Bell System

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The Bell System was a system of telecommunication companies, led by the Bell Telephone Company and later by the American Telephone and Telegraph Company, that dominated the telephone services industry in North America for over 100 years from its creation in 1877 until its antitrust breakup in 1983. The system of companies was often colloquially called Ma Bell (as in "Mother Bell"), as it held a vertical monopoly over telecommunication products and services in most areas of the United States and Canada. At the time of the breakup of the Bell System in the early 1980s, it had assets of $150 billion (equivalent to $460 billion in 2025) and employed over one million people. Since the 1910s, American antitrust regulators had been observing and accusing the Bell System of abusing its monopoly power and had brought legal action multiple times. In 1974 the Antitrust Division of the U.S. Department of Justice brought a lawsuit against Bell claiming violations of the Sherman Antitrust Act. In 1982, anticipating that it could not win, AT&T agreed to a Justice Department-mandated consent decree that settled the lawsuit and ordered it to separate itself from its local phone companies, who would be broken up into seven "Regional Bell Operating Companies" (known as the "Baby Bells"). This ended the existence of the conglomerate in 1984. Following the breakup, the Baby Bells were independent companies and several of them became large corporations. However, in wake of the Telecommunications Act of 1996 which removed various restrictions placed on the Baby Bells as part of the breakup, many of them, as well the former parent company, later re-merged. As a result, by 2026 most of the assets and geographical service areas of the former Bell System had been re-assembled into two Baby Bells descendants: AT&T and Verizon.