AT&T finally sells phone book stake

Phone books are promptly delivered to my doorstep every year -- and they go right into the recycle bin.

It's a business with no future, especially as more and more people use the Internet and mobile phones to get phone numbers and addresses.

So why did AT&T (T) hold on to the Yellow Pages for so long?

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The telecommunications giant has finally agreed to sell a majority stake in the Yellow Pages to Cerberus Capital Management for $750 million in cash and a $200 million note, Bloomberg reports. AT&T will still own 47% of the business.

AT&T should have sold this asset off long ago, before the Yellow Pages plunged in value. Sales at the division fell 16% last year. In fact, AT&T was the last phone company hanging on to the directory business. Rivals like Verizon (VZ) got out at the right time.

But AT&T held on, even as customers fled. Now, as one analyst tells Bloomberg, "the transaction is barely material, either in the proceeds it returns or in the change it portends to AT&T's overall growth rate."

Some people still use the Yellow Pages. It has a remarkable shelf life in some homes, and it can be faster to open the phone book instead of searching for a phone number on the Internet. One expert tells Bloomberg that people use phone books in specialized cases, such as emergencies and around major life events.

"You are probably not going to find a roofer on your mobile device," said Dennis Fromholzer of CRM Associates, according to Bloomberg.

The Yellow Pages still brings in a boatload of advertising dollars. Its revenue last year topped $3.3 billion.

Still, that figure is all but guaranteed to drop. Its growth days are over. And the Yellow Pages' new majority owner will wring as much revenue from the directories as it can before dismantling the business.