...Or a Free Ride for AT&T?

Dingell, John D.; Nulty, Timothy E.; McCarthy, Mark
March 1984
Challenge (05775132);Mar/Apr84, Vol. 27 Issue 1, p30
Academic Journal
The article discusses the benefits seeked by AT&T Communications Inc. due to the policy of divestment. A technological revolution has made pure monopoly unsustainable and some degree of competition inevitable and desirable in the communication industry. Total deregulation would undermine universal telephone service and this could mean the end of competition as well. But traditional monopoly regulation cannot keep pace with technological innovation. The consent decree agreed and the Justice Department enabled the parent corporation to walk off with two thirds of the revenues of the Bell System and one-third of the costs. In this case, if the local companies are to cover their costs, they must ultimately double their revenue from other sources, primarily local rates, in order to make up the revenues lost to AT&T Communications Inc. The United Federal Communications Commission (FCC) decision would impose an extra charge on residential customers for "access" to the interstate long-distance network, regardless of whether any long distance calls are ever made. State regulators would be forced to mirror the FCC's decision in imposing an additional charge for access to the intrastate long-distance network.


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