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40th anniversary of the ‘Baby Bell’ breakup

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These days, if you want to make a phone call, you have plenty of choices in phones, service providers, minute plans, data plans, and pay-as-you-go plans.

Not so long ago, however, throughout much of the era of landlines, you had just one choice: AT&T.

Since the breakup of the AT&T monopoly, a choice has expanded exponentially. Costs have gone up. And it’s a lot more complicated these days to just talk on the phone.

Up until 1982, AT&T controlled almost the entire American telephone network under the Bell System. If you wanted a phone, you rented one from AT&T (and only AT&T) and connected primarily to AT&T telephone lines.


The break up of the Bell System was a long time coming, with AT&T facing lawsuits throughout the 20th century. AT&T worked with the American government to avoid breakups and reached milestone agreements in 1913 and 1956.

The 1956 consent decree agreement was particularly important, as AT&T was forced to focus on running the national telephone system and special projects with the government. They couldn’t enter other markets.

Still, AT&T protected its turf. For example, AT&T long fought to keep the Caterfone, a mobile communications system, from connecting to its telephone lines. Then in 1968, the FCC decided that Americans could connect any lawful device to telephone lines.

Tensions between AT&T, the government, and rival telephone companies continued to simmer before finally boiling over. In 1982, an agreement was reached to break up AT&T into regional rivals.

In exchange, the new Baby Bells would no longer be restricted to the national telephone system and could enter new markets, such as computers and later, the Internet.

These days, mobile phone networks are similarly dominated by the Big Four: AT&T, Verizon, Sprint, and T-Mobile. The FCC found that these four companies soaked up 98 percent of mobile wireless service revenue in 2014.

Sprint has since joined forces with T-Mobile, further solidifying control. Still, consumers have alternate mobile service options today, such as Google Fi, which uses T-Mobile’s network, but is managed by tech giant Alphabet.

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Small businesses leverage delivery services

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If you build it, they will come — or so the saying goes. These days, many customers prefer that you come to them. Delivery services surged during the COVID-19 pandemic as social distancing shut down brick-and-mortar stores. Yet even before the pandemic, delivery services from local businesses were growing at a fast clip.

Food is the most obvious example. Once upon a time, if you wanted hot food delivered, that meant ordering pizza. Now, you can order just about any cuisine you’d like. Hibachi steak, steamed snow crab, chicken parmigiana — if a restaurant is cooking what you crave nearby, there’s a good chance you can get it delivered.

McKinsey reports that the global food delivery market has tripled since 2017 and is now worth more than $150 billion. While big companies like Domino’s Pizza once dominated delivery, food delivery partners like DoorDash and Grubhub make it easier for small restaurants to get their food delivered, according to emarketer.com.

Across the United States, many malls have become ghost towns, with regional mall vacancy rates hitting a historical high of 11.4 percent, according to the Washington Post. Research has found that there are still over 130,000 small specialty stores in the U.S., but the number of such retailers contracts by .8 percent each year.


Ask folks why and many will point to the Internet. Amazon, eBay, Etsy — some of the biggest companies today simply skip brick and mortar. Yet there’s an important but sometimes overlooked component: delivery services.

Small businesses can now ship products (candles, electronics, lotions, whatever) through Postmates, DoorDash, and other delivery services. Or you can sell products through Amazon and similar sites, relying on established shipping services to get products to customers’ front doors.

Skip delivery at your own peril. Insider Intelligence estimates that restaurant delivery intermediary sales (i.e. DoorDash) will top $57 billion in 2021.

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Gaming: How something free makes money

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Whether you enjoy playing games on your smartphone, computer, or console, you’ve got tons of options, including free-to-play games. Some of the most popular games right now, including Genshin Impact, Forge of Empires, and Destiny 2, are free to play. So why would companies give away games? As is usually the case, there’s a catch.

Video game developers have perhaps perfected the use of free products to draw customers in, then upselling to drum up revenues. Bungie, for example, gives away the base Destiny 2 game for free.

As you get into the game, Bungie tempts you with expansion packs, such as Beyond Light, which adds new levels, worlds, and stories. The Beyond Light expansion typically retails for $39.99 and has topped sales charts on Steam and other platforms, according to pcgames.com

Besides expansions and add-ons, many developers also encourage people to make in-app purchases. You might buy a distinctive outfit for your in-game character or a special weapon, for example.



Another popular way to get customers paying is to offer a ‘loot box.’ You pay for the box, then open it up and find out what you got. Often, you’ll get costumes or weapons for your character. And in some cases, you’ll receive rare items. Some critics liken loot boxes to gambling, however. While some get great items, a lot of folks receive items not worth much.

Genshin Impact uses loot boxes, among other tactics, to drive sales within the free-to-play game. The game has pulled in over $2 billion in sales across PCs, consoles, and mobile platforms.

Free is free. Yet if you can upsell other products or services, you can pull in revenue.

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The murky business of online gambling

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When you think about gambling, you might conjure up the bright lights on the Vegas strip, where the entire infrastructure was built around a person dropping a token into a machine.

Online gambling needs no such infrastructure or fancy hotel rooms. It relies entirely on the belief the customers have in fair software — and they really do believe. According to Forbes, online gaming topped $72 billion in 2021, up from $64 billion in 2020.

To put that into perspective, Las Vegas brought in just $2.1 billion in gambling revenue in the third quarter of 2021, a record-breaking sum.

So customers believe, but should they?


In a business that is designed to take money, there is no online gaming commission. Online casinos can’t be legally set up in the U.S. and Web publishers on any platform can’t accept gaming ads.

Illegal online gaming sites often have problems processing cash, since the biggest transaction companies won’t take their business.

Nonetheless, anyone can place a bet.

The problem with online gambling is that everything could be fake: The other players, the odds, the games, the payouts, the winners, and the dealers. It’s a world created by the software.

How do gamblers know if online casinos are even paying anything out? They don’t know. They can’t know if the software is set to some kind of win probability consistent with terrestrial casinos or not. While some gaming sites claim to be inspected by accounting and gaming industry firms, there is nothing to stop an online casino owner from paying nothing. After all, he controls the software.

But the customers still flow in. By 2025, projections suggest that the market will be worth $112 billion.

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COVID-19 relief may leave some with tax bills

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Each year, millions of people receive unemployment benefits. And each month, billions are paid out in benefits. Yet many folks fail to realize that they’re required to pay taxes on unemployment benefits, as the federal government and many states consider it taxable income.

The tax bills, both from the individual and government’s perspective, are no small matter. In September 2020 alone, the American government shelled out over $13 billion as people lost their jobs amid the global COVID-19 pandemic. While the government paid out $2.7 billion in September 2021, that’s still a large chunk of cash and will generate considerable tax liabilities.

During the pandemic, the government provided expanded unemployment benefits. However, those, too, could inflate your tax bill. The $600 expanded unemployment benefits provided by the CARES act and the $300 benefits from the later relief packages are considered taxable income.

There’s an important caveat, however. The American Rescue Plan offered a tax break on the first $10,200 of unemployment benefits so long as your (single or couple) adjusted gross income was less than $150,000. Keep in mind that this is a federal tax break, and you may need to pay state taxes.


How about the stimulus checks offered through the CARES Act and the American Rescue Plan? Those are not taxable as they are actually tax credits.

Taxes are (ideally) paid as you go. You should have been paying taxes on your income by sending money to the IRS while receiving benefits. You can pay monthly or make estimated quarterly payments. Waiting until tax day to pay may result in penalties.

Don’t have the cash to pay for your taxes? In some cases, the IRS offers taxpayers payment plans. However, you may face penalties and fees.

Even if you can’t pay your taxes, you must report the income and file tax returns. The federal government can charge you with crimes for failing to file taxes, and obviously, falsifying your tax returns can also result in charges.

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Supply chain woes hit small businesses

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Supply chain issues have caused problems for companies big and small. This October, at least 60 cargo ships idled off the California coast, waiting for berths to open up so they could drop off cargo. Costs to ship a single cargo container from China to the west coast of the U.S. rose from $3,000 to $20,000.

A National Federation of Independent Business survey in September found that 55 percent of small businesses reported that supply chain issues were worsening.

A Congressional report concluded that COVID-19 lockdowns caused many of the initial problems.

The U.S. Census Bureau’s Small Business Pulse Survey found 45 percent of businesses reported delays from domestic suppliers and nearly 20 percent reported delays from foreign suppliers.


Ultimately, supply and product woes will likely impact the bottom line. Small businesses, already facing tight profit margins and rising overhead from labor and other expenses, may struggle to absorb the additional costs.

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Smart TVs offer savvy advertising channels for small businesses

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We’ve got apps on our phones, apps on our computers, and now, we even have apps on our televisions. And if there’s an app, there may be a business opportunity. Smart TVs may offer ways for businesses big and small to connect with customers.

More devices are becoming “smart,” which, among other things, means they’re connected to larger networks (such as the Internet). Modern TVs are loaded with streaming apps, like Netflix or Peacock. Meanwhile, online retailers and others are offering apps too.

Take Amazon, for example. The online retail behemoth spent $11 billion on video and music content in 2020, up from $7.8 billion the year before. To put that in context, Netflix spent $10.81 billion on content in 2020 and $9.22 billion in 2019.

Why is Amazon spending so much on media content? Part of it is to advertise goods sold on Amazon through video and music ads. The small businesses that sell their goods through Amazon’s marketplace can pay for ads to get their products in front of customers.


Peacock and other platforms also allow small businesses to buy ad space. Traditional TV ads are expensive and collecting data is difficult. We can estimate how many people watch a given show through surveys. However, it’s challenging to gather more specific data, like who purchased a product due to a commercial.

With digital apps and platforms, it’s possible to measure and define customer actions. With an app, you can track when a customer clicks on an ad and buys a product. Rather than paying for commercial spots, businesses can pay for results, such as click-throughs or sales.

As smart TVs take over the living room, instead of merely showing a customer an ad for your awesome local pizza parlor, you can get them to order delivery right from their TV. Or when Amazon launches its upcoming Lord of the Rings series, small businesses selling on Amazon might advertise swords, independently published fantasy novels, and other related products.

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Thank You to our Local Business Participants:

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Apple Dumpling Learning Center

Apple House

Auto Care Clinic

Blue Ridge Arts Council

Blue Ridge Education

BNI Shenandoah Valley

C&C's Ice Cream Shop

Code Ninjas Front Royal

Cool Techs Heating and Air

Down Home Comfort Bakery

Downtown Market

Dusty's Country Store

Edward Jones-Bret Hrbek

Family Preservation Services

Front Royal Women's Resource Center

Front Royal-Warren County Chamber of Commerce

Gourmet Delights Gifts & Framing

Green to Ground Electrical

Groups Recover Together

I Want Candy

I'm Just Me Movement

Jen Avery, REALTOR & Jenspiration, LLC

Main Street Travel

Makeover Marketing Systems

Marlow Automotive Group

Mary Carnahan Graphic Design

Mountain Trails

National Media Services

Ole Timers Antiques

Phoenix Project

Reaching Out Now

Royal Blends Nutrition

Royal Examiner

Royal Oak Bookshop

Royal Oak Computers

Royal Oak Bookshop

Royal Spice

Salvation Army

SaVida Health

Skyline Insurance

St. Luke Community Clinic

Studio Verde

The Studio-A Place for Learning

The Valley Today - The River 95.3

The Vine and Leaf

Warren Charge (Bennett's Chapel, Limeton, Asbury)

Warren County Department of Social Services

Warrior Psychotherapy Services, PLLC

What Matters & Beth Medved Waller, Inc Real Estate

White Picket Fence

Woodward House on Manor Grade

King Cartoons

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Upcoming Events

Jan
28
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12:30 pm Free REVIVE! Opioid Overdose and... @ ONLINE
Free REVIVE! Opioid Overdose and... @ ONLINE
Jan 28 @ 12:30 pm – 1:30 pm
Free REVIVE! Opioid Overdose and Naloxone Education @ ONLINE
Northwestern Prevention Collaborative, in conjunction with Northwestern Community Services Board, will offer a free, virtual REVIVE! Training on January 28th from 12:30 pm to 1:30 pm. The one-hour online class provides an overview of how[...]
Jan
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3:00 pm Virtual Financial Services Workshop @ ONLINE
Virtual Financial Services Workshop @ ONLINE
Jan 31 @ 3:00 pm – 4:00 pm
Virtual Financial Services Workshop @ ONLINE
People Incorporated is cohosting a virtual financial services workshop for small business owners to learn about business loans, technical assistance, training, and other services provided by the agency. The workshop is scheduled for Monday, Jan.[...]
Feb
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6:30 pm Front Royal Wednesday Night Bingo @ Front Royal Volunteer Fire Deptartment
Front Royal Wednesday Night Bingo @ Front Royal Volunteer Fire Deptartment
Feb 2 @ 6:30 pm – 9:30 pm
Front Royal Wednesday Night Bingo @ Front Royal Volunteer Fire Deptartment
Bingo to support the American Cancer Society mission, organized by Relay For Life of Front Royal. Every Wednesday evening Early Bird Bingo at 6:30 p.m. Regular Bingo from 7-9:30 p.m. Food and refreshments available More[...]
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all-day First Friday @ Downtown Main Street
First Friday @ Downtown Main Street
Feb 4 all-day
First Friday @ Downtown Main Street
Come celebrate First Friday! Downtown businesses will be open late, until 8 p.m., on the first Friday and Saturday of each month.
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all-day First Friday @ Downtown Main Street
First Friday @ Downtown Main Street
Feb 5 all-day
First Friday @ Downtown Main Street
Come celebrate First Friday! Downtown businesses will be open late, until 8 p.m., on the first Friday and Saturday of each month.
9:00 am Women’s Wellness Workshop @ ONLINE
Women’s Wellness Workshop @ ONLINE
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Women's Wellness Workshop @ ONLINE
Women’s Wellness Workshop – Virtual via Zoom Webinar – Key Note Speaker Dr. Neema. Registrations will begin January 5: frontroyalwomenswellness.com
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Astronomy for Everyone @ Sky Meadows State Park
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Astronomy for Everyone @ Sky Meadows State Park
Historic Area: Discover our International Dark-Sky Park! Our evenings begin with a half-hour children’s “Junior Astronomer” program, followed by a discussion about the importance of dark skies and light conservation. Then join NASA Jet Propulsion[...]
Feb
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6:30 pm Front Royal Wednesday Night Bingo @ Front Royal Volunteer Fire Deptartment
Front Royal Wednesday Night Bingo @ Front Royal Volunteer Fire Deptartment
Feb 9 @ 6:30 pm – 9:30 pm
Front Royal Wednesday Night Bingo @ Front Royal Volunteer Fire Deptartment
Bingo to support the American Cancer Society mission, organized by Relay For Life of Front Royal. Every Wednesday evening Early Bird Bingo at 6:30 p.m. Regular Bingo from 7-9:30 p.m. Food and refreshments available More[...]
Feb
12
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10:00 am Winter Tree Identification Workshop @ Sky Meadows State Park
Winter Tree Identification Workshop @ Sky Meadows State Park
Feb 12 @ 10:00 am – 2:00 pm
Winter Tree Identification Workshop @ Sky Meadows State Park
Winter Tree Identification Workshop: Botany and Bloom Series Historic Area Even after the chilly breezes of autumn have stripped them of their leaves, trees provide clues to their identification by way of their bark, leaf[...]