The downward spiral started with the breakup... that replaced a single national entity with several and it was never the same after that.
ATT went nuts after the breakup. I accepted their offer for an ATT credit card to make calls from a hotel etc. Soon they revised the terms to $3.50/month fee if it wasn't used, so I started using it for general shopping. Next time I skipped using it in a month they billed $15 'non-use fee' including a threat to reduce my credit rating. I cancelled the card.
Also Southwest Bell started buying up the other regional Bells and imposing cost cutting. My local PacBell was now SWBell of San Antonio. In the early days of DSL I recall talking to a help desk tech who was outraged that with the changeover his internet access was dumbed down to a green-screen IBM terminal showing scripts for him to reply to the customer's question.
Then SWBell of San Antonio bought ATT, but only for the name. They released everyone from ATT and gave their own local staff the ATT job titles. 100 years of accumulated experience, gone.
The government's breakup of ATT is an interesting case study of lobbyist-written government controls versus free enterprise.
After the breakup, the ability to create an internet not limited by ATT and enforced by PUC rules opened up. Instead of the ATT-provided modem with PUC-guaranteed support for 300 baud (bit/second), inventors started encoding the data sent over the same lines and modem speeds soon evolved to 56,000 bits/second. A home connection to the internet became possible, first Fidonet etc over dialup within a group of users, then in another step Congress opened the internet beyond its initial military/government/university closed system and the pace of innovation exploded.
We live in a completely different world today. Compare visiting the city library and researching in Encyclopedia Britannica or the card catalog and finding very limited answers, vs looking for something in modern Wikipedia and Google. (Off topic - this progress hasn't improved family income for the majority of Americans).
Ok this is a very general discussion, I'm sure others know more precise versions of some details.
May you live in interesting times ....