Maverick entrepreneur who changed the shape of the nation's telephone industry, bringing lower cost long-distance service to millions of American households and businesses.
Mr. McGowan successfully challenged the monopoly of the American Telephone and Telegraph Company in Federal court and in the marketplace. MCI's antitrust suit against A.T.& T. in 1974, joined by the Justice Department, led to the breakup of Ma Bell a decade later, with A.T.& T. supplying long-distance service and seven regional companies, known as the Baby Bells, providing local phone service.
Mr. McGowan received a degree in chemical engineering from Kings College in Wilkes-Barre, Pa., paying his way by working nights as a freight dispatcher for the Central Railroad of New Jersey. He then went on to Harvard Business School, graduating in the class of 1954. Eventually, he set himself up in New York City as a consultant rescuing troubled companies, mainly in the garment district.
Mr. McGowan became involved in the long-distance telephone business by happenstance in 1968. Jack Goeken, an entrepreneur, had founded a company, Microwave Communications Inc., that offered radio-telephone service to trucks traveling between Chicago and St. Louis. But the company needed approval of the Federal Communications Commission to establish its microwave system; A.T.& T., with its virtual monopoly on long-distance service, opposed the plan.
Mr. McGowan saw the potential in the fledgling company, so much so that he bought half of it for $50,000 in 1968, incorporated it as a new company, the MCI Communications Corporation, and became its chairman. MCI's growth was financed partly by the high-yield securities sold by Michael Milken's operation at Drexel Burnham Lambert Inc.
Mr. McGowan, who lived in Washington and in Virginia Beach, was survived by his wife, Sue Ling Gin, three brothers and a sister.more » « less