I finally cancelled my landline telephone service. My local phone service has been deteriorating and the cable company made me an offer I couldn’t refuse. This is a big step for me because I was a phone company guy for more than half my career.
I’m still amazed by the technology that transformed an industry and ultimately made it obsolete. When I joined Illinois Bell in 1968, AT&T and its Bell telephone companies made up the largest enterprise in the world: more than a million people, tens of thousands of equipment buildings and millions of miles of cable dedicated mostly to voice telephone service.
That massive investment has all but evaporated. Voice telephone service now is a software function on a generic Internet router, just another data stream on the Internet or a wireless cellular system, and can no longer survive as a standalone business.
My career gave me a front-row seat to this transformation. The Bell System was a monopoly because the staggering capital investment needed to provide telephone service made competition impractical. It was heavily regulated, capably managed by engineers and former Eagle Scouts, and had fiercely loyal employees who racked up decades of perfect attendance. AT&T was a rock-solid business that delivered bulletproof dividends to widow-and-orphan stockholders.
Ironically, it was technology (mostly developed by Bell Laboratories) that made it economical for competitors to meet growing demand for long-distance data communications. This ultimately forced the breakup of the Bell System and fed a generation of lawyers.
Long distance service was the Bell System’s cash cow, and opening it to competition spawned giant companies (remember Worldcom?). But advancing technology eclipsed these companies when long distance service became so cheap that cell phone companies began giving it away.
Meanwhile, state regulators created pretend competition for local phone service by forcing telephone companies to sell their service below cost to fly-by-night resellers who would offer more choices to consumers. Consumers, for the most part, didn’t buy it.
Technology has done what government could not: create a truly competitive telecommunications marketplace. My local telephone and cable companies compete head-to-head with low-priced package deals on telephone service, Internet broadband and television. Today’s cash cow is television delivery, and that may disappear as Internet TV services like Hulu bypass cable and satellite TV companies. And more consumers are replacing landline service with cell phones.
Since government regulation was originally intended as a substitute for competition, today’s marketplace is making government agencies redundant and bureaucrats unhappy. With no monopolies left to dismember, the Department of Justice antitrust division is reduced to blocking mergers and the Federal Communications Commission is proposing to regulate the Internet.
Meanwhile, I’m enjoying my new digital phone service. Eventually I may take the next step and switch to all-cellular service, but I’ve grown accustomed to having a phone in practically every room. Perhaps I’m still a phone company guy.
Cutting the cord
I finally cancelled my landline telephone service. My local phone service has been deteriorating and the cable company made me an offer I couldn’t refuse. This is a big step for me because I was a phone company guy for more than half my career.
I’m still amazed by the technology that transformed an industry and ultimately made it obsolete. When I joined Illinois Bell in 1968, AT&T and its Bell telephone companies made up the largest enterprise in the world: more than a million people, tens of thousands of equipment buildings and millions of miles of cable dedicated mostly to voice telephone service.
That massive investment has all but evaporated. Voice telephone service now is a software function on a generic Internet router, just another data stream on the Internet or a wireless cellular system, and can no longer survive as a standalone business.
Ironically, it was technology (mostly developed by Bell Laboratories) that made it economical for competitors to meet growing demand for long-distance data communications. This ultimately forced the breakup of the Bell System and fed a generation of lawyers.
Long distance service was the Bell System’s cash cow, and opening it to competition spawned giant companies (remember Worldcom?). But advancing technology eclipsed these companies when long distance service became so cheap that cell phone companies began giving it away.
Meanwhile, state regulators created pretend competition for local phone service by forcing telephone companies to sell their service below cost to fly-by-night resellers who would offer more choices to consumers. Consumers, for the most part, didn’t buy it.
Technology has done what government could not: create a truly competitive telecommunications marketplace. My local telephone and cable companies compete head-to-head with low-priced package deals on telephone service, Internet broadband and television. Today’s cash cow is television delivery, and that may disappear as Internet TV services like Hulu bypass cable and satellite TV companies. And more consumers are replacing landline service with cell phones.
Since government regulation was originally intended as a substitute for competition, today’s marketplace is making government agencies redundant and bureaucrats unhappy. With no monopolies left to dismember, the Department of Justice antitrust division is reduced to blocking mergers and the Federal Communications Commission is proposing to regulate the Internet.
Meanwhile, I’m enjoying my new digital phone service. Eventually I may take the next step and switch to all-cellular service, but I’ve grown accustomed to having a phone in practically every room. Perhaps I’m still a phone company guy.
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