Friday, January 05, 2007

The New AT&T: Where the Competition Went

Broadband Reports presents a striking rendition of the geneology of our new corporate Telecommunications overlord, AT&T. (Click the graphic for the full scale version.) In 1984 old AT&T was broken up into 14 (approximately--see the graphic) separate entities on the grounds that it was a monopoly with only a few independent regional quasi-competitors.

The breakup didn't work because it was based on the assumption that it would foster competition by leading the new entities to invade each other's territories. That didn't happen. So competition never occurred and all we got were smaller, regional, monopolies. The painful truth is that nobody should have believed that this scheme would work. Ma Bell was a natural monopoly and the baby bells are too. Allowing the recombination of the Bell network into to monoliths (AT&T and Verizon) and one weak sister (Qwest) is an acknowledgement of that mistake.

But the central problem of monopoly remains to be dealt with. The history portrayed in this graphic proves that the solution needs to be practical, not ideologically driven, the next time. Frankly, we need regulation, real regulation from the FCC, not a continued subservience to the new nationwide monopolies from the agency whose job it is to protect the public.

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