AT&T may have innovated in their labs, but they were glacially slow pushing innovation out to consumers. AT&T launch the push button phone in 1963, but it wasn't until the 80's (deregulation in 1984) that a majority of dial phones had been switched over to touch tone. One didn't their home phone, they rented from AT&T, so what was their incentive to innovate?
That’s not a lack of innovation, that’s a slow rollout. Innovation is the creation or introduction of some new thing not its takeover of the market.
Your primary care physician is in a competitive market yet presumably still makes appointments over the phone rather than allowing people to schedule online. Such technology has existed for decades and some doctors let you, but adoption is still slow.
It stifled innovation in the home phone market - everyone had the same phone for 40 years. When people were allowed to own their phones, you immediately had innovation. Some stupid consumer aesthetic innovation, but also more real changes like cordless phones, answering machines..
Except they did actually innovate headsets several times including inventing the push button phone. They were even working on Cellphone technology as they were broken up.
AT&T was hardly the only phone company in that time period, people just didn’t really care. Phones just cost a lot and spending more to have buttons just wasn’t considered worth it.
Even into 1982 most people were still renting their phones from the phone company: “Some resistance to buying phones might be evident in the response to the sale offers made in New York, California and Oregon. In New York, those who now rent a plain rotary dial phone pay $3.03 a month and have the option of buying it for $35, which means that the phone would pay for itself in reduced bills in one year. The return on some other models is even faster.
Even into 1982 most people were still renting their phones from the phone company:
Exactly! You had to. 1982 is a very relevant year, the last year before AT&T was broken up. People did want to own their phones, and they wanted choice, and they wanted fun weird phones, or cheap phones, or whatever. Monopoly quashed that.
From 1960 -> 1980 phones barely changed. Compare that to the changes from
You seem to misunderstand, this is months after the breakup and people still rented the phone. It stopped so quickly because the practice was literally banned by the FTC.
It seems strange today that people would rent phones, but they used to be very expensive items even outside the US. The practice ended because prices fell so far not because people’s preferences changed.
practice ended because prices fell so far not because people’s preferences changed.
As if prices aren't a part of preference? As if innovation isn't lowering costs? That alone torpedoes your claim - why wasn't AT&T innovating on lowering prices? Obviously because they were a monopoly and how no incentive.
What you you may not know, is that people didn't switch from renting to buying the same boring phones, the market exploded with phone options. Where was the AT&T cordless phone pre-1982?
