- Historic Sites It meant that the government should run the
telephone system. And there’s a reason the word is forgotten.
October 1995 | Volume 46, Issue 6 By the turn of the century,
AT&T had assets of $120 million, while all independent phone
companies together had assets of only $55 million. But the
independents were expanding fast as the telephone began changing
from a luxury to a necessity. To counter the new competition,
AT&T was forced to slash rates and become much more customer-
friendly. Still, it often acted like a monopoly in other ways.
It refused to allow independent companies to connect with it, so
these companies could not offer long-distance service. As a
result some cities had two different phone companies, one Bell,
one independent. Increasingly the Bell system used its monopoly
of long distance as a lever to force the takeover of these
independents. But this rapid expansion stretched the company’s
finances and forced it to issue ever-increasing quantities of
stocks and bonds. J. P. Morgan