company that had also purchased two other RBOCs and a former AT&T associated operating company (Ameritech, Pacific Telesis, and SNET), and which later purchased another RBOC (BellSouth).
The 1982 United States v. AT&T antitrust lawsuit resulted in the divestiture of AT&T Corporation's ("Ma Bell") subsidiaries or Regional Bell Operating Companies (RBOCs), commonly referred to as "Baby Bells", resulting in several independent companies, including Southwestern Bell Corporation; the latter changed its name to SBC Communications Inc. in 1995.

GTE

General Telephone and ElectronicsGeneral TelephoneGTE Corporation
Bell Atlantic merged with NYNEX on August 18, 1997 in a $25.6 billion deal, retaining the name Bell Atlantic, and then with non-Bell GTE on June 30, 2000 to create Verizon Communications in a $70 billion deal.
Following AT&T's 1982 announcement that it would divest 22 telephone operating companies, GT&E made a number of reorganization moves.

Southwestern Bell

Southwestern Bell Telephone CompanySouthwestern Bell TelephoneAT&T Missouri
The company was often considered the first step of the AT&T corporate "ladder" before the 1984 breakup of that company.

Alcatel-Lucent

AlcatelCompagnie Générale d'ElectricitéAlcatel Lucent
AT&T's gambit in exchange for its divestiture, AT&T Computer Systems, failed, and after spinning off its manufacturing operations (most notably Western Electric, which became Lucent, then Alcatel-Lucent, now Nokia) and other misguided acquisitions such as NCR and AT&T Broadband, it was left with only its core business with roots as AT&T Long Lines and its successor AT&T Communications.
AT&T re-entered the European telecommunications market in 1984 following the Bell System divestiture.

Long-distance calling

long distancelong-distancelong distance call
AT&T would continue to be a provider of long distance service, while the now-independent Regional Bell Operating Companies (RBOCs) would provide local service, and would no longer be directly supplied with equipment from AT&T subsidiary Western Electric.
During the 1984 breakup of the Bell System, the local access and transport area or LATA concept was created to distinguish between in-region calls (which were handled by local telephone companies such as the Baby Bells) and out-of-region calls (handled by interexchange carriers such as AT&T, MCI and Sprint).

AT&T Information Systems

American BellAmerican Bell, Inc.AT&T-Information Systems
AT&T was allowed to enter the computer market after the breakup; observers expected that with Bell Labs and Western Electric, American Bell would challenge market leader IBM.
It was one of the three core units of AT&T formed after the breakup of the Bell System.

Cincinnati Bell

Cincinnati Bell WirelessCincinnati Bell TelephoneCincinnati Bell, Inc.

Wisconsin Bell

Wisconsin TelephoneWisconsin Bell Inc.Wisconsin Telephone Company
In 1998, Ameritech sold some of its Wisconsin Bell lines (covering 19 exchanges) to CenturyTel, which merged them into its company CenturyTel of the Midwest-Kendall.
After the 1984 Bell System Divestiture, Wisconsin Bell became a part of Ameritech, one of the 7 original Bell Regional Holding Companies.

AT&T Technologies

AT&TAT&T Technologies, Inc.AT&T Technology Systems
AT&T Technologies, Inc., was created by AT&T in 1983 in preparation for the breakup of the Bell System, which became effective as of January 1, 1984.

MCI Communications

MCIMCI Telecommunications1-800-COLLECT
The breakup led to a surge of competition in the long distance telecommunications market by companies such as Sprint and MCI.
Where the divestiture of AT&T (Ma Bell) in 1984 led to dozens of long distance companies being formed, the Telecommunications Act of 1996 provided for the consolidation where today only AT&T, Sprint, and Verizon exist.

Satcom (satellite)

SatcomSatcom 1Satcom-1
However, by the mid-1970s, the then-new technology of satellite distribution offered by other companies like RCA Astro Electronics and Western Union with their respective Satcom 1 and Westar 1 satellites started to give the Bell System competition in the broadcast distribution field, with the satellites providing higher video & audio quality, as well as much lower transmission costs.
The networks fed to both Satcom 1 and AT&T's network at the same time (for the benefit of those stations who hadn't yet been equipped with earth station equipment for reception of the satellite) up until the breakup of AT&T in 1984, when the networks switched exclusively to satellite distribution on Satcom 1 (and later satellites), due to the much lower transmission costs, as well as due to AT&T's divestiture itself.

Viewtron

AT&T had invested over $100 million in the project, but was forced to write off that investment as part of its court-ordered breakup.

Standard Oil

Standard Oil CompanyStandard Oil TrustStandard Oil Co.
The only company since the breakup of Standard Oil that was divided into parts like Standard Oil was AT&T, which after decades as a regulated natural monopoly, was forced to divest itself of the Bell System in 1984.

Harold H. Greene

Judge Greene
The consent decree, later amended and usually called the modified final judgment (MFJ), provided for the Bell System divestiture, AT&T's spin off of the seven Regional Bell Operating Companies (RBOCs).

Consent decree

consent orderconsent judgmentconsent decrees
The breakup of the Bell System was mandated on January 8, 1982, by an agreed consent decree providing that AT&T Corporation would, as had been initially proposed by AT&T, relinquish control of the Bell Operating Companies that had provided local telephone service in the United States and Canada up until that point.

Monopoly

monopoliesmonopolisticmonopolist
This effectively took the monopoly that was the Bell System and split it into entirely separate companies that would continue to provide telephone service.