Divide And Conquer?

For 100 years, AT&T believed in one thing above all: That bigger is better. It spent decades buying up local phone companies to create the Bell System and then fought off various government efforts to break up its monopoly. Even when Ma Bell was finally dismantled in 1984, AT&T hung on to its equipment-manufacturing business--despite initial opposition from the Justice Dept. Post-breakup, the company continued its buying spree. Under Chief Executive Robert E. Allen, who took over in 1988, the company pulled off two of the biggest deals in high-tech history--paying $7.4 billion for computer maker NCR Corp. in 1991 and $12.6 billion for cellular-phone operator McCaw Cellular Communications Inc. in 1994.

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