Today's AT&T is really a Baby Bell that bought its old parent
For most of the 20th century one company, nicknamed Ma Bell, ran nearly all American telephones. Regulators split it into seven regional firms in 1984. The smallest of those offspring, Southwestern Bell, spent two decades swallowing its siblings and finally bought the shrunken parent in 2005, taking its famous name as a trophy.
The lineage begins with Alexander Graham Bell's telephone patent of March 1876 and the Bell Telephone Company he co-founded the following year. Bell himself drifted away from telephony and sold his stock by the 1890s. The American Telephone and Telegraph Company was created in 1885 as a long-distance offshoot, and in 1899 it took over its own parent's subsidiaries, including the equipment maker Western Electric.
When Bell's patent lapsed, more than 6,000 rival phone companies sprang up. Theodore Vail, returning as president, answered by charging competitors to plug into the long-distance network. By 1907 the company held over 80 percent of the market, and by the 1930s it had 83 percent of all phones, 98 percent of long-distance lines and 90 percent of equipment manufacturing. Federal oversight tolerated this natural monopoly through the Depression and World War II.
The reckoning came with a Justice Department antitrust suit that dragged on for almost eight years. Settling in 1982, the company agreed to give up its local operations, which became seven Regional Bell Operating Companies on New Year's Day 1984. The parent kept long-distance service and its research arms, but faced new rivals such as MCI and Sprint and later spun off Lucent Technologies along with other units.
Southwestern Bell, renamed SBC, grew by acquiring Pacific Telesis and Ameritech, then the old AT&T Corporation itself. Adding BellSouth reunited four of the seven Baby Bells. A turn toward media, buying DirecTV and Time Warner, disappointed, and both were later let go. Headquartered in Dallas, it now counts over 240 million subscribers and concentrates on 5G and fibre.
Source: AT&T
