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49 Infrastructure 1 (2009-2010)

handle is hein.journals/infrastr49 and id is 1 raw text is: A O PLU N T Vol. 49, No. 1, Fall 2009 By Gerald A. Connell, Michael D. McNeely, and John C. Peirce Eitor's Aote: This article traces the development of the teleconmmunica- tions industry in the T nited States, from the time that iMr Watson first heard hiniselfsummoned by Alexan- der Graham Bell, to the present con- fluence ofv oice, cable, and Internet The article jbcuses on the antitrust aspects of the industy, with emphasis on the role played by AT&T and the likelibood of increased scrutiny of the largestparticipints in the industry by qficials appointed by the Obana adinistration. In 1876, the Scotsman Alexander Graham Bell found a way to transmit the human voice using electric current-he invented the telephone. He could have, appropri- ately said What hath God wrought as his first message, since his inven- tion was to profoundly affect the world. It didn't take long for the immense importance of this revolu- tionary method of communications to become obvious to many, Bell included. Bell held two important patents covering the method of, and apparatus for, transmitting vocal or other sounds telegraphically. .. by causing electrical undulations, and the next year he and his investors Gerald A. Connell Michael D. McNeely John C. Peirce Gerald A. Coiiell past-chair oj the Section and a jbrmer antitrust litigator ith the US. DQJand the law firm oj Baker & HostetlerLLP /s now a sole pctitioner, in irginia. Michael D. McNeely is a solo antirstpractitioner in the Lau Offices ofMichae ID. McNeely in Wishington, D.C. John C. Peirce is partner in Bryan a'e LLP in Washington, D.C. formed the Bell Telephone Company to exploit those patents. In 1882, Western Electric was acquired to pro- duce the equipment that would be needed by the Bell System. In 1894, the Bell patents expired, and thousands of com- panies entered the telephone business in cities and towns across the country. Over the next 20 years Bell bought up many of the new independents, and also purchased WVestern union, creating at least a near-monopoly in both voice and telegraph communications. Its motto was One system, one policy, universal service, expressing its desire to manage the telephone system in the United States. In 1913, Bell resolved the antitrust concerns that its acquisitions and its policy had created by agreeing with the United States to divest Western continued on pafg/e 8 ALS IN.1DE.Clima..Chane.Regu ation......P GE.3. Published in Infrastructure, Volume 49, Numbei 1, Fall 2009 C 2009 by the Am eican Bar Association. Reproduced with permission. All rights reserved. This information or any portion thereof may not be copied 01 disseminated in any form or by any means or stored in an electronic database or retrieval system without the express written consent of the Ameri can Bar Association.

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