Can you imagine not being able to call a German phone number from the US?
AT&T's telephones still had to interoperate with (e.g.) the British Post Office's phones (and everybody else's) to remain relevant/useful. AT&T was very far from controlling all telephony equipment in the whole world.
For much of the 20th century there was exactly one phone company in the US, and it insisted on total control of all equipment connected to it. Even non-electrically connected mouthpieces. https://en.wikipedia.org/wiki/Hush-A-Phone_Corp._v._United_S...