

Breaking Bell | Stuck in a Quagmire | 3
22 snips Jul 10, 2025
Corporate drama unfolds as AT&T navigates a high-stakes antitrust lawsuit against the Department of Justice. Tensions rise during a critical phone call that derails negotiations and sets the stage for the breakup of the Bell System. Key political players emerge, with Reagan administration figures grappling with the implications for national security. Amidst significant internal struggles, AT&T's survival hinges on pivotal legal decisions as they face mounting pressures and the threat of being dismantled.
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Crimson Sky Deal Collapse
- Negotiations between AT&T and DOJ over the Crimson Sky deal collapsed suddenly in early 1981.
- DOJ pulled out despite months of talks, leaving AT&T frustrated and stuck with the lawsuit.
AT&T's Monopoly and Political Shift
- AT&T had a century-old monopoly but faced growing political and legal pressures by the 1980s.
- The 1980 election shifted hopes for a settlement but also set the stage for intense antitrust scrutiny.
Near-Resolution on New Year's Eve
- On New Year's Eve 1980, AT&T and DOJ negotiators almost completed Crimson Sky with compromises on divestiture and Bell Labs.
- Both sides believed they had a deal that could end years of legal battles.