stance Telephone Service) (Equipment Manufacturing) Bell Labs FIGURE 2-2 AT&T Post 1984 was gone, something had to be devised to make up for the loss in revenue. So the FCC created an access charge to be added to all long distance charges. The charge showed up on bills sent to long distance carriers and on subscriber monthly bills. The RBOCs are permitted to sell new customer premises equipment that is not of AT&T Technologies sourcing. They cannot manufacture equipment but are permitted to enter other lines of business with restrictions. Calls between LATAs or across LATA boundaries belong to the long distance carriers. LONG DISTANCE DEREGULATION AND GROWTH AFTER 1984 The battle for the long distance market really started on August 13, 1969, when the FCC voted 4 to 3 in favor of granting MCI's applica- tion to construct a microwave radio system between Chicago and St. Louis. At the time of the vote, AT&T had a de facto monopoly on all long distance service in the United States. The vote to grant MCI a construction permit was the first signal of a breach in that monopoly. For the first time since the eve of World War I, AT&T had competi- tion. The breakup of the Bell System occurred on January 1, 1984, when it entered into a consent decree with the US Department of Justice. The terms of the consent decree prevented the RBOCs from entering 2 INTERNET AND TELECOM: A BRIEF HISTORY the long distance or equipment manufacturing business. The decree also established equal access to the local exchange networks for AT&T and other common carriers such as MCI. Before the breakup, state PUCs and the FCC controlled pricing for services based on return on invested capital. Prices for services were highly controlled and generally increased only when justified by a new or improved service resulting from a capital investment. The regulatory framework was based on intrastate services, the domain of the PUC and interstate services under the watchful eye of the FCC. Revenue funneled through the local exchange business just like the 