 trade-off. The Final Judgment While the mid-century FCC was an unabashed fan of monopoly, not everyone in Washington agreed. The Department of Justice filed an antitrust suit against AT&T in 1949, demanding that the company sell Western Electric. This would at least create some competition in equipment manufacturing, which was clearly not a natural monopoly. Western Electric had until that point been involved in numerous other lines of business, such as audio equipment, broadcast radio transmitters, and hearing aids, but it was also in most cases the sole supplier of many types of equipment to the Bell System companies. The case was tentatively settled in 1956 in a decision known as the Final Judgment [6]. AT&T was allowed to keep Western Electric, but the lat- ter's operations were restricted to those needed to support the telephone com- pany and the federal government. The independent telephone companies thus had to purchase their equipment from a variety of smaller companies. A few states did at various later times require their Bell Operating Companies (BOCs) to purchase some of their equipment from competitors, but that was not the norm. Hushaphone and the First Cracks in the Monopoly A modicum of competition survived the mid-century. Western Union, while no longer the powerhouse it once was, still maintained its own telegraph service. By that time, the Morse telegraph had long been replaced by the electromechanical teleprinter. In 1939, Western Union finally cemented its monopoly on domes- tic telegraphy by acquiring Postal Telegraph from ITT Corp., while divesting international operations (an odd island of competition). A dial-up teleprinter network, Telex, was developing worldwide; Western Union joined in. AT&T had a competing service, TWX, built out of the emerging long distance dial tele- phone network. (Direct distance dialing was introduced to the public in 1951 and rolled out to most telephone subscribers within the next decade.) The two The Great Telecom Meltdown networks competed until 1981, when 