What happens when the AT&T puzzle goes to pieces

PACIFIC*TELESIS Pacific Telesis Group, the new name for the holding company that includes Pacific Telephone and Nevada Bell, has an image that's difficult to erase - that of the poor man.

''Back in '80, '81 we were not quite as modern as the rest of the Bell system ,'' admits Donald Guinn, the designated chairman and chief executive at Pac Tel. ''We were in serious financial difficulty.'' But now ''we are in the strongest position this company has ever been in,'' Mr. Guinn says.

Since 1978, the company has invested over $2 billion annually in modernization and new equipment. Three years ago, it was financing only 44 percent of these capital outlays internally. Last year it handled 81 percent of that spending through its own company resources. Pac Tel has also been working with an outside consulting firm to streamline management and reorganize the company.

The group has enjoyed two big breaks. Last December Congress rubbed out $1.5 billion in back taxes from Pac Tel's balance sheet. And AT&T has agreed to assume a large chunk of Pac Tel's debt.

But there still is a big tangle to unsnarl. Pac Tel has asked its state utility commissioners to prohibit certain long-distance companies from providing service within the state. Pac Tel says it will lose $700 million in revenues if the companies are allowed to enter, forcing major rate increases to cover all costs of that service. No decision has been reached by the regulators so far.

Pac Tel will begin the new year with $16 billion in assets and a cellular mobile phone service business, directory publishing business, and phone equipment sales business. Guinn says the company is still looking around for other substantial service-oriented subsidiaries to aquire, and is eying the Pacific Basin as a new business area. USWEST

Yee-hah! US West likes to think it's got a prizewinning herd in its corral.

The Denver-based holding company has set the image of a frontier company with room to grow. It will break into divestiture with three autonomous phone companies (which will keep their Bell names) and four new subsidiaries: one to offer cellular mobile phone service; one to publish the phone book and Yellow Pages; one to lay cable, wire new premises, and provide consulting and engineering services; and one to sell phone equipment to businesses.

''We want US West to be more than just a telephone company,'' says Jack MacAllister, designated chief executive officer. The holding company, which starts Jan. 1 with $14 billion in assets, will lasso other communications-related businesses by joint venture, partnership, or acquisition.

Of the company's strengths, ''land is probably the most valuable,'' Mr. MacAllister says. ''We are standing right in a path of growth in the United States.'' He points to US Department of Commerce figures that say the area served by US West, the largest of the holding companies, will grow faster than the nation in personal income, population, and jobs.

Of all that land, MacAllister says, ''We've pretty much already wired those open spaces.'' Capital spending reached a hefty peak of $2.4 billion in 1981. It's on the way down and is now internally financed, he says.

The thunderstorm looming on the US West skyline is not rates, or competitors, or other ''tough issues that I recognize,'' the executive says, but the ability to bury AT&T's noncompetitive, monopolistic culture and establish a new, lively corporate culture. MacAllister wants to give employees more responsibilities and foster entrepreneurship. He's considering an employee stock ownership plan for US West too. Southwestern Bell Corporation

If any holding company should be concerned about the regulatory environment, it's Southwestern Bell. Headquartered in St. Louis, Southwestern has asked state regulators for a total rate hike of $2.6 billion - the largest request in the industry.

After divestiture, Southwestern Bell will keep 46 percent of its revenues. It's seeking the rate increases to cover lost long-distance revenue; to ease the ''lingering'' effects of inflation and high interest rates; and to make up for a faster depreciation schedule, which reduces profits in the short term. The company wants a rate of return that will attract investors, explains Zane Barnes , chief executive officer.

Andrew Silton, an analyst at First Albany Corporation, says Southwestern will be ''on average more vulnerable'' than other regionals when it loses long-distance revenue as a result of the breakup, because that revenue has played a larger role here.

Similar to the other regional holding companies, Southwestern starts with $17 .5 billion in assets. It also will have three new subsidiaries: cellular mobile phone; Yellow Pages; and phone equipment for business customers.

But it has a strength most other regions don't. ''We don't have to change our geographic arrangement,'' Barnes comments. While other holding companies have to figure out how to put three or four phone companies under one roof, Southwestern Bell is made up of only one phone company. Officer positions will remain largely unchanged.

Barnes says another strength is that ''we're in one of the highest growth territories in the country.'' Texas, for instance, has been a leader in housing starts. ''Of course growth itself doesn't guarantee success,'' he says; ''you have to get the proper regulation of rates.'' BELLSOUTH

When stock analysts think of BellSouth, flashy electronics frequently come to mind.

One reason is that last year, Southern Bell (which will be a BellSouth subsidiary), AT&T, and Knight-Ridder all got together to provide Coral Gables, Fla., with videotex - which allows a resident to do things like banking and catalog shopping at home by using a small terminal attached to a TV set. Knight-Ridder provided the information; Southern Bell transmitted it; and AT&T supplied the terminals. The company will go commercial with the experiment this fall.

Southern Bell has also been experimenting with utilities in North Carolina to allow customers to turn their power or appliances off and on over the phone.

Wallace Bunn, designated chief executive officer, says BellSouth is getting ''more inquiries than we can handle'' from outside companies interested in joint ventures. For instance, cable TV companies ''would like us to provide and install and maintain their facilities,'' he explains.

BellSouth has been gearing up to handle these kinds of demands by sinking $3 billion a year for the last five years into new equipment and plant modernization. That kind of spending has made BellSouth one of the most modernized of all the regionals, says Interstate Securities analyst Don Raines.

This regional company has the best profit record and most assets of any of the regionals - $21.5 billion. It will also be in the directory publishing, cellular mobile phone, and phone equipment sales business. BellSouth is slimming down by consolidating the research and development, marketing support, personnel management, and administrative services of its two phone subsidiaries into one company. AMERITECH

Think of the Midwest, and you think of a recession-struck economy. Will that hurt Ameritech, the Midwest regional holding company? Not really, answers William Weiss, the designated chief executive officer.

''Even though the Midwest tends to be economically depressed, it's in the midst of an exploding industry - the information industry,'' he says. Growth will come from the financial, industrial, and service businesses of the Midwest cities - not from population growth.

''You can say Detroit has economic problems,'' Mr. Weiss says, ''but Detroit has General Motors. It has Chrysler. It has Ford. It has a lot of industries that want very much to efficiently handle the information flow in their business , and that's what we're good at.''

Ameritech will start the new year with more than $17 billion in assets, five local telephone companies, and two other subsidiaries. One will handle equipment buying and servicing. The other will provide cellular mobile phone service. It will likely be the first regional to get the new phone service going - which it expects to do in Chicago this fall.

Weiss emphasizes that phone service ''will remain at the forefront'' of company goals. But Ameritech is working on joint ventures with alarm companies to monitor signals coming over phone lines. Cable TV projects are a possibility, too.

Weiss likes to point out that Ameritech's costs are in check. The company has 10,000 fewer people now than last year. Costs per access line are about 20 percent lower than the industry average. One reason is that the Midwest doesn't have the growth of new customers the Sunbelt has, which is expensive if it means laying new access lines.

Despite cost advantages, though, the Midwest has shown the lowest five-year average growth in revenues (9.6 percent) and earnings (6 percent) of all the regions. BELL ATLANTIC

''We are going to become a full, total, high-value communications company,'' says Thomas Bolger, chief executive officer designate of Bell Atlantic. His claim doesn't sound much different from the proclamations of other regional holding company leaders.

But Mr. Bolger thinks his company - which will oversee seven local phone companies - has a head start.

''We are blessed with a very close proximity and direct dealings with Bell Labs (the research and development arm of AT&T). We have been the trial (ground) for almost all of the leading-edge technologies.''

New Jersey Bell (which will be a Bell Atlantic subsidiary) was the first to go over to electronic switching, he says, and now 95 percent of Bell Atlantic switching is electronic. New Jersey Bell is also working on a videotex experiment in New Jersey, similar to the Southern Bell test.

Slow growth in the residential market (meaning low capital outlay), plus modernization, has made Bell Atlantic ''the lowest-cost'' of the regionals, Bolger says. This means that ''we're going to be able to keep our price increases down relative to the rest of the country,'' he adds.

Even with seven companies to manage, Bolger says he appreciates the diversity this gives his company. Strong earners, like New Jersey Bell, can offset weaker ones.

But Bolger doesn't deny that seven is a lot, and that's why Bell Atlantic has been consolidating more than the other regionals. It has created a separate management services company which will centralize the sales force, marketing, and other operating and staff functions.

Bell Atlantic will enter divestiture with $18 billion in assets and two subsidiaries: the mobile phone company and the services company. NYNEX

Executives at NYNEX (pronouned ''nine-x'') talk up the advantages of the Northeast region. ''Finance, insurance, real estate, education, tourism. Look at those collections of customer groupings. They're very communications intensive, '' says William Burns, chief financial officer of NYNEX. Mr. Burns also likes the stable economy in the region.

Burns says the markets NYNEX serves ''are exciting enough to be attracting other top-quality suppliers of similar services,'' and the company is concerned over competitors. Business customers and data communications are the fastest-growing segments for the company, says Burns.

Analysts agree with NYNEX executives that bypass is a major concern here. (With bypass, customers find their own way, via microwave or cable, to link up with a long-distance carrier. They thus avoid using the phone company to make the connection.)

Analysts also don't like what they see in management. Apparently, New England Telephone and New York Telephone have been resisting their prearranged marriage.

''What you have here are two companies reluctantly put together. It's a cultural nightmare,'' comments one Wall Streeter, who asked not to be named. The issue is important ''if you're going to have a smoothly working organization with a lot of synergy between one piece and the other.'' He has put NYNEX in the bottom half of his breakup stock picks.

Still, Andrew Silton, an analyst with First Albany Corporation, likes this region because there is little population growth, resulting in ''a lot of business revenue without having to put in new wire.''

NYNEX won't look very different from other regional holding companies in terms of assets and subsidiaries. It will start the new year with $18.7 billion in assets and have three subsidiaries to offer cellular mobile phone service, publish directories, and sell phone equipment to business customers.