AT&T to exit pay phone business in 2008

AT&T Inc. will exit the rapidly shrinking pay phone business by the end of next year, before it becomes unprofitable, the company said Monday.

AT&T will sell 65,000 pay phones, in prisons and in public places, within its original 13-state area before the end of 2008, said spokesman Michael Coe.

AT&T decided to leave pay phones, a tiny portion of the telecommunications company that has 67.3 million wireless subscribers, before they reached the point of being unprofitable, he said.

AT&T officials said they expect the pay phones to be purchased by independent operators.

"This business has been shrinking rapidly," said Coe, who said the company has been phasing out of the business by not renewing contracts as they've expired. "We've known for a while that we would exit."

The pool of pay phones nationwide has shrunk from 2.6 million to 1 million in the last decade.

BellSouth Corp., which AT&T acquired at the end of 2006, already exited the business, as has Qwest Communications International Inc.

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