Relay-Version: version B 2.10 5/3/83; site utzoo.UUCP
Posting-Version: version B 2.10.2 9/5/84; site psuvax1.UUCP
Path: utzoo!linus!philabs!cmcl2!seismo!rochester!cmu-cs-pt!cadre!psuvax1!berman
From: berman@psuvax1.UUCP (Piotr Berman)
Newsgroups: net.politics
Subject: Re: Supposed monopolies: AT&T (article 4 of 4)
Message-ID: <1683@psuvax1.UUCP>
Date: Tue, 6-Aug-85 22:32:07 EDT
Article-I.D.: psuvax1.1683
Posted: Tue Aug  6 22:32:07 1985
Date-Received: Fri, 9-Aug-85 02:46:15 EDT
References: <974@umcp-cs.UUCP> <7800361@inmet.UUCP> <1038@umcp-cs.UUCP> <9563@ucbvax.ARPA>
Organization: Pennsylvania State Univ.
Lines: 37

> Regarding Charley Wingate's conjecture that Ma Bell was (is?)
> monopolistic:
> 
> True enough, from 1877 to 1894, Ma Bell did indeed exercise a virtual
> monopoly over the telephone industry.  But once its patents expired
> (most libertarians, by the way, are in favor of time limitations on patents), 
> independent companies multiplied like rabbits, with the result that Bell
> initiated twenty-seven patent infringement lawsuits against them in
> 1894 and 1895.  This policy of litigation failed ...
> 
> These independent companies, no fools they, reliazed that mutual
> cooperation was crucial if any were to survive, and organized a national
> association in 1897 to establish long distance serivce between THEIR
> CITIES.  (Note that this is exactly the sort of thing that supposedly
> can't happen without coercion)...
> 
> What halted this trend was the passage of the Mann-Elkins Act of 1910,
> lobbied for by AT&T (and, in all fairness, by others as well)...
> 
> This makes the breakup of AT&T so ironic.  I personally think it was a
> good idea, but what would our phone system have been like if we
> had just left it alone?
> 
> --Barry
> -- 
> Barry Fagin @ University of California, Berkeley

Not only Ma Bell was monopolistic, all local companies are.  Therefore
I stressed "THEIR CITIES".  Each local telephone network is a local
monopoly, as such subject of (local) goverment regulation.  The "market
process" there is a bargaining between company and representatives of
population.  The breakup of AT&T merely split the representation of
the consumer in the process, what resulted in continuus rate hikes.
For each of the companies local network is a "cash cow" to produce
funds to develop new services.

Piotr Berman