The International Handbook of Telecommunications Economics, Volume III
Edited by Gary Madden
Chapter 7: The evolution of US WEST and Media One
7. The evolution of US WEST and MediaOne Martin G. Taschdjian INTRODUCTION Over the period from its formation in 1984 as part of the break-up of AT&T and the Bell System, to its creation and later spin-oﬀ from MediaOne, the saga of US WEST’s evolution into international markets and broadband technology is an archetypical story of the telecommunications revolution. The history of the company’s strategic initiatives and the learning and adjustments that it made along the way oﬀer a fascinating insight into issues of convergence, diversiﬁcation, technology, competition, shareholder value and public policy. By the end of the 1990s, just prior to its acquisition by QWEST, US WEST once again looked very much like the Regional Bell Operating Company (RBOC) that had been created in 1984. The lessons that were learned along the way suggest that the prospects for AT&T’s strategy of evolving from a long-distance carrier into a local broadband services company face signiﬁcant challenges, mainly around melding corporate cultures and conﬂicting belief systems. Its success will depend in a large measure on how management addresses and resolves these issues. THE LATE 1980S AND THE US WEST ENTRY INTO INTERNATIONAL MARKETS For the ﬁrst ﬁve years of the existence of US WEST, one of the legacies of the Bell System that continued was the practice of comparing the company to the other Bell Operating Companies for purposes of determining executive compensation.1 Each year, the staﬀ prepared a comparison of stock prices and changes,...
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