The Bell System held its last stockholders meeting today.
His voice cracking with apparent emotion, his company's profits sagging, and the Bell System empire eight months from a government-instigated breakup, American Telphone and Telegraph Co. Chairman Charles L. Brown met more than 2,600 stockholders here, attempting to assuage fears about the value of their shares and the future of the business.
But in remarks to stockholders, Brown was noncommittal on the value of AT&T securities. "I can't give you any guarantees," he said. "No one can."
Under a complex formula, AT&T has said that, for every 10 shares of AT&T they own, current shareholders will receive one share in each of the seven new regional phone companies that will be created by the breakup. They will retain their AT&T shares, as well, but those are certain to fall in value after divestiture, and there is uncertainty on Wall Street over whether the sum of the new parts in the future will be equal to the current value of AT&T stock.
Most of the exhibits, films and presentations at the $500,000 annual meeting here emphasized the Bell System's potential strength after the Jan. 1, 1984, divestiture. Brown said that the remaining AT&T operations and the local companies it will spawn will "bring the information age to all the homes and offices we serve.
"With advanced technology and vigorous marketing, we seek now to make commonplace the use of innovative telecommunications and information services," Brown said.
The divestiture of the local operating companies was mandated under a consent decree that AT&T signed in January 1982 with the government, ending a mammoth Justice Department antitrust suit against AT&T.
It was a wrenching decision for Brown and Bell management. "Our job, as we have always viewed it, is to conform the business to what is expected of it," Brown told shareholders. "I am not the world's greatest fan of this divestiture," he told reporters. "I neither welcomed nor wanted it."
But "there is no turning back," he said.
Brown's remarks to shareholders and earlier to the press were largely a lament of the death of a century-old, profitable, and efficient monopoly. "It is not the end of the world, but it is, indeed, the end of the Bell System as it as been known for so many years," Brown said.
And the pressures of a competitive world and a difficult national economy were readily apparent at today's meeting. Last year's AT&T earnings were flat and first quarter profits, announced this morning, dropped by 13.6 percent to $1.736 billion.
Per-share profits dropped to $1.87 a share from $2.40 in the 1982 first quarter, although AT&T profits rose very slightly after eliminating an accounting change. "Growth in the economy is not really taking place at the rate we'd like to see," Brown said.
The company presentation, however, was also a plea for AT&T shareholders to support the company's nationwide campaign to convince state regulators to agree to massive local rate increases that are either pending or expected.