Confessions of a Telephone Regulator: The FCC's AT&T Investigation of 1972–1977

Confessions of a Telephone Regulator: The FCC's AT&T Investigation of 1972–1977 Review of Industrial Organization 12: 303–315, 1997. 1997 Kluwer Academic Publishers. Printed in the Netherlands. Confessions of a Telephone Regulator: The FCC’s AT&T Investigation of 1972–1977 MANLEY R. IRWIN Professor Emeritus, Whittemore School of Business and Economics, University of New Hampshire, Durham NH, U.S.A. I. Introduction A quarter of a century has elapsed since the Federal Communications Commission launched a massive investigation of the American Telephone and Telegraph Com- pany (AT&T). In this study, known as Docket 19129, the Commission sought to determine whether the Bell operating companies (BOC’s) were paying too much for equipment purchased from AT&T’s supply affiliate, Western Electric. Stated as a question, did AT&T’s integration of telephone service and telephone manufac- turing benefit the telephone rate payer? AT&T’s ownership of telephone service and equipment manufacturing was hardly a recent development in U.S. telecommunications. Western Electric had been a part of the Bell system since the early 1880s. Despite some one hundred years of supply ownership, the policy questions attending Bell’s vertical relationship kept recurring over time. In 1934, for example, the very first inquiry by the newly created Federal Communications Commission was none other than AT&T’s ownership of Western Electric. The Commission’s examination of Western’s Review of Industrial Organization Springer Journals

Confessions of a Telephone Regulator: The FCC's AT&T Investigation of 1972–1977

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Kluwer Academic Publishers
Copyright © 1997 by Kluwer Academic Publishers
Economics; Industrial Organization; Microeconomics
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