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Long Lines: AT&T's Long-Distance Network as an Organizational and Political Strategy

Published online by Cambridge University Press:  13 December 2011

Robert MacDougall
Robert MacDougall
Affiliation:
ROBERT MACDOUGALL is assistant professor of history at the University of Western Ontario in London, Ontario.
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Abstract

The primary importance of long-distance telephone service to the American Telephone and Telegraph Company in the first two decades of the twentieth century was not commercial but organizational and political. The so-called Bell System was not a single firm before 1910 but was, rather, an association of regional companies with considerable autonomy. As AT&T's leaders worked both to overcome independent competitors and to curtail the autonomy of their own local affiliates, long-distance service offered them a powerful technological justification for the consolidation of control. Outside the Bell System, long distance also served as a vivid symbol of interconnection and integration. Long distance proved central to AT&T's campaign to convince Americans of its own legitimacy and that of nation-spanning corporations in general.

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Articles
Information
Business History Review , Volume 80 , Issue 2 , Summer 2006 , pp. 297 - 327
Copyright
Copyright © The President and Fellows of Harvard College 2006

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References

1 The inauguration of the transcontinental line was described in numerous company publications. See, for example, The Story of a Great Achievement: Telephone Communication from Coast to Coast (New York, 1915)Google Scholar; “Coordinating the Nation,” Telephone Review (Jan. 1915): 24; Pound, Arthur, The Telephone Idea: Fifty Years After (New York, 1926)Google Scholar; and Mills, John et al. , “A Quarter-Century of Transcontinental Telephone Service,” Bell Telephone Quarterly 19, no. 1 (1940)Google Scholar.

2 It is somewhat anachronistic to use the abbreviation “AT&T” for the American Telephone and Telegraph Company in this era; I do so only for brevity. Some documents in this era did refer to “the A.T. & T. Co.,” but the familiar acronym “AT&T” only came into general use in the 1930s or after.

3 The Story of a Great Achievement, 11-16.

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10 Williams, Thomas W., “Our Exhibits at Two Fairs,” Bell Telephone Quarterly 19, no. 1 (1940)Google Scholar. The real takeoff for long-distance telephony came during World War II, when many Americans had their first occasion to use the long-distance lines. Long-distance traffic in the United States would increase by more than 330 percent between 1939 and 1945. Bell System Statistical Manual (Warren, N.J., 1963), 1204Google Scholar.

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13 AT&T's major commercial reward for its coast-to-coast lines came with the rise of network radio broadcasting in the 1920s and 1930s, not from person-to-person calls but from the use of the lines to transmit radio programming between network affiliates.

14 See, for instance, Mills et al., “A Quarter-Century of Transcontinental Telephone Service.”

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19 Technically, the company Vail joined in 1878 was the Bell Telephone Company, not American Bell. The original Bell Telephone Company, founded in 1877, was reorganized as the National Bell Telephone Company in 1879 and again as the American Bell Telephone Company in 1880.

20 It is not clear when this vision was first born in Vail's mind. Sometimes he said it was “co-existent with the business.” At other times, he claimed he could not say with any certainty when the idea of “one great big general system” first came to him. Certainly, it was implied by the expansive language in AT&T's founding charter, written in 1885. Annual Report of the Directors of the American Telephone and Telegraph Company to the Stockholders, HBS, 1909, 18–19Google Scholar; New York State, Joint Committee of the Senate and Assembly Appointed to Investigate Telephone and Telegraph Companies, Report (Albany, N.Y., 1910)Google Scholar. The AT&T charter (quoted below) is reprinted in Rhodes, Frederick L., Beginnings of Telephony (New York, 1929), 196–97Google Scholar.

21 AT&T Annual Report, 1909, 18-19.

22 NTEA, Proceedings, 1885, 14-15. Emphasis in original.

23 Ibid., 62.

24 Annual Report of the Directors of the Southern New England Telephone Company to the Stockholders, 1885, quoted in Walsh, Connecticut Pioneers, 145-46.

25 Walsh, Connecticut Pioneers, 110-18, 136-47.

26 NTEA, Proceedings, 1885, 61. (AT&T did not offer telephone service between the United States and Japan until 1934.)

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30 Edward J. Hall Jr. to John E. Hudson, 21 Jan. 1888, box 1011, ATTA. See also Garnet, The Telephone Enterprise, 79-81.

31 Quoted in Brooks, John, Telephone: The First Hundred Years (New York, 1976), 85Google Scholar. Vail stayed on as president of New York's Metropolitan Telephone Company until 1889.

32 NTEA, Proceedings, 1889, 34-43.

33 Ibid., 44-45.

34 Ibid., 1890, 43-56. Angus Hibbard remarked on the novelty of Hall's charts in Hibbard, Angus Smith, Hello, Goodbye: My Story of Telephone Pioneering (Chicago, 1941)Google Scholar.

35 E. B. Field to John J. Carty, 8 Sept. 1909, box 2029, ATTA. Emphasis in original.

36 Federal Communications Commission, Proposed Report, Telephone Investigation (Washington, D.C., 1938), 26–28Google Scholar.

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39 See, for example, “Consolidation Talk,” New York Times, 3 0 Dec. 1899, 11. See also Stehman, Financial History of AT&T, 56-59; and MacMeal, Harry B., The Story of Independent Telephony (Chicago, 1934), 112Google Scholar.

40 Edward J. Hall Jr. to Theodore N. Vail, 27 Sept. 1909, box 1010, ATTA.

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42 Edward J. Hall Jr. to Frederick Fish, 30 Oct. 1902, ATTA.

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45 Nance and Oram, “The Circuits Go Up,” 23. On the technical history of the transcontinental line, see Jewett, Frank B., “Transcontinental Panorama,” Bell Telephone Quarterly 19, no. 1 (1940)Google Scholar; Fagen, ed., Engineering and Science in the Bell System, 195-348; Aitken, Continuous Wave, 233-45.

46 AT&T Annual Report, 1914, 42-43.

47 Everybody Join In: The Blue Bell Songbook (New York, [1920?])Google Scholar, Donald McNicol Collection, Queen's University Special Collections.

48 “The Telephone in Indiana,” Electrical World (26 Sept. 1885): 132.

49 Cumberland Telephone Journal (15 May 1903): 12.

50 Hume, quoted in Cumberland Telephone Journal (15 May 1903): 15. For Caldwell, see the Annual Report of the Directors of the Cumberland Telephone and Telegraph Company, HBS, various years.

51 James E. Caldwell to Cumberland Telephone and Telegraph Company stockholders, 27 Dec. 1911, HBS. Caldwell retired after writing this letter, and AT&T moved the headquarters of Cumberland Telephone and Telegraph from Nashville to Atlanta.

52 See, for example, Smith, Merrit Roe and Marx, Leo, eds., Does Technology Drive History? The Dilemma of Technological Determinism (Cambridge, Mass., 1994)Google Scholar.

53 The literature of scientific and systematic management was candid in asserting this goal. See, for example, Taylor, Frederick Winslow, The Principles of Scientific Management (New York, 1911)Google Scholar; Hoxie, Robert F., Scientific Management and Labor (New York, 1915)Google Scholar. On the balance of power in the American workplace, see Livingston, James, “The Social Analysis of Economic History and Theory: Conjectures on Late Nineteenth-Century American Development,” American Historical Review 92 (Feb. 1987): 69–95CrossRefGoogle Scholar; Montgomery, David, The Fall of the House of Labor: The Workplace, the State, and American Labor Activism, 1865-1923 (New York, 1987)CrossRefGoogle Scholar; Kanigel, Robert, The One Best Way: Frederick Winslow Taylor and the Enigma of Efficiency (New York, 1997)Google Scholar.

54 In 1907, the Bell System operated roughly 3,013,000 telephones and connected an average of 15,760,000 calls per day. Independent companies operated roughly 3,106,000 telephones and connected an average of 14,024,000 calls per day. U.S. Bureau of the Census, Historical Statistics of the United States, vol. 2 (Washington, D.C., 1975), 783Google Scholar.

55 U.S. Bureau of the Census, Telephones and Telegraphs and Municipal Electric Fire-Alarm and Police-Patrol Signaling Systems: 1912 (Washington, D.C., 1915), 35Google Scholar. Independent competition in American telephony has not been closely studied by historians. Many recent histories of the telephone, based on the corporate archives of AT&T, pay little or no attention to independent competition. Earlier works typically describe independent competition only to lament it as an error or aberration. Fischer, Claude S., “The Revolution in Rural Telephony, 1900-1920,” Journal of Social History 21 (Fall 1987): 5–26CrossRefGoogle Scholar, and Mueller, Milton L., Universal Service: Competition, Interconnection, and Monopoly in the Making of the American Telephone System (Cambridge, Mass., 1997Google Scholar), are both useful. The only really detailed histories of independent telephony, however, are celebratory works by self-interested participants. See MacMeal, The Story of Independent Telephony; Latzke, Paul A., A Fight with an Octopus (Chicago, 1906)Google Scholar; Pleasance, Charles A., The Spirit of Independent Telephony (Johnson City, Tenn., 1989)Google Scholar.

56 George Leverett to Frederick Fish, 17 Oct. 1901, box 1375, ATTA.

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58 If long-distance service was not the reason for the Bell System's eventual success against the independents, what was? A complete answer would go beyond the scope of this paper but must surely include a number of key patents, dominance of the country's most lucrative urban markets, a canny public-relations campaign, and a general preponderance of both economic and political clout.

59 William Crownover, “Should Independent and Mutual Companies Co-Operate,” Telephony (May 1907): 309; Dickson, Frederick S., “Telephone Investments—and Others,” (Cleveland, Ohio, 1905), HBS, 40Google Scholar.

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61 This argument is suggested in Lipartito, Kenneth, The Bell System and Regional Business: The Telephone in the South, 1877-1920 (Baltimore, 1989), 116Google Scholar.

62 G. F. Wonbacher, “Proper Development of the Rural Telephone,” Western Telephone Journal (July 1908): 242.

63 Charles E. Tarte, “Long Distance Service—Its Development and Possibilities,” Sound Waves, July 1907.

64 Walsh, Connecticut Pioneers, 126-27.

65 “The Central Union Telephone Company/Chicago Telephone Company,” 5-6. Some of Sabin's correspondence with American Telephone and Telegraph is in box 1313, AT&T Archives, Warren, N.J., but the exact circumstances of his resignation are unclear.

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68 On the “decentralized alternative” in another industry and in other countries, see Berk, Gerald, Alternative Tracks: The Constitution of American Industrial Order, 1865-1917 (Baltimore, 1994)Google Scholar; Davies, Andrew, Telecommunications and Politics: The Decentralised Alternative (London, 1994)Google Scholar.

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70 Ogle, Edmon B., Long Distance Please: The Story of the Trans Canada Telephone System (Toronto, 1979), 9Google Scholar; MacDougall, Robert, “The All-Red Dream: Technological Nationalism and the Trans-Canada Telephone System,” in Chapnick, Adam and Hillmer, Norman, eds., Cross-Currents: Twentieth-Century Canadian Nationalisms (Montreal, 2006)Google Scholar.

71 On the history of natural monopoly theory, see Sharkey, William W., The Theory of Natural Monopoly (Cambridge, U.K., 1982), 12–28CrossRefGoogle Scholar. On the difficulty of applying natural monopoly theory to the telephone, see Babe, Telecommunications in Canada, 137-49; Milton L. Mueller, Universal Service, 11-20.

72 Historical Statistics of the United States, 783.

73 “To Bring Telephone Suits,” New York Times, 22 Jan. 1909, 16; Lindemuth, A. C., Telephone Mergers Illegal (Chicago, 1911), TPH.Google Scholar

74 Babe, Telecommunications in Canada; Noam, Eli, Telecommunications in Europe (Oxford, 1992)Google Scholar.

75 Cohen, Jeffrey E., “The Telephone Problem and the Road to Telephone Regulation in the United States, 1876-1917,” Journal of Policy History 3, no. 1 (1991): 42–69CrossRefGoogle Scholar.

76 Postmaster General, Government Ownership of Electrical Means of Communication (Washington, D.C., 1914)Google Scholar. The AT&T memo is by Chester I. Barnard, “Review of the Government Ownership Situation,” 6 Mar. 1917, box 1364, ATTA.

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79 Thomas Haskell, Roland Marchand, Robert Wiebe, and others have argued that as the American economy and society became more obviously interdependent in the late nineteenth and early twentieth centuries, it became harder and harder to imagine individuals as solitary masters of their fates. Traditional sources of meaning and order close at hand—the family, the parish, the small community—lost “causal potency” as the prime movers of conditions and events receded farther and farther away. It was not the size or the tactics of large corporations that stirred protest in this era, Marchand argued. It was the ability of corporations and other nation-spanning organizations to act upon no-longer isolated “island communities” from a great geographic distance. Haskell, Thomas L., The Emergence of Professional Social Science: The American Social Science Association and the Nineteenth-Century Crisis of Authority (Chicago, 1977), 15, 40Google Scholar; Marchand, Roland, Creating the Corporate Soul: The Rise of Public Relations and Corporate Imagery in American Big Business (Berkeley, 1998), 2–5Google Scholar; Wiebe, Robert H., The Search for Order, 1877-1920 (New York, 1967)Google Scholar.

80 This contest also played out in other industries, of course. See, for example, Berk, Alternative Tracks; Schneiberg, Marc, “Organizational Heterogeneity and the Production of New Forms: Politics, Social Movements, and Mutual Companies in American Fire Insurance, 1900-1930,” Social Structure and Organizations Revisited 19 (2002)CrossRefGoogle Scholar. On correlations between trade networks and long-distance telephone lines, see Weiman, “Building Universal Service.”

81 Nathan C. Kingsbury, address before the Telephone Society of New York, 17 Feb. 1914, TPH, 3-6.

82 The quotations come from a letter Rockefeller wrote to a family adviser one week after the meeting. John D. Rockefeller Jr. to Frederick T. Gates, 27 July 1912, reprinted in Jordan, John M., “‘To Educate Public Opinion’: John D. Rockefeller, Jr. and the Origins of Social Scientific Fact-Finding,” New England Quarterly 64 (June 1991): 292–97CrossRefGoogle Scholar. Vail's proposals are described in Theodore N. Vail, “Memorandum Concerning a Proposed Economic Bureau,” Rockefeller Foundation Draft Report, Apr. 1914, quoted in Grossman, David M., “American Foundations and the Support of Economic Research,” Minerva 20 (Spring/Summer 1982): 59–82CrossRefGoogle Scholar. Discussions apparently trailed off, because Rockefeller wanted to create a research institute, while Vail and Morgan only wanted a public-relations bureau. See also Harr, John Ensor and Johnson, Peter J., The Rockefeller Century (New York, 1988), 127Google Scholar.

83 Marchand, Creating the Corporate Soul. See also James D. Ellsworth, “The Start of General Magazine Advertising,” Jan. 1931, box 1066, ATTA.

84 “Coordinating the Nation,” 24.

85 Griese, Noel L., Arthur W. Page: Publisher, Public Relations Pioneer, Patriot (Tucker, Ga., 2001)Google Scholar; Griese, Noel L., “James D. Ellsworth, 1863-1940: P. R. Pioneer,” Public Relations Review 4 (1978)CrossRefGoogle Scholar; Marchand, Creating the Corporate Soul, 48-87.

86 American Telephone and Telegraph Company, Telephone Almanac (New York, 1928)Google Scholar; “Coordinating the Nation,” 24.

87 AT&T Advertisements, Life, 15 Jan. 1914, 91; Life, 17 Dec. 1914, 1137.

88 The Kingsbury Commitment involved AT&T's promise to do three things: give up control of Western Union, sell the stock holdings in the telegraph company it acquired in 1909; agree to stop taking over competing independent systems; allow all independent systems that did not compete directly with Bell to connect to its long-distance lines. Nathan C. Kingsbury to Attorney General James C. McReynolds, 19 Dec. 1913. The letter is reprinted in AT&T Annual Report, 1913, 24-26.

89 Quoted in Marchand, Creating the Corporate Soul, 86.