are similar and the two are "merging," they'll feel right at home. They are wrong. Dead wrong. The phone business is completely different from the computer business. In every possible way. How different they are is reflected in the fact that not one single computer company I can think of has made money in tele- communications. IBM lost over $2 billion. It bought Rolm, the PBX switch maker. It started Satellite Business Systems, the long distance phone company. And, at one stage, IBM even manufac- tured and sold its own PBXs in Europe. All these ventures are gone; closed or sold at a whopping loss. Ditto for Honeywell, which at one stage, owned a collection of interconnect compa- nies - PBX telephone sales, installation and service companies. The telephone industry has fared no better. AT&T lost SO much in its own computer business (it sold its own Unix machines and private-labeled Olivetti MS-DOS PCs) that is was forced to buy NCR to cover its immense computer losses. The local phone companies have fared even worse. When AT&T's Bell system was broken up in 1984 into AT&T and seven "Baby" Bells, the Judge made each of the Baby Bells "holding" companies, called RBOCs (for Regional Bell Operating Compa- nies). This meant presumably, that they were meant to "hold" something. Like AT&T, they thought there was big money in the computer industry - presumably on the philosophy that things unknown are more intriguing that things we know about. Thus, in order to "hold" something, they bought everything in software The Telecom Handbook xvii THE TELECOM HANDBOOK and computer retailing they could get their hands on. Nynex even bought IBM's computer retail stores - the ones IBM couldn't make money on. At one stage, Nynex even tried to compete with IBM's money-losing Prodigy service. Nynex's venture lost oodles, also. Virtually every other RBOC got into software and lost more money than most of us ever dream about. One RBOC bought a software company for $340 million and sold it the following year for around $160 million. Today,