Greg Ottensmeyer March 1979 64x76On March 26, 1979, AT&T security personnel in the company of State troopers raided A. A. Answering Telephone Service in Bel Air, Maryland. It was my business and my home. Police confiscated electronic equipment I had been using to provide flat rate long distance service to a number of local customers since 1976.

Immediately after the raid, AT&T, which was then C&P Telephone Company, sent notices to each of my customers advising them that their Answering service would be disconnected in 30 days. I was not charged with a crime but I was put out of business and ultimately evicted from my home.  AT&T objected to me trying to compete with them for telephone business, which they held a monopoly over.

What happened to me that day became a precursor to the 1984 landmark decision that broke up Ma Bell’s monopoly and opened the US telecommunications industry to competitive market forces.

 For those who were not there, it’s important to realize that we only had wired telephones.  Mobile phones had not yet been invented. AT&T’s monopoly ruled supreme over our ability to communicate beyond your loudest yelling voice. No other choice existed. If you wanted to use a telephone you had to rent it from AT&T and pay them for every call.

In 1876, Alexander G. Bell invented the telephone and parlayed 17 years of patent protection into a group of Bell companies that became American Telephone and Telegraph. In 1913, AT&T became a government sanctioned monopoly, the largest there ever was. Although, AT&T was a publicly-traded company, they operated privately, often secretly with regal privilege and the swag of a government agency operating in the name of national security.

Ma Bell’s top management enjoyed a fiefdom of kingly perks, high-rise buildings, plush offices and private planes. Telephone company executives routinely hobnobbed with powerful politicians and foreign leaders as they rode herd over legion staff with militaristic precision.

For 107 years, competition was verboten and dealt with criminalistically. AT&T’s Security Department became notorious and proficient at investigating any would-be competitor who posed a threat to their cash-flooded coffers.  If you invented a better mouse trap that touched the telephone system and you wanted sell it; you would quickly feel like you had been thrust in to a Hitchcock scene, with hovering swarms of AT&T legal eagles swooping down with talons extended.

AT&T developed prosecutorial procedures that were routinely executed through their corporate legal departments as a means to quell competition. Their mandate was to take predatory action to protect the network at all costs, and little consideration was given to personal circumstance or human liberties. 

COMPETITION in the TELECOMMUNICATIONS INDUSTRY

2014 is a propitious time to recognize that the Competitive Telecom industry is merely 30-years removed from the former Bell oligopoly.   It’s a particularly notable milestone for those of us who owe our livelihood to Telecom competition.   Perhaps it’s also a good time to remember what’s changed in 3 decades.  Hmmm, let me think…

There was that personal portable phone dealeo that morphed into 4-billion Smartphone’s in 20 years.  Then that whole Internet craze with its browsing, emailing and the text, chat, tweeting thing.

Seriously, I cringe, quiver and cower to think about where we might be today had the telephone company break-up not occurred.

In the 1970’s Bell Labs conceived Cellular telephone network design, but the technology did not exist to make it happen. At least two companies set out to build it.  AT&T’s monopolistic mindset was to improve on the developing car phone network, giving it non-operator assisted call completion and greater capacity.  Then Marty Cooper, with Motorola, inspired by Captain Kirk’s StarTrek flip-phone, envisioned a hand-held phone because he realized people didn’t want to go from their landlines to being tied to their carphones. In 1990 the Motorola DynaTac™ portable phone was released and the rest is history.

NET NEUTRALITY or NET NEUTERING?

After studying Net Neutrality issues again, I don’t mind admitting that I’m still a bit confused.  I get it that the dominant Telecom carriers want to offer premium connectivity and rates, so-called fast lanes.  They do it now. The quickest way to communicate between two points is still a straight light path. Either the competition or the incumbents would be happy to sell you one.

I understand proponents of Net Neutrality, including Obama want to leave the Net alone by regulating it under Title-II of the Telecommunications Act of 1934 and imposing the doctrine of “Forbearance to level the playing field.  That sounds like a great idea.  Undoubtedly, exacerbating consumer confusion with layered legacy regulation and bureaucratic red-tape is the right solution.

In 1984 the monopoly was divested into 30 companies with the aim of limiting power and encouraging competition.  Today they’ve coalesced into 6 dominant carriers.  Two are wireless companies serving 50% of the public with their only voice service and the others mostly provide Internet and network services in their exclusive territories where upwards of 70% of Americans still have only one provider to choose from.

Those who do not remember the past are condemned to repeat it”.  George Santayana

Let’s admit it; Net Neutrality is ultimately about how, how much and from whom do we collect and distribute fees, in the form of Telecom taxes, so that government’s eroding Telecom revenue stream can be replaced under the new IP paradigm.  Would it not now be wise to take this opportunity to update the 80-year old Communications Act of 1934 to be relevant in 2014?  Isn’t it time to neuter the old Bull and put it out to pasture, just as we are with old telephone technology?

Actually, I always thought neutrality meant maintaining the status quo by making no choice. Like Sweden in WW-II, abstaining from the choice to be for or against either side.  In that sense, I am definitely for Net Neutrality, do nothing disruptive now, while we take the time to do it right.

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