Kim H. Veltman

American Visions

Maastricht, December 2004.

1. Introduction
2. Background of the Internet
3. AT&T
4. MCI/Worldcom
5. Verizon and the Baby Bells
6. Bellcore and SAIC
7. Energy
8. Military
9. Private Equity
10. Telco Pseudo-Crisis
11. Financial Sector
12. Other Sectors
13. Law and Trust
14. Conclusions


According to the news media, the history of the Internet is straightforward. In the 1950s the idea was opposed by the telephone companies, notably AT&T. In the 1960s, sponsored by the US military, the Internet started as an experiment to link scientists. This idea gained a wider audience. The breakup of AT&T in 1984 helped the process and the Internet was becoming a great success. All was well until 2000-2001 when there two great setbacks: 1) the bust and 2) a crisis in the telecommunications and specifically the telephone industry. Some link these events largely or even exclusively to the events of September 11, 2001. Since then, our safety has been jeopardized by terrorism and Internet developments have been correspondingly shaky.

This essay challenges the received wisdom concerning the Internet. There is strong evidence that there was support from telephone companies from the outset; that the breakup of AT&T did not fundamentally change the situation. Since 2000, there was no fundamental decline in the telecom markets, but there have been other important changes. Energy companies have returned to the media domain with avengeance. The military is extending its activities in the civil sphere. Private investment firms are systematically buying up sections of the entire telecommunications infrastructure from cables to satellites. There is a case to be made that the myriad bankruptcies in the field are being planned. This plan extends far beyond new media and includes education, finance, health, law and other sectors. And while the surface transactions are legitimate, these developments are leading to a crisis of trust, which endangers all the noble values of liberty and freedom for which the United States has rightly become famous.

Read full article