MCI: Truck Radio Relays, the Antitrust Suit That Broke AT&T and MCI Mail

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John D. Goeken founded Microwave Communications, Inc. in October 1963 to run a microwave radio relay between Chicago and St. Louis, with towers about 30 miles apart, serving truck fleets and Illinois Waterway barges. The company soon targeted small and midsize businesses priced out of AT&T's Telpak private-line service, seeking status as a specialized common carrier. In 1968 New York investor William G. McGowan paid off MCI's debts and joined the board, the same year the FCC's Carterfone decision struck down AT&T's ban on attaching outside devices to its network. When Illinois Bell refused to connect an MCI interstate circuit to its local switches, MCI filed a federal antitrust suit against AT&T in January 1974. In 1980 a Chicago jury awarded MCI $1.8 billion, later cut on appeal to about $113 million, and the case, alongside a Justice Department investigation, led to AT&T's breakup.

In 1983 MCI raised $1.1 billion through a hybrid security arranged by Michael Milken at Drexel Burnham Lambert, the largest debt financing in corporate history at the time. In 1984 it became the first carrier to deploy single-mode optical fiber, made by a Siemens and Corning joint venture, between New York and Washington. MCI Mail launched in September 1983 with Vint Cerf, MCI joined IBM and Merit Network on NSFNET in 1987, and in 1994 it built the commercial backbone MCI.net. WorldCom bought MCI for $34.7 billion in stock, topping bids from BT Group and GTE, and the merger closed in 1998. After WorldCom's accounting fraud and 2002 bankruptcy, the company emerged in 2003 renamed MCI Inc.

• A 1982 ad by Ally & Gargano hired the actors from an AT&T commercial in which a mother cries at her son's call; in MCI's version she cries over her AT&T phone bill.
• Single-mode fiber carries light straight down a narrow core, moving more data farther with fewer repeaters than multi-mode cable.
• In 1989 MCI Mail became the first commercial email service allowed to interconnect with NSFNET.
• The 1991 Friends and Family plan discounted calls to up to 20 other MCI customers in a calling circle.
• The 1993 1-800-COLLECT campaign featured Phil Hartman, Chris Rock, Arsenio Hall and Alyssa Milano.