TechStuff Classic: The AT&T Story - Part Two

Originally this published on November six, two thousand thirteen. Let's listen in. How about an episode on the history of A T and T, especially the deregulation of the telco industry. Now, of course we already talked about the founding of A T and T, but and how it started off kind

of as a natural monopoly. Um, now we're going to really look into how that continued and how the United States government began to uh put the brakes on A T and T a little bit, all right, because at the beginning they had kind of been saying, you know, you guys have this terrific infrastructure, you go on and

build that. That's terrific, right, This would be incredibly useful for the United States and so and then, and they took it over just for example, during World War One, which we talked about in the first episode, government said let's just take over this for a little bit, and then returned it barely used just a couple of years later. So we left off in the twenties. So we're picking up right around nineteen twenty four, which is when A T and T developed something that frankly, I was shocked

at how early the development for this technology came. I didn't expect to see this. It's a telephotography, which is also called a fax machine in goods. Yeah, I had no idea. Yeah, people were faxing goofy little pictures of of early twentieth century folklore back and forth, you know, letting people know that if you if you forward this one letter, Rockefeller will give you free M and m's or something. I don't I I don't think that's what

was actually being facts at the time. I honestly, UH just made all that up because it didn't research that. But then I don't know what the first facts was, hopefully not not some sort of email scam. We should do we should do another. I think we actually got a request for a facts related episode we should totally look into that. Sometimes we should do one about facts machines and one on facts lore, which is kind of the predecessor to the Internet email memes that we see

today or Facebook games exactly. Okay, So things that we do know about Bell Telephone Laboratories Incorporated open for business, that is, that is Bell's R and D Lab, which would come out with some of the most important pieces of technology of the twentieth century. Exactly. Yes, Bell Labs famous for their research. And here's the thing is that the research that Bell Labs did was not always directly related to the telephone industry, at least not in a

way that you could tell from the surface. But but down the line would become critical. Exactly. It's it's instrument at all in the way telephones work today. Now. Nineteen twenty six, that's when Bell Labs and Western Electric begin to make sound equipment for these crazy moving pictures that are coming out of the Hollywood these days. That's crazy. Yeah, so obviously not too far from the whole idea of

transmitting sound. Now it's recording and playing back sound in a way that works in a synchronized fashion with moving pictures. Nineteen seven A T and T begins trans atlantic telephone service between London and the United States. But they don't have a cable. There's no cable connecting the US in London at this point. That would be via a radio signal. Yeah, and uh, it was, you know, it was. It was a slight a little expensive to make a phone call.

It was seventy five bucks for three minutes. Yeah, which if you're looking at nineteen twenty seven dollars and then you compare them to today's dollars. I I used the Bureau of Labor Statistics, which uses the Consumer Price Index two factor in how much stuff costs from one era to another. According to that, that would be about a

thousand and eight dollars for those three minutes. So if you've got an extremely important phone call right to your British buddy, or if you're in London your Yankee friend, yeah, that's pretty much. That's that's pretty expensive. UM ninety nine, Bell Labs broadcast the first public demonstration of a color television picture. That's early too. Yeah, and it was. The thing they showed was a telephone operator, of course, dressed

in a colorful costume. And uh, A T and T researchers that year filed a patent for coaxial cable for broadband transmission. As of that year, there are more than twenty million phones in the United States, and fifteen point four million of those are operated by Bell. UH and they've got how many four hundred and fifty thousand employees They started off with one Thomas Watson. UH. Now they're up to four hundred and fifty thousand. Of course Watson was no longer with a company at that point, but

at any rate, Yeah, it's pretty amazing. And so nineteen thirty Bill starts to hold demonstrations to teach customers how to use dial service, the rotary dial, right, because before that, whenever you picked up a phone, you would reach an operator and you tell the operator where you wanted to place your call. They would find out how to root

it and do it for you. And UH, I think in the nine twenties they were starting to get into some electro mechanical systems that would do that for you but or for the operators, but you still had to talk to an operator to get your call to where

it was going. This was the first time that you would use a number a data set to tell the phone what you wanted to do, right, So this is where people started to get phone numbers and you would start to dial numbers and uh and all the all the switching was handled by electro mechanical switches at that point forward. But you had to teach people how to do this because it was new. No one had ever had to do it before. And I don't know how many of our listeners are familiar with the old rotary

dial phones. Dialing on those could be really fun if you were a kid, but if you were an adult making the Earth fifth or six phone call that day, you just sit there and hope that none of the numbers you had to call were in that nine range. Yeah, where you know, you dial and you just the whole thing click click ci ci cick click cick cick click. Good times. So by nineteen thirty two, Bell had was in control of seventy nine percent of national telecommunications market

in the United States. They had made acquisitions throughout those years and had bought up smaller companies, so nearly of all telecommunications in the US falls under that's an effectively a monopoly, Oh sure, right right, And it's also up from what's that about only a few years ago. So yeah, so they were, they were continuing to grow, and they were already practically the only game in town. So and a monopoly doesn't have to really be the only business, right.

You don't have to be just the only one out there offering something. To have a monopoly, you just have to be so large that no one can realistically compete with you on any similar level. So let's say, for example, that Google were to to completely dominate search. They're they're pretty far in the lead. Let's say they completely dominated to the point where no other search engine is even close. Then Google would have to start worrying about being identified

as a monopoly. And this is the funny thing is this doesn't necessarily mean that people are practicing unfair you know, tactics. That just may mean that the way they do business was the way that resonated with a lot of people. So you can have different views of monopolies. You can either see people trying their best to try and grab up as much as the pie as possible, or you just see people just doing a really good job and then being punished for it. So there are two sides

to this coin. I think in this case, in particular, it was due to that entire government regulation of basically allowing them to be a monopoly could be. Yeah, they had a huge head start, and then the government gave them an even bigger boost. Well, first of all, because of that whole patent thing we talked about in the last episode, they had exclusive rights for the longest time,

so yeah, they definitely benefited quite a bit. Moving on, so, nineteen thirty four, A t T began trans Pacific telephone service between the United States and Japan via radio signals. So again, as with many of these beginning services, you could only put through a single call at a time, right and now granted they had they had improved the efficiency of radio by that time. So remember just a few years earlier, that transatlantic call was around seventy five

bucks for three minutes. They lowered the costs for Pacific calls, which is amazing. It was only thirty nine bucks for three minutes, yep, which in today's money would be about six hundred and didn't yeah you know, forget your friends in London, call your buddies over in Tokyo. Um. Yeah, still expensive, but not nearly as much as it was before.

Now this brings us up. Ninety four is big year for a T and T because that's also when the United States government passed the Communications Act of nineteen thirty four. They thought about passing the Communications Act of nineteen thirty four nineteen thirty three, but the name just didn't work, so they held off for a full year. Lawrence just

staring at me. She doesn't like it when I throw in jokes, so especially bad ones established that that that's the act that actually established the Federal Communications Commission, also known as the f c C. Now the FCC did not just spring out fully formed and have brand new powers.

It actually kind of absorbed some previously existing organizations like the Federal Radio Commission and parts not all of it, but parts of the Interstate Commerce Commission that governed telephone and telegraph operations and kind of centralized all this because this was one of those examples of how technology outpaces is legislation absolutely, and so this was the United States government attempt to try and catch up to the state of affairs because they said, well, you know, back when

this was starting, we had no idea where it was going to go, and now we need to be big enough thing. And especially considering that more and more people were using radio signals. In the way that radio signals work is that you cannot have two signals on the same bandwidth going out near each other because they'll conflict.

You end up getting interference. Interference, right, So so yeah, so so government regulations starting to crack down on how people could use these new fancy radio signals in order to keep the airways clear for everyone's use, right. And it also gave the FCC authority to regulate rates of interstate and international common carriers and administration relating to electronic communication,

which was basically saying don't gouge your customers, right. So, in other words, A T and T remember was pretty much exclusive as far as long distance goes. So any regional operator had to pay a toll in order for

their customers to be able to access law distance. So if you're if let's say Lauren, You're in Atlanta and you want to call me, and for some reason, I'm in Omaha, Nebraska, and there are two different regional carriers, and so you are using your regional carrier to tie into the A T and T long distance service, and then that call goes to me, Well, your regional service has to pay a fee in order to access that a T N T long distance, and then that fee

usually gets passed down to you, the customer. And this was a way of preventing any company, specifically A T and T, because they were really the only one who could have that kind of wheeld that kind of power right from raising prices so much that it puts other companies out of business or it puts undue harm on the consumer. That was the intent. Uh. That brings us up to nine. When A T and T completed the first around the world call. It went all the way

around the world. That seems uh, less than useful in a technical sense, but good to know that they could do it. It was an impressive display of technology, not practical. If I want to if I want to call you, I just stand up and shout over the divider between our desks. I don't, I don't. No, I don't. I

don't not anymore, not on not on Tuesdays anyway. Not after hr taught to me ninety seven, that's when Clinton Davison of Bell Telephone Labs wins the Nobel Prize in Physics for experimental confirmation of the wave nature of electrons. So this is the first Nobel Prize awarded to someone working out of Bell Labs. It would not be the last.

And uh, in case you're wondering the whole wave nature of electrons, well, electrons are particles, but in the lab we have, I say, we scientists have observed that electrons could also behave like waves. And so this was that whole wave particle duality thing you can hear about in various types of particle physics, quantum mechanics, that kind thing. Uh, we won't go into it here because it's outside the realm of this podcast, but fascinating stuff. So it's no

no surprise they got the Nobel Prize. Now nineteen nine, the telephone is deployed as quote a weapon of preparedness end quote. That's also when Western Electric makes signal core sets leading up to the US involvement in World War Two. So signal core sets are essentially kind of like radio telephones. It is something that certain h certain units in World War Two had access to in order to maintain communications.

And UH just showed that this company was still very much involved in government uh projects, which will become important in just a minute. But before we get to that, let's take a quick break to thank our sponsor. You've probably tried Hulu dot com. Now with Hulu Plus, you can watch your favorite shows anytime, anywhere. Hulu Plus let's you watch thousands of hit TV shows in the selection of acclaimed movies on your television or on the go with your smartphone or tap blet and it all streams

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we're back, all right. So now we're up to nineteen forty one. And we talked earlier about how Bell Labs was was pioneering coaxial cable development in the laboratory is when they actually installed the first non experimental coaxial cable for Bell service between Minneapolis, Minnesota and Steven's Point, Wisconsin. So this is physical cable they're laying down for the transmission of signals as opposed to transmitting them over the air.

UM and uh, and it was a success. Ended up being the basis for the cable industry, also for the early internet industry. Pretty impressive stuff. Now, this is when World War two is being waged around the world, mostly and of course the European and UH Southeast Asia theaters. Um. This is also a time when Bell employees would serve in World War two. UH and and Bell companies would wind up producing more than one thousand two D defense

projects for all all kinds of stuff. I mean, you know, materials, radios, radar, mind fuses, all of that technical stuff that needed to happen. Yeah. So that another government project that was a big part of what a T and T was doing at that point was when A T and T begins automation of long distance switching. So now there at this point. The rolling it out would take years, sure, but but it was just not only local service but also across different

local UH networks. Right right, local operators connecting to the long distance one. We're starting to see the switching become automated. UH. That would be a big it. Proven inefficiency to as American households had a telephone, the problem was they all wanted to call the other half. Yeah, so darned when are they when are the Johnsons get that phone. We have more to say about the early days or middling days of a T and T, but first let's take

a quick break. Was when A T and T offers mobile telephone service in St. Louis, Missouri, And it's not what you're thinking of, Well, I had a car, Yeah, these were These were not the kind of handheld devices that that even Zach Morris would have many decades later. That's saved by the bell reference. That's that's that's after my time. But I get it. Um. I think each region of service had a single antenna which could handle about twenty calls at once at most most and sometimes

it was between twelve and twenty. It all depended upon the antenna. Yeah. These were again using radio signals, sort of like those those transatlantic and trans Pacific connections that we talked about earlier, but on a more mobile scale. You would call in and it would it would communicate to it to his tower, kind of similar to cell service, but it's not cell service. Yeah, if you if you moved outside the range of that antenna, you would not be able to place that call because there were there

weren't cells. You know, we will have to do a full episode on how cell phones work at some point to explain that handoff process. But there was no handoff process, so if you moved out of range, that was it. And these mobile telephones were enormous and heavy. They were more akin to the sort of stuff you would have seen in like if you've ever watched the World War

two movie where they have one of those backpack radios. Yeah, I think I think Patent carries a few around sometimes it's a it's a little closer to that, not quite as military looking, but similar in size and weight. So not something that was terribly useful for the average person, but for some people like truck drivers it might come in handy or other other people who happened to be

very mobile but have a large carrying capacity. On the middle of times, um, so the this is also the year seven when Bell Labs employees invent a particular piece of technology that would go on to play a very important role I think, and not only telephone industry, but computers the future as we know it. But we're talking about the transistor. Yep, that it was Bell Labs that came up with the transistor. And we've talked about and

then we talked about these gentlemen before. There were three people in particular leading that project who ended up later on winning a Nobel Prize for that invention. That's John Bardine, Walter Brittaine, and then William Shockley, who we talked about recently when we were talking about another company. Shockley's shocking views that led the some people to to become the traitor usk or something like that. Yeah, yeah, and and

and this transistor. We talked in the previous episode about vacuum tubes being such a huge development in the telecommunications industry because they allowed for those first electro mechanical computers to to work. And the transistor was what would replace these vacuum tubes in anything that was doing computing work. Yeah, it would allow you to do amplification, it would allow you to do and miniaturization. Maniaturization was the big thing.

It reduced heat and it allowed for miniaturization, something that you couldn't do with vacuum tubes, which meant that our computers no longer would take up the space of a building, could eventually take up the space of you know, your pocket smartphones. All of this really makes me wonder what would have happened. If A T and T had not had the reach and power and the money to have

this research and development lab. You know, if if they had not been the crazy not quite monopoly sort of a monopoly that they were, you know, would you know parallel development was going on in some other last Yeah, I think we would have eventually seen the transistor, but it probably would have come out later, and it probably would have taken longer to get ramped up into a a form that would be manufacturable, because this early transistor

was not something you would put in any kind of electronics. It was more of a proof of concept. If you've ever seen a replica of it, it was enormous. I mean, it's one transistor. Keep in mind that your average microprocessor could have a billion or more transistors on it. This thing was big enough to fit like it was, it would fit in the palm of your hand. But the wood. Yeah, so so this is this is early days yet, so I think our world would be significantly different had that

not happened. So let's move on to Uh. That was when A T. T began offering networking services for TV. Yeah, in the Northeast and the Midwest, So you know, The way it would work is that your your networks, your big networks, would use this service to transmit programming to affiliated stations in different regions of the states. So that way you could have like the Big Network broadcast out of some place like New York and then have that sent to to an affiliate station that might be far

across the country. This was also the year that A ten T began to build its first microwave relay system between New York and Boston. And microwave relay is a an improvement on, or not an improvement, but but a parallel development on that radio transmission that we've been talking about.

It's um it's a series of antennas or dishes that carry data via microwave, and these can be sent to narrow beams directly to the receiving devices, which means that you can have multiple devices working within the same bandwidth at the same time. So you dramatically increased capacity that way, right right, UM. You know, they've also got a higher

bandwidth and other radio waves. But you do have to have a direct line of sight, which means that you know it's it's you can't have something behind a hill or behind a tree. Or behind a house. It's not gonna work. Yeah, So there were limitations, but still dramatic improvements in being able to transmit information and both data and voices it would turn out. Uh So, moving on, we now get hit in nine with another antitrust suit.

We don't actually this would not be resolved for several years, and believe us, we will tell you about it when that happens. In that timeline. At that time, A T and T controlled about eight percent of the telecommunications industry in the United States, so still holding steady from several years before when they were at seventy. But keep in mind the industry is growing by leaps and bounds like that that of American households with telephones is growing over

a time. So while A T and t s percentage might have gone from the actual numbers are huge all right, Right. As of seventy sevent of American households would have a telephone. So that's that's the range that it was growing a huge jump. Yeah, and back in nine, that's also when A T and T introduced the five series tele phone, which was one of the most recognizable phones ever introduced. Have you ever seen this? It's essentially the base station with the rotary dial on it, and then you have

the back of it. The top back has the cradle where the handset sits. And uh, it's just one of those phones that once you see it, you're like, oh, yeah, that's what even if only phone I've ever seen as a smartphone, somehow I recognize that that's a phone. Um, yeah, because phones don't like that or sound like that anymore. And yet it's still the enduring image, I would say. And that's probably the where the sound that we think

of as a telephone ring comes from. As well. You know, before we all had you know whatever Miley Cyrus ring tones are, etcetera. Hey, let's not reveal to the listeners what my ringtone is. But we talked about that one A T and T introduces customer dialing of domestic long distance calls, and it started in Inglewood, New Jersey. So before that time, you could make local calls dialing. We talked about that earlier, but you would still connect with

an operator to make a long distance call. Also that year, A T and T helped broadcast a live transcontinental television show. Actually it was an address that President Harry Truman made to the Japan Peace Treaty Conference at the United Nations.

So big, big development in in just television broadcast at that point, right, This was thanks to that to that microwave really network that I was talking about that they had spent the past few years building um As of ninety one, it was a system of a hundred and seven towers, some thirty miles apart each and this telecast happened only a month after the very first call was

placed via this microwave network. They moved up their telecast schedule by almost a month in order to accommodate President Truman. That's pretty incredible that they were able to accommodate that so quickly, considering that it was just recently new technology. Yeah, that's pretty amazing. Nine. For the first time, Western Electric begins to produce telephones in different colors, giving choices to consumers. So it wasn't just black telephones anymore. Now you can

get them in beige. Uh. Nine fifty six was the resolution of that anti trust lawsuit. Yeah, so this was a big deal. So part of the antitrust lawsuit mad that A T and T agreed to restrict itself to just dealing with the telephone industry and also occasionally doing any sort of projects for the federal government that was asked of it, but otherwise to stay out of other industries television, of the slowly burgeoning computer industry that was

going on at the time. So essentially they were they were saying, all right, you know, we we don't want any trouble, Mr. United States Government, we will back off. So this is the first of that of that telco industry regulation. But we'll get into a one that directly affected A T and T even more than this did

another couple of decades, but see an even bigger one. Um. This particular consent decree also included a stipulation that had to place its patents for the transistor which which our friends, uh the nice Studeley, Dudes, Bardine and Britain, et cetera, and Shockley yes, uh, they won the Nobel Prize for

it this year. Um, they had to place the patents for that transistor in the public domain and be willing to license their tech for about dollars, which according to that Bureau of Labor Statistics calculator, would be about two hundred and fifteen thousand dollars. Right, And when you think

about the benefit of transistors. It's it's fortunate that that happened, absolutely because imagine a world where a T and T had had held onto that for yeah, I had what if they had had exclusive rights to the transistor the

way they had exclusive rights to the telephone company. Certainly, everything that we talked about in our in our last in our in our last few podcasts where we've talked about companies that were like fair Child Semiconductor and also things like Texas Instruments and other companies that that did pioneering work with transistors, Obviously that would not have been the case had they not been allowed to license that technology.

So yeah, big big decision there also was when service opened up for the TAT one, which was the Transatlantic UH telephone cable. Now, this is a cable that actually did stretch all the way from the United States to Europe, and the initial capacity was for thirty six calls at a time, so much better than that one call at a time radio method they had been using decades before. And they were also of a higher quality the calls

that you could place than via radio. And the cost was a near twelve dollars for the first three minutes, which translates to about a hundred and three bucks today, So a hundred three dollar phone call for three minutes, and we're also slightly more secure. There is less chance of somebody else. Yeah, it's a lot harder to tap into a phone line when it's underwater, not that I speak from experience. Was also the year that the first

picture phone system was tested. And and by picture phone, I mean this is this isn't FaceTime, it's you know, it would send an image about once every two seconds. And we're gonna get a little bit more into picture phone shenanigans. In the following years, Yeah, T and T introduced the first commercial modem, which was meant for enterprise customers, not not average consumers. So it allowed for computers to

make a direct connection to one another. There's not such a thing as as a network yet that that would come into play once arpa net really would give her would rise up in a couple of years. But modems, of course, became very important for that kind of technology to exist. A. T. And also began research work in lasers and fiber optics. That again another transformative technology in telecommunications. Speaking of transformative technologies, I believe you have a really

important note. I included this one just for Lauren because Lauren's a girl. You know, girls like pink. So I know that because the technology industries have taught me numerous times by all the pink electronics that are out there, that pink is for girls, and girls like pink, and if you don't like pink, then something's wrong, right right? Absolutely? Yeah.

So anyway, obviously I don't really believe any of that, but the introduction of the Pink Princess phone game in nineteen fifty nine, and then I have a note here which says, don't hit me, Lauren, Lauren, please don't hit me. All Right, we're gonna take a quick break to thank our sponsor while Lauren calms down. Alright, we're back. Lauren, has your murderous rage kind of died down to just just a loathing. No, yeah, I guess. I mean, you know, it's it's just normal, normal levels at okay um no,

so okay. So coming back to the timeline, in nineteen launched Echo, which was a balloon off which data could be bounced. And this is about to become important because in nineteen sixty two they would launch Telestar one, which was the very first active communications satellite. Right. Remember that at this time, the satellites that have been launched into orbit would usually transmit a very weak, very simple signal just to alert people on the ground that in fact

it existed, right. It was just a ping really. Yeah, So like spot Nick, it was the machine that went ping and went around the world a few times, and people on the ground could detect it, but you couldn't communicate with it. You couldn't use it to bounce signals off of it. It was really just there as a proof of concept, right. So the Tellstar one allowed for

actual live transmission of television across the Atlantic. Yeah. And and the first phone call transferred through space was between the A. T and T chairman and the Vice President of the United States within thirty minutes. That also tested live and taped television and other data. Though the whole project was a collaboration with NASA actually, but it was the first privately sponsored space launch. Yeah. And now look

at our world. Private private sponsored space launches are are becoming the way that we're getting into space these days. Nineteen three, A T and T introduces touch tone service, so we start to see the rotary dial begin to disappear, and now we have the keypad, the familiar keypad. If you've ever used an old phone with a keypad on it. Some of you guys just don't even know what that is. You to all your all your buttons have appeared on a screen. It's it's what the buttons replicate on a screen.

Skew morphism. Yeah, I want to skew more. Fig dial pad where it's the rotary top pad. I'm sure there has to be one positive something for me to look at more. Now, one of you clever app makers out there do that the rotary dial dial face. Uh, I don't know why I would give myself. I would just be less likely to make phone calls, which I guess is a good thing in the wrong run. I no one wants to hear from me anyway. I'm alright. A t T opens t PC one, which was the first

submarine telephone cable across the Pacific. So this stretched from Japan to Hawaii and they're connected to two cables that linked Hawaii with the mainland. Um so experimental picture phone service also begins in some cities. It talked about that right. It was installed specifically in exhibits at Disneyland and at

the New York World's Fair. Yeah, so again I had a monor and UH and a camera and was very primitive, but it was sort of the the predecessor to what we would think of as video calls, which still we're

waiting to take off. N A T and T installs a special purpose computer which was the first electronic telephone switch in a local telephone exchange in New Jersey, and I believe that first which was the four E S S, which could handle about five hundred thousand calls per hour, which was ten times the amount of the standard electro mechanical switch could handle exactly. So now we're moving into

the digital age and beyond the electro mechanical age. Nineteen sixty eight, A T and T introduces nine one one as the US nationwide emergency number, first rolled out in Huntington's Indiana. Other countries have their own emergency numbers, and uh, I have to mention, you know, according to the crowd, apparently the UK just changed it to oh one eight nine nine eight one nine to five three. I had to put that in there. Yeah, No, incredibly important. UM.

As of nineteen sixty of American households had a phone line. Finally, slackers, They just didn't have anyone they wanted to talk to. Nineteen seventy A T and T introduces customer dialing for international long distance telephone calls, starting with Manhattan and London. Um Also that year, a commercial picture phone service debut in downtown Pittsburgh and and went absolutely nowhere. Basically nobody

cared at all. I think they were like, this is cumbersome and kind of stupid, and I don't want it. I think for a lot of us, video calls are still kind of slow to be adopted because it means having to keep some part of your house pristine so that the people who are calling you don't realize how you really live. Always really nervous about about web web chat calls at work because I'm like, oh crap, what's going on in the background. Is Josh doing something inappropriate

back there? You know? Buty, Like by inappropriate, I mean like using the swords that Chuck has to have a fight with someone else in the editorial department, not that he would ever do that again. Labs produced the Unix operating system. Yeah, huge development here. So the idea was to create an operating system that was platform independent, meaning that you could put this operating system on different types

of computers. Because keep in mind, in the early days, a lot of these computers had proprietary systems that they would operate on, and that was it. You could not have You couldn't run the same kind of software for one computer and a next Yeah, because exactly because they did, they weren't compatible. You had to recompile all of your programming into a different language so you would run on

a different computer. This was kind of an attempt to allow a T and T to have a computer system where it didn't really matter what hardware they had as long as it could run this upbring system. They could run the same software across the multiple divisions. Huge development absolutely um in nineteen seventy five, armed partially with this at begin to computerize its operations. Yeah. Yeah, and the

computers could handle a much larger call volume. Like you mentioned earlier, Lauren, that that one switch was a good example. So we're starting to see a rapid rollout of development, although it would take probably ten years for this to be uh to be complete, because you know, it's a huge infrastructure, right, I mean, you're talking about a nationwide

telephone service. So it's not like you just flip a switch and suddenly everything's magically in computer world, right right, Um, the in fact, it would take until to complete the transition. That's true. The very last toll switch was completed in nine so even longer than I said ten years, I

was way off. N that's when m c I filed an antitrust suit against A T and T. Now they had started looking at the possibility of pursuing this kind of uh legal action back in there, you know, a little earlier in the seventies, they had met with the Department of Justice, but a T and T ended up disconnecting m c i s foreign exchange customers, kind of It doesn't say directly in response to m c I asking the d o J about this, but you might

be able to draw that conclusion. So with this antitrust lawsuit filed against A T and T, the Department of Justice would then look into the matter and file its own antitrust lawsuit against A T and T in nineteen seventy seven, So that will come into play in just a couple of years. Where that's that's the big one we talk about, the big This this lawsuit would go

on for six years. Yeah. So in seventy seven, besides the fact that the d O J brought an anti trust lawsuit against it, A T. And He also opened the first network operations center in New Jersey. Now, this allowed A T and T to have a centralized location where they can have real time management of its entire long distance network. Instead of having a bunch of regional offices that all coordinate together, they could actually control everything

from one spot, like you know, the Empire. That same year, A T and T installed the first fiber optic cable in a commercial communication system, so using light as opposed to electricity through a copper wire on the On his first day on the bench, Judge Harold Green drew the A. T. And T Anti trust case. Can you imagine that, your first day on the bench as a judge and you draw the A T and T Anti trust case. I think that must in fact be where jokes about like

the cases of the Mondays come from. That's pretty ridiculous, a case of many years of Mondays for that poor judge n nine. All right, so in the United States they had about a hundred seventy five million, five thirty five thousand and telephones active, give or take a few, and Bell had more than a million employees. That's incredible. A million people working for this company. That's phenomenal. One m c I wins its antitrust lawsuit against A T and T and the United States versus A T and

T goes to trial. So the m c I lawsuits over, but the Department of Justices lawsuits beginning about it. Yeah, so that brings us to January two. We're gonna end on this year and we'll pick up in night three in our next podcast. But six years of this federal antitrust case going on in some form or another, A T and T is up against the wall. They have really very few options, so they agree to divest themselves of the seven regional Bell operating company carriers that they owned.

So like the big ones, which also represented smaller companies inside it was up until this point um Jen really referred to as Mom Bell and yeah, all the different Bell systems, Southwestern Bell, Bell South, you know all these. If you've ever heard a company with Bell in the title of it as a telephone company, it belonged to this at the time. So A T. T essentially is getting rid of all of its local calling service. It's staying as a long distance carrier, and it also as

a sort of a concession. I guess you could say, you know, it had to get rid of all this local stuff so that it could no longer kind of maintain this monopoly. But in return, it was allowed to go into computer systems. Yeah, so computer communication business. Yeah, and it lift this, lifted that that band we talked about from the nineteen fifty six judgment. So now while A T and T has to get rid of all those other companies, and it would take a couple of

years for them to do this. I mean, obviously you can't just do this overnight either, but for them, the you know, in return, they get to go into this new industry. Um, so it's kind of a you know, uh so we lining kind of thing, if you want

to look at it that way. And I think it would turn out, considering the very fast gains in Internet popularity over the next couple of decades, to be completely worthwhile, well, especially considering that that separation of A T and T and those bell operating companies wouldn't last for all of them. But that's a spoiler alert. Yeah, so A T and T would end up reabsorbing Western Electric, it would become part of a T and T formally it was no

longer spun off. Also, the Bell operating companies would not be allowed to offer a long distance service, so A T T would remain the long distance carrier, the Bell operating companies would become local carriers, and neither was supposed to engage in the other's business. So uh, I mean, apart from a T T allowing the interconnections, but a T T could not go into local service. Bell operating companies cannot go into long distance service. Um. And also

the Bell companies couldn't go into information service or manufacturing. Uh. And everyone was supposed to provide had equal access to all long distance companies. So in other words, you couldn't have Bell South say that A T T was the exclusive long distance carrier Bell South customers had to have choice. So that's was supposed to set, you know, put us all back at square one, reset the playing field, we're

all on level ground. That was the intent. But I think we'll use our next episode to talk about how well that turned out. All right, I think it was really more, you know, it wasn't it wasn't leveling a playing field. It was giving luxury blimps to the people at the top of the playing field to kind of gently coast downwards a little bit, maybe a diamond encrusted uh landing pads for the golden parachutes. And that wraps

up this classic episode. Next week we will conclude the three part which again we could easily extend into another part, but we're gonna listen to part three next week. If you guys have suggestions for future episodes that I should cover on current episodes of tech Stuff, let me know. The best way to get in touch with me is on Twitter. You can use the handle text stuff h s W and I'll talk to you again really soon.

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