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The Bell System divestiture: background, implementation, and outcome. (The Enduring Lessons of the Breakup of AT&T: A Twenty-Fiv


(1.) See AT&T, 1907 Annual Report (1908); see also MILTON L. MUELLER, JR., UNIVERSAL SERVICE: COMPETITION, INTERCONNECTION, AND MONOPOLY IN THE MAKING OF THE AMERICAN TELEPHONE SYSTEM 4 (1996).

(2.) What is commonly referred to as the Kingsbury Commitment is a compilation of three letters memorializing an agreement between AT&T Vice President N.C. Kinsbury and Attorney General J.C. McReynolds. See LETTER FROM AMERICAN TELEPHONE & TELEGRAPH CO. TO ATTORNEY GENERAL, OUTLINING A COURSE OF ACTION WHICH IT HAS BEEN DETERMINED UPON; ATTORNEY GENERAL'S REPLY, [AND] PRESIDENT'S LETTER TO THE ATTORNEY GENERAL (Dept. of Justice, 1914).

(3.) The FCC's initial order in the Hush-A-Phone matter is discussed in Hush-a-Phone Corp. v. United States, 238 F.2d 266 (D.C. Cir. 1956).

(4.) Use of the Carterfone Device in Message Toll Telephone Service, Decision, 13 F.C.C.2d 420 (1968).

(5.) United States v. Western Elec. Co., 1956 Trade Cas. (CCH) para. 68,246 (D.N.J. 1956).

(6.) Regulatory and Policy Problems Presented by the Interdependence of Computer and Communication Services and Facilities, Final Decision and Order, 28 F.C.C.2d 267 (1970); Amendment of Section 64.702 of the Commission's Rules and Regulations (Second Computer Inquiry), Order, 77 F.C.C.2d 384 (1980); Amendment of Sections 64.702 of the Commission's Rules and Regulations (Third Computer Inquiry), Report and Order, 104 F.C.C.2d 958 (1986).

(7.) United States v. AT&T Co., 552 F. Supp. 131 (D.D.C. 1982), aff'd mem. sub nom. Maryland v. United States, 460 U.S. 1001 (1983).

(8.) The Justice Department did its part here, as well, requesting information that required boxcars full of paper to provide.

(9.) The underlying problem, which the lawyers negotiating the decree did not understand, was that in a fully integrated network, almost every toll switch was in part a "Class 4" and provided both toll switching and access to local switches.

(10.) Telecommunications Act of 1996, Pub. L. No. 104-104, 110 Stat. 56 (1996) (codified as amended in scattered sections of 47 U.S.C. (2000)).

(11.) As should have been foreseen, this was a bad deal for them. The crown jewels of the Bell system were not Bell Labs--they were the local monopolies.

By Joseph H. Weber, Joseph H. Weber is a telecommunications engineer with over 50 years of experience, mostly at AT&T and Bell Labs. Between 1980 and 1984, he held the position of Director of Technical Regulatory Planning, with responsibility for the technical aspects of all of AT&T's legal, regulatory, and legislative activities in the federal arena. In this role, he was the sole AT&T technical representative during the development of the MFJ, He subsequently led the development of the principles underpinning the division of assets between AT&T and the Bell Operating Companies and oversaw the actual division of assets process. After divestiture, he left AT&T and became a consultant, focusing on the technical issues related to telecommunications policy and regulation in the United States and abroad.

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COPYRIGHT 2008 Federal Communications Law Journal Reproduced with permission of the copyright holder. Further reproduction or distribution is prohibited without permission.

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