Tuesday, March 20, 2007

Telephone expansion

Once Bell's patent monopoly expired in 1894, competition among independent companies brought about a major increase in telephone development. Independents concentrated their growth in small towns among the North Central states. In addition, development increased through "cooperatives". These coops were started by small groups of farmers. They were governed by elected boards and their goal was to keep costs to a minimum. In order to do this they utilized fence wire for transmission, party lines and did their own maintenance. As we have learned, competition is a good thing. During this time period, prices for telephone service decreased. Bell was under pressure to become more efficient and more creative in devising equipment. He developed a less expensive phone for rural service. In 1894 the 285,000 telephones were mostly Bell phones as compared to 1904, where the total reached 6.1 million, nearly half belonging to independents.


At 9:18 PM, Blogger A. Mattson said...

A very good post.

Local cooperative telephone companies may have worked well for local service but what about long distance? What kinds of Americans were interested in long distance?

Why didn't those local cooperatives and small town phone companies survive?

Was it inevitable that the telephone business became a monopoly? Should the government have prevente this?


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