The Futurist: Today's Phone Companies = The New Ma Bell

Considering that most people these days go through a cell phone in a time frame shorter than the human gestation period, it may be hard to believe that there was a time when phones were primarily an item you rented from the phone company.

Every once in awhile, we hear about a Renter — typically an elderly person — whose adult children discover AT&T has been charging them as much as $20 per month
for the privilege of keeping an antiquated (and usually very heavy) rotary phone in their home. In fact, as of 2006, as many as 750,000 rental phones were still ringing in the gated communities of Boca Rotan and Arizona.

As this choice excerpt from Ma Bell’s Wikipedia entry puts it: “Bell could effectively prohibit its customers from connecting phones not made or sold by Bell companies to the system without leasing fees. For example, if a customer desired a type of phone not leased by the local Bell monopoly, one had to purchase the phone at cost, give it to the phone company, then pay a ‘re-wiring’ charge and a monthly lease fee in order to use it.”

In order to justify the rip-off scam, Ma Bell simply lied, claiming that it would be risky to plug any old phone into their high-tech system, and that the wrong hardware choice could be disasterous. Right. In fact, it was only through a government-ordered break up of the Bell monopoly in 1984 that people earned the right to buy whatever phone they so desired.

Of course, a lot of this might sound awfully familiar to anybody who has had to deal with a phone locked to a carrier, or any of the other awful wallet-pilfering scams that are merely standard operating procedure for today’s phone companies.

Today’s mass telecom consolidation carries with it a bit of innate irony. Many of the companies that are merging today (“Cingular is now the new AT&T”) were once part of the same conglomerate. However, through excessive government deregulation of the telecommunications industry, these companies have been allowed to re-merge like the remnants of a shot-gunned T1000. As a result, us customers are often left begging for mercy. The more companies merge, the fewer choices we have. And while picking between competing rip-off scams always sucks, it sure beats being forced into one.

As Adam Smith might have said, competition breeds choice. Telecom consolidation breeds corporate hubris and poor customer service. At this rate, we will have a new Ma Bell, and the government will have no choice but to break it up again. And then, in 2020, the cycle will repeat itself all over again. It may not be obscene to presume we are doomed to an endless cycle of telecom consolidation and break ups–over and over.

Seth Porges writes on future technology and its role in personal electronics for his column, The Futurist. It appears every Thursday and an archive of past columns is available here.