The rest of the telephone monopoly lasted until January 8, 1982, the date of settlement of United States v. AT&T, a 1974 United States Department of Justice antitrust suit against AT&T. Under the settlement AT&T ("Ma Bell") agreed to divest its local exchange service operating companies, in return for a chance to go into the computer business (see AT&T Computer Systems). AT&T's local operations were split into seven independent Regional Bell Operating Companies known as "Baby Bells".
From http://en.wikipedia.org/wiki/American_Telephone_and_Telegraph

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