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Once upon a time when princess phones were extravagant

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POSTED October 1, 2012 12:18 a.m.

Ma Bell is probably having a good laugh right about now.

Not only are four of the seven Baby Bells that the Reagan Administration broke AT&T into in 1984 back under Ma Bell’s control but you can argue the phone ccompany is getting a larger chunk of household spending.

Thirty years ago people were complaining bitterly that basic residential service was approaching $25 a month. A second line cost another $10 a month. More than a few people thought it was highway robbery. But even $35 a month for two home phones was a considerable bargain because federal rules required a rate structure where commercial phone users essentially subsidize residential use.

Now the average household spending on wireless phone services has soared past $100 a month. And it isn’t usual for households with multiple smartphones to push an average $300 a month phone bill.

One of the biggest benefactors is AT&T.

And given wireless infrastructure consists of basically towers to relay signals and not endless miles of cable strung from pole to pole you’ve got to wonder whether the best thing ever to happen to AT&T’s bottom line was bureaucrats declaring them a monopoly and then carving it up. That allowed the new Baby Bells to go forth without the cumbersome regulations that were placed on the original Ma Bell.

Equally interesting is how TV was once free while 85 percent of households today according to various surveys pay for TV whether it is via cable or satellite. Yet the new trend is shifting to iPads which means wireless phone services are able to get even more money.

While you might be one of the minority of cell users who use their phones just as phones, you are either paying for every call you make or else you have a flat fee that is substantially larger even when adjust for inflation than in 1984.

While you might have unlimited calling around the world, how many of us really ever do that? What makes it even more interesting was the big cry and hue in the 1970s that you often had to pay long distance to call 20 miles away depending upon how your local phone exchange was configured. Today, you can call anywhere for the same price in the country but is that really better? Near the end of the monopoly period, AT&T had expanded local calling exchanges making them all accessible for the flat monthly fee with no limit on minutes.

Try doing that with a prepaid plan that consumers essentially pay by the minute regardless of whether it is across the street or across the country.

Somewhere between 26 and 32 percent of American households - depending upon which government survey you reference - have cell phones only and no land lines.

And many of us spend $300 to $400 every 18 months on a new smartphone. A disproportionate number of those buyers are under 25 and many of them are teen girls.

The reason I bring this up is to illustrate how times have changed.

Back in the mid 1960s the big “must have” for many teen girls” was a pink princess phone that setback the family budget $15 a month. (For those who have no idea what I’m talking about drop by the Smithsonian or Google it.)

Now a must have smartphone for a teen can set you back at least $300 up front and $100 plus a month for service.

One can imagine what the dads of 45 years ago who used to fume, fuss and scream when the monthly phone bill was opened would do today. Fortunately there is an app for that - basic CPR techniques.



This column is the opinion of managing editor, Dennis Wyatt, and does not necessarily represent the opinion of The Bulletin or Morris Newspaper Corp. of CA.  He can be contacted at dwyatt@mantecabulletin.com or 209-249-3519.

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