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Bell System Property - Not For Sale

"BELL SYSTEM PROPERTY - NOT FOR SALE - Western Electric" -  Those were the famous words found on the handset and on the bottom of every phone in the Bell System prior to the breakup. You couldn't buy them, or sell them (legally) before the divestiture of the Bell System. I remember those days! You had to disconnect the bell inside of the "illegal" extension phones to make the phone "invisible" to the phone company test equipment.

As you will see in the documents below from the early 1980's, consumers were notified of the pending divestiture and the choices they will have for their telephone instrument - continue to lease it or to buy the one they are currently leasing or buy a phone from other suppliers.

More than 30 million initially chose to lease but now (year 2004) less than a million still do. New York based North Street consumer Phone Services LLC, which bought AT&T's telephone leasing business Lucent Technologies Inc., an AT&T spin-off, continues to manage the program.

In 2002, AT&T and Lucent settled a nationwide class-action lawsuit alleging that they charged unreasonably high lease payments for decades-old telephones.  The lawsuit required the defendants to set aside up to $300 million USD to pay damages, but they wound up paying only $8.4 million to 92,000 customers who filed claims.

This page contains some of the advertisements offering Bell System telephones for sale to the public for the first time around 1983. Due to space limitations on the web server, some of these images are scaled down from their original scan size.

Also on this page are links to scans of the Southern Bell's new rates that took effect on July 4, 1983 (just months before the January 1, 1984 divestiture of the Bell System).

 

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Lease or Own Your Own Phone advertisement

 

 

 

 

SELLING THE BIG SIX - 1983 - Issue 1 - Bell Telephone Magazine

How the Bell companies are making it convenient for customers to buy their phones. And how customers are responding. or Sale: More than 100 million telephones

"Excellent quality and dependability. Choice of six models: Traditional, Princess®, or Trimline® with rotary dial or Touch-Tone® pad (note: some exceptions). Variety of colors. Reasonable prices with discounts available. Easy payment plans. Thirty- or 90-day warranties. Call your local Bell operating company for details."

The Bell System has something fresh in the works for customers- the option of buying one or more of the Big Six phones. These are not the first Bell phones to be sold, of course. The System began selling Design Line® setshousing and insides- in 1980; and in 1981, the Touch-a-matic® sets, phones with memory, were offered for sale. But Big Six phones outnumber by far the other phones, meaning that the sales impact is likely to be substantially greater.

Although many customers probably will want to continue leasing their phones, Big Six phone sales, are, nonetheless, a potentially lucrative source of cash for the operating companies. With these sets generally ranging in price from 25 dollars to 70 dollars, sales could add millions of dollars to operating company coffers this year; however, a few companies may be hard-pressed initially to staff the operations necessary for negotiating and processing the hundreds of thousands of orders likely to come in over the span of just a few months.

For AT&T, the sale option plan is part of a commitment it made to the Fee in asking that all embedded CPE be detariffed this year. "The commission is concerned that this huge embedded base might give AT&T an unfair advantage in the marketplace," explains Daniel J. Culkin, AT&T assistant vice president-federal regulatory matters. "The commission believes that selling off a portion of the embedded base makes for healthier competition. And the FCChas made it clear that it wants the Bell System to sell as much of that leased equipment as possible. We're committed to making sure that customers know they have the option to buy."

The Bell System is counting on a 12- million-dollar national advertising campaign to help that effort. The multimedia campaign is scheduled to run from July through September. While not all operating companies have state regulatory approval to sell the phones (as of March, tariffs were in effect in 22 states), it's expected that most, if not all, states will have sale option tariffs in effect by the start of the advertising campaign.

To date, many companies with sale tariffs have used bill inserts to tell customers of the new option; detachable order forms were usually included in these mailings. New York Telephone customers mailed their orders to a private vendor in Atlanta, where the orders were processed and returned to the New York company for billing. "That way, customers received quick response on their orders and our normal business office operations weren't
disrupted by having to process hundreds of thousands of special orders," explains Robert V. Carlino, New York Tel product manager.

Through early March, about three million phones have been sold in the 34 states with sale tariffs a third of them in New York alone. Substantial discounts for buying in-place sets have drawn some customers, as has the Bell reputation for dependability. And although warranties are limited _ 30 days for in-place sets, 90 days for sets in inventory _ some customers have found a benefit in the promise that sets will be replaced immediately if found to be defective (most vendors require a week to a month to handle repairs).

The prices of Bell phones and the low cost of leased service may be discouraging some customers from buying, however. In Michigan, for instance, where rates are among the lowest in the nation, the "break-even" mark the point at which the cost of buying the phone equals the cost of leasing can be longer than two years.

Nonetheless, sales are expected to pick up as more operating companies have sale tariffs approved and as more customers become aware of the option to buy. "Most of our customers bought their phones within three months after the tariff was approved," says Carlino, "but we're still selling a lot of phones today. Some customers are just taking longer than others to make up their minds."


Rick Wilbins

Southern Bell's new rates for July 4, 1983:

Compare the above to these actual Illinois Bell Telephone phone bills from the early 1900's:

June 11, 1936

December 11, 1946 side 1 and side 2

Thanks to David Larson for these scans.  He stated in his email:

"My mother's mother was Rosie Efsic. She lived in the southern end of Aurora. The exchange there was 898. I understand from stories my mom told me that Rosie and Mike, her husband were one of the first few people to have telephone service in their home in the early '20's. I understand people would come over to their house on 853 Oliver Avenue to make calls. Mike, my mother's father, died when my mother was 13 years old...hence Rosie's name on the bill.

When I was a boy, the exchange name in Aurora was "Twinoaks"...then it became "TW"...then, of course, just the numbers. I still remember my grandmothers number of TW2-4418 and our phone number of TW2-2831.

There was a Western Electric plant in Montgomery, IL just south of Aurora."

 

 

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