That is a misnomer. In the old days you subscribed to telephone service. That included the telephone line and one telephone. An extension cost $1 a month extra. So that $14,000 over 42 years was for the service not the leased telephone. There is no way they paid $28 a month for 42 years for a leased telephone.
The widely publicized calculation stems from a viral news story from 2006 involving a widow named Ester Strogen. Her family discovered she had been continuously
leasing two rotary dial telephones from AT&T for 42 years.
The total cost—which actually came out to
more than $14,000 by the time the lease was canceled—was calculated based on the following legacy telecom structure:
- The Monthly Fee: At the time her granddaughters discovered the charges, the ongoing leasing fee was $29.10 per month for the two outdated phones.
- The Math: Over 42 years (504 months), paying roughly $24 to $30 a month accumulates to between $12,000 and $14,600 ($29.10 × 504 months = $14,666.40).
Why did this happen?
Prior to the landmark breakup of AT&T ("Ma Bell") in 1984, consumers were legally
not allowed to own their phones; they were required to lease them directly from the phone company.
When the laws changed and phone ownership became legal, AT&T spun off its rental division into a company called QLT Consumer Lease Services. Millions of customers, particularly elderly individuals who were used to seeing a single unified phone bill, simply never realized that the small recurring "equipment lease" line-item could be canceled by buying a cheap phone at a retail store.
Yes, leasing absolutely cost that much in reality, and the math is entirely accurate. However, the calculations performed by the family did contain one major historical nuance:
they multiplied the final 2006 rate across all 42 years, which means the actual total cash paid out was likely a bit lower.
The original viral story focused on 82-year-old widow Ester Strogen from Canton, Ohio, who paid
$29.10 a month for two black rotary phones until her family intervened in July 2006.
The reality behind how the cost reached that staggering total breaks down into two distinct phases:
Phase 1: The Historical Base Rate (1960s – 1984)
When Strogen first got the phones in the 1960s, renting was a legal mandate and cost a fraction of the 2006 price—usually just a few dollars a month.
- The "Insurance" Mirage: In exchange for that fee, Ma Bell promised free, lifetime maintenance. If the phone broke, they replaced it instantly at no extra cost.
- The Cost-Plus Reality: Because these solid-state phones were built like tanks out of heavy plastic and steel, they almost never broke. Consumers paid a continuous premium for decades for a repair service they rarely used.
Phase 2: The Deregulation Rate Hikes (1984 – 2006)
After AT&T was forced to break up its monopoly in 1984, the rental side of the business was shifted to Lucent Technologies and later a legacy holding company. To maximize profit off a shrinking customer base, they steadily
increased the monthly rental fees over the next 20 years.
- By 2006, the rental cost had quietly ballooned to roughly $14.55 per phone per month.
- When the family discovered the $29.10 monthly charge, they looked back at the 42-year span and estimated the collective loss at over $14,000.
Even adjusted for historical inflation—where $2 a month in 1964 had the purchasing power of roughly $20 today—Ester Strogen and hundreds of thousands of other elderly Americans realistically paid thousands of dollars out-of-pocket for standard desk phones they could have purchased at retail for $10.
The exact out-of-pocket dollar amount Ester Strogen paid over those 42 years
was never publicly determined, as neither AT&T nor the family had access to monthly billing records stretching all the way back to the 1960s.
The figures reported in the media are entirely
mathematical estimates based on the 2006 rate. The two primary numbers used to define the "cost" are:
- The Stated Media Total: More than $14,000.
- The Exact Family Formula: $14,666.40. This was derived by taking her final recorded bill of $29.10 per month and multiplying it across the full 42 years (504 months).
What the True Cash Cost Likely Was
Because AT&T did not charge $29.10 a month back in 1964, the true historical cash sum she handed over was lower than $14,000. In the 1960s and 1970s, basic phone lease fees were generally bundled into standard service or itemized at just
$1.00 to $2.00 a month per phone.
If we realistically assume she paid lower base rates for the first 20 years before the post-1984 deregulation price hikes took effect, a realistic estimate of the actual cash paid is between
$5,000 and $7,000.
The Real Cost When Adjusted for Inflation
While the family's $14,000 calculation overestimates the raw cash paid, it actually
underestimates the true economic damage when factoring in the time value of money.
Paying $2.00 a month for equipment in 1964 sounds minor, but due to severe inflation during the 1970s, those early single dollars had the purchasing power of roughly
$20.00 each in 2006 terms. If you adjust every historical lower monthly payment upward to account for inflation, Ester Strogen realistically lost the equivalent of
well over $15,000 in modern purchasing power by renting instead of buying.