The Rebirth of a Phoenix By: Justina, Kacey & Isaac

Alexander Graham Bell invents the telephone in 1876 for which he receives two patents. With two financial backers he found the company that becomes AT&T. Within three years, telephone exchanges existed in most major cities and towns in the United States, operating under licenses from what was now the American Bell Telephone Company.

Building out from New York, AT&T reached its initial goal of Chicago in 1892, and then San Francisco in On December 30, 1899, AT&T acquired the assets of American Bell, and became the parent company of the Bell System.

Between 1894 and 1904, over six thousand independent telephone companies went into business in the United States, and the number of telephones boomed from 285,000 to 3,317,000.

In 1982, AT&T and the Department of Justice settled the antitrust case against AT&T. AT&T agreed to break itself up into several firms in These were known as Baby Bells. They provided telephone service in different regions.

The Department of Justice apparently felt that one company that provided local and long-distance service, was not required for productive efficiency, or that there were other offsetting gains from the diversity. According to the Department of Justice, AT&T provided an unfair monopoly against other providers of long-distance service.

The Department of Justice had difficulty of monitoring cost-shifting among AT&T's regulated (telephone) and other unregulated businesses (such as the manufacture of telephones and other equipment). The breakup of the telephone company eased the government's concerns.

In 1998, AT&T signs a definitive merger agreement with TCI, the second largest cable company in the United States. In 2005, SBC will acquire AT&T in a $16 billion transaction and create the industry's premier communications and networking company. AT&T is the largest provider of mobile telephony and fixed telephony in the United States.