Back in 1997 the incumbent local exchange carriers were having a problem.
Actually it goes back further than that. As it was told to me in 1989, in the mid-'80s, a Southwestern Bell Telephone exec gave a presentation at the Fort Worth, Texas L.D. Bell High School explaining how a home user's dial-up modem used longer connect times and users should be charged more for a "computer phone line".
I think that you are referring to the disagreement and legal battle between the Incumbent Local Telephone Companies and GTE Telenet because of the long holding times on calls to the Telenet Modem Pools.