“Telecommunications” refers to something vastly different than it did just a few decades ago. As recent as the early 1970s, “telecom” primarily referred to anything (and everything) to do with the telephone. Telecommunications is defined “…communicating or sending messages over long distances by electronic means….” The word literally means, communicating across a distance. The industry is known as telecom for short.
A “network” could be defined as, any system of things that are tied together. The network described here consists of wire and optic cable, equipment, satellites, antennae, and microwave equipment that tie your home or business to the rest of the world. Without this network the Internet, cell and ordinary phones would not work at all.
The Beginning: The Bell System
n the 1870’s Alexander Graham Bell spilled acid in his lab and called to his assistant in another room, “Mr. Watson, come here. I want you”. To his assistant’s surprise he heard the call through Bell’s first telephone device. Interesting that the first reported telephone message was a 911 call! Since that time, there has been an explosion of devices that transmit information “across a distance”.
The first telephone company was founded in 1877 just after Alexander Graham Bell obtained a patent for the telephone in the United States. It was called the Bell Telephone Company. Existing telegraph wire was in place from Samuel Morse’s telegraph network and was used for some of the first telephone transmissions.
Others across the country were stringing wire and offering service to people in those local areas. As demand grew for this invention, new alliances were made to join local networks to each other and the world. This expansion became the American Telephone and Telegraph Company. The name was shortened to the familiar AT&T and the network they created is known as the Bell System.
In 1974, The MCI Communications Corporation filed a lawsuit against AT&T. This was coupled with an antitrust suit filed by the Department of Justice for the purpose of breaking up the monopoly. That suit was won in 1980 which caused AT&T to divest itself of Western Electric and Bell Labs. Regional companies—known as RBOCS (Regional Bell Operating Companies)—were created such, as Southern Bell—my alma mater.
This divestiture started a storm of innovation and competition. Up to that point, AT&T—and a few small regional companies—built the network that spanned the U.S. and connected the rest of the world. Companies were bought, sold, combined and divested. Recently AT&T merged with some of its old holdings. It is hard to keep track, if you are not paying close attention. Suffice it to say, a lot has transpired since the 1970’s.
Timeline 1970s to 1990s
1970 - - March 1st sees the introduction of international DDD from London to New York City. The fifth transatlantic cable is placed in service on March 22nd. On June 26th, the FCC formally announces its place for regulating the cable television industry - barring the three major broadcasting networks from the cable TV field and prohibiting the joint ownership of CATV operations and over-the-air TV stations with the same community. On July 1st, the first commercial exchange offering of Picturephone service is introduced in downtown Pittsburgh, Pennsylvania. July 1st also marks the introduction of the first PhoneCenter offering customers the opportunity to select telephones, take them home and plug them in for "instant" service.
1971 - - The number of Bell System telephones in service reaches 100 million. Independent telephone companies serve 25 million and 160 million are in use in some 200 other countries. On January 22nd, the FCC announces a comprehensive investigation of AT&T - rate of return first, then mounting costs, Western Electric and service pricing. On March 16th, Mrs. Frances Jones Parker, owner of Jones the Florist, was elected a director of Cincinnati Bell and became the first woman director of a Bell affiliate. The FCC authorizes free entry into the Specialized Common Carrier (SCC) industry allowing for point-to-point private line competition with AT&T.
1972 - - On April 19th, Miss Catherine B. Cleary, president and director of the First Wisconsin Trust Company, becomes the first woman to serve as an AT&T director. In July the Bell System answers competition in the 4800 bits-per-second transmission range with the introduction of the 208A or Dataphone 4800.
1973 - - In March, Bell Laboratories announces the development of a telephone (the Touch-a-Matic) that could automatically dial a call to anywhere in the U.S. at the touch of a single button. Also in March, AT&T, eliminating the possibility of longer range problems, announces the sale of its 20 percent stock interest in Comsat. July 10th marks the 25th anniversary of the transistor by the issuance of an eight cent stamp. In August, Cincinnati Bell becomes the first phone company to receive regulatory approval to charge for Directory Assistance. (Handicapped individuals, hospitals and hotels are exempt from the 20 cent per call charge.)
1974 - - The Department of Justice files an anti-trust suit against AT&T. "The complaint...addresses the recurrence in the past three decades of anti competitive activity...which dates back almost to the foundation of AT&T". The DOJ wants a separation of "AT&T's ownership of inter city facilities from its ownership of local facilities and the separation of the current providers of telecommunications services from the manufacturer of telecommunications equipment and its allied research and development facilities".
1976 - - AT&T installs its first digital switch. The FCC launches Computer Inquiry II. Apple Computer is founded. The FCC begins a registration program for customer owned equipment attachable to the phone system. The FCC rules that SCC have exceeded their authorization for service. The Court of Appeals disagrees and the next two years will find this issue heavily debated.
1977 - - First lightwave system is installed in Chicago, Illinois. The FCC authorizes Cellular Trials.
1979 - - CompuServe goes on line. The number of subscriber telephone lines in the United States is now 175.2 million.
1980 - - The FCC issues its Computer Inquiry II decision which differentiated between basic and enhanced services. Basic service requires regulation. AT&T must now provide unregulated services through a fully separated subsidiary.
1981 - - IBM introduces the desktop personal computer (IBM PC).
1982 - - The FCC approves Cellular start-ups with two licensees per market. AT&T and the DOJ sign consent decree settling the DOJ's anti-trust case by divesting AT&T of its local telephone companies. Judge Green issues the Modified Final Judgment (MFJ).
1983 - - The scramble begins within AT&T to divest itself. ISDN trials begin in Japan. The U.S. has its first cellular subscriber. Microsoft announces Windows. The FCC creates and approves the "Customer Line Access Charge".
1984 - - The AT&T Divestiture creates seven (7) regional regional Bell operating companies. The Bell System has ended. British Telecom is privatized. Apple Computer introduces the Macintosh. Motorola sells its first portable cellular telephone. AT&T Technologies introduces the System 75 digital PBX for business users. IBM buys ROLM Corporation, the U.S. third largest business telephone system manufacturer and provider. Bellcore is established as a research and educational resource by the RBOCs "replacing" the lost Bell Laboratories.
1985 - - Teleport, the first competitive access provider, is established in New York City.
1986 - - The first round of "Equal Access" is completed by the RBOCs and independents.
1987 - - The U.S. reaches its one millionth cellular subscriber. ISDN trials begin in the United States. AT&T proposed price cap regulation.
1988 - - The first transatlantic fiber optic cable is completed. "Equal Access" is completed for 90% of RBOC subscriber lines and 70% of independent subscriber lines. The first "commercial" offering of ISDN service in the United States.
1989 - - Fiber to the home trials begin in Cerritos, CA. Judge Green allows AT&T but excludes the RBOCs from entering electronic publishing industry. The FCC sets price cap regulation for AT&T. The number of subscriber telephone lines in the United States is now 138.1 million; in the world: 496.0 million.
1990 - - IBM sells ROLM Corporation to Germany based telecommunications giant - Siemens Corporation. AT&T develops the optical digital processor. Telmex (Mexico) is privatized. Telecom New Zealand is privatized.
1991 - - Bell Labs develops photonic switching. The Court of Appeals orders Judge Green to lift the ban on RBOC entry into information services. AT&T fights the long fight and buys NCR. GTE purchases Contel.
1992 - - The first color motion videophone introduced in the United States. The U.S. reaches its 10 millionth cellular subscriber. The Cable TV Act is introduced to regulate CATV pricing.
1993 - - The first digital mobile network is established in the U.S. (Los Angeles) while the first all digital cellular network is brought up in Orlando, FL. The FCC allocates spectrum for PCS. Europe sets 1998 as the date for full liberalization of its telecom markets.
1994 - - The FCC begins PCS auctions. AT&T purchase McCaw Cellular. The number of subscriber telephones lines in the United States reaches 157.9 million; in the world: 609 million.
1995 - - There are now 25 million cellular subscribers in the U.S. Worldwide, 30 million users are now on the Internet.
1996 - - Commercial PCS operations begin in the U.S. The Cable Modem is introduced as the number of U.S. cellular subscribers reaches 40 million. AT&T announces its second major divestiture by spinning off NCR and its equipment business (including Bell Labs) under the Lucent Technologies name. Deutsche Telekom (Germany) is privatized. Worldcom and MFS merge to join local and long distance service providers. MCI and British Telecom merger to create Concert. France Telecom and Deutsche Telekom buy 10% of Sprint to form Global One alliance. Southwestern Bell announces merger plans with Pacific Telesis. Bell Atlantic announces plans to merge with NYNEX. The Telecommunications Act is the first real revision of the Communications Act of 1934 and is aimed at creating full competition in all markets.
1997 - - AT&T completes divestiture of Lucent Technologies and NCR. Implementation of the Telecommunication Act of 1996 is held up in some quarters in appeals courts as the RBOCs and the long distance companies battle over requirements. Bell Atlantic wins approval of its takeover of NYNEX. SBC wins approval of its purchase of Pacific Telesis. The number of RBOCs now sits at five. Ameritech and BellSouth file, under the Telecom Act of 1996, to provide long distance services within their service areas. Both companies are refused permission to do so based on the lack of competition in their local markets. The RBOCs contest (and win) the FCCs authority on overseeing the opening of local telephone markets under the Telecommunications Act of 1996. British Telecom loses its bid for MCI to Worldcom. Lucent Techologies aquires Octel Communications for $1.8 billion. SBC wins a temporary victory when a Texas court rules that the Telecom Act of 1996 is anti-competitive by requiring the RBOCs to complete a series of steps to open their local markets while placing no such requirements on competitors (IXCs) wishing to enter the local markets.
1998 - - The FCC comdemns the Texas Court's ruling and requests a decision from the Federal Courts. AT&T announces plans to acquire Teleport Communications. SBC announces its plan to acquire Southern New England Telephone (SNET) of Connecticut - in the heart of Bell Atlantic territory. AT&T announces plans to merge with TCI. Worldcom sells its internet unit to Cable & Wireless. The Worldcom purchase of MCI is approved. SBC announces its plan to "merge" with Ameritech. Bell Atlantic announces plans to merge with GTE. Ameritech attempts to enter the long distance market using Qwest. Bell Atlantic and Bell South's bids to enter the long distance market are denied. The FCC's attempt to lower access fees and implement"universal service charges" results in higher costs to the end user and a stampede of user complaints.
1999 - - Organizations all over the world spend billions of dollars as they try to make their telecommunications systems and networks ready for the turn of the century. MCI Worldcom becomes official. Mergia Mania strikes the telecommunications industry as thousands of small start-up companies are purchased by larger ones. SBC and Ameritech announce plans to merge. The Internet envelopes the business community as companies scramble to ensure that they are ready to do business via this "World Wide Web". Bell Atlantic becomes the first "Baby Bell" to be approved to offer inter-LATA long distance services to customers in New York. The antiquated manner of telephone number distribution and the soaring number of competitive local exchange carriers (CLECs) places demands for new area codes throughout the country. The FCC allows the "universal service" percentage rate charged to IXC (and thus customers) to rise. Qwest and Global Crossing plans to merge fall through as Qwest moves to purchase "Baby Bell" US West. MCI Worldcom announces plans to merge with Sprint. The Federal Government continues its anti-trust suit against Microsoft Corporation.