A Brief Telephone History

Alexander Graham Bell

Alexander Graham Bell’s patent for the telephone, U. S. Number 174,465 was issued by the patent office on March 7th, 1876.  It has been called the most valuable patent ever issued.  In 1976, exactly 100 years after the patent was issued, AT&T stood as the richest company on earth.  Today, the telephone is unquestionably the most important invention of all and the stories of how it all began are fascinating.

When Bell’s attorney filed his application at the patent office on February 14th, 1876, it came only hours before Elisha Gray filed his Notice of Invention for a telephone.  Mystery still surrounds Bell’s application and what happened that day.  In particular, the key point to Bell’s application, the principle of variable resistance, was scribbled in a margin, almost as an afterthought. Some think Bell was told of Gray’s Notice then allowed to change his application. That was never proven, despite some 600 lawsuits that would eventually challenge the patent, all of which Bell won.

Finally, on March 10, 1876, one week after his patent was allowed, in Boston, Massachusetts, at his lab at 5 Exeter Place, Bell succeeded in transmitting speech. He was not yet 30. Bell used a liquid transmitter, something he hadn’t outlined in his patent or even tried before, but something that was described in Gray’s Notice.

Progress came slowly after the original invention. Bell and Watson worked constantly on improving the telephone’s range. They made their longest call to date on October 9, 1876. It was a distance of only two miles, but they were so overjoyed that later that night they celebrated, doing so much dancing that their landlady threatened to throw them out. Watson later recalled “Bell . . . had a habit of celebrating by what he called a war dance and I had got so exposed at it that I could do it quite as well as he could.” [Watson] The rest of 1876, though, was difficult for Bell and his backers.

Bell and Watson improved the telephone and made better models of it, but these changes weren’t enough to turn the telephone from a curiosity into a needed appliance. Promoting and developing the telephone proved far harder than Hubbard, Sanders, or Bell expected. No switchboards existed yet, the telephones were indeed crude and transmission quality was poor.

Many questioned why anyone needed a telephone. And despite Bell’s patent and the 17-year window of patent protection, broadly covering the entire subject of transmitting speech electrically, many companies sprang up to sell telephones and telephone service. In addition, other people filed applications for telephones and transmitters after Bell’s patent was issued. Most claimed Bell’s patent couldn’t produce a working telephone or that they had a prior claim. Litigation loomed. Fearing financial collapse, Hubbard and Sanders offered in the fall of 1876 to sell their telephone patent rights to Western Union for $100,000.

In one of the greatest miscalculations in history, Western Union said no.  Instead, Western Union believed that the telegraph, not the telephone, was the future.  Legend has it that the Western Union committee appointed to investigate the offer filed the following report:

“We do not see that this device will ever be capable of sending recognizable speech over a distance of several miles. Messer Hubbard and Bell want to install one of their ‘telephone devices’ in every city. The idea is idiotic on the face of it. Furthermore, why would any person want to use this ungainly and impractical device when he can send a messenger to the telegraph office and have a clear written message sent to any large city in the United States? … Mr. G.G. Hubbard’s fanciful predictions, while they sound rosy, are based on wild-eyed imagination and lack of understanding of the technical and economic facts of the situation, and a posture of ignoring the obvious limitations of his device, which is hardly more than a toy … This device is inherently of no use to us. We do not recommend its purchase.”      (As reported in the book “Bell” by Robert V. Bruce)

One year later, in September, 1877 Western Union changed its mind when one of its subsidiaries, the Gold and Stock Telegraphy Company, ripped out their telegraphs and started using Bell telephones. Rather than buying patent rights or licenses from Bell Telephone, Western Union decided to buy patents from others and start their own telephone company. They were not alone. At least 1,730 telephone companies organized and operated in the 17 years Bell was supposed to have a monopoly.

On April 27, 1877 Thomas Edison filed a patent application for an improved transmitter, a device that made the telephone practical. A major accomplishment, Edison’s patent claim was declared in interference to a Notice of Invention for a transmitter filed just two weeks before by Emile Berliner. This conflict was not resolved until 1886, however, Edison decided to produce the transmitter while the matter was disputed. Production began toward the end of 1877. To compete, Bell soon incorporated in their phones an improved transmitter invented by Francis Blake.

Most competitors disappeared as soon as the Bell Company filed suit against them for patent infringement, but many remained. They either disagreed with Bell’s right to the patent, ignored it altogether, or started a phone company because Bell’s people would not provide service to their area.

In any case, Western Union began entering agreements with Gray, Edison, and Amos E. Dolbear for their telephone inventions. In December, 1877 Western Union created the American Speaking Telephone Company. A tremendous selling point for their telephones was Edison’s improved transmitter. Bell Telephone was deeply worried since they had installed only 3,000 phones by the end of 1877.

Western Union, on the other hand, had 250,000 miles of telegraph wire strung over 100,000 miles of route. If not stopped they would have an enormous head start on making telephone service available across the country. Undaunted by the size of Western Union, then the world’s largest telecom company, Bell’s Boston lawyers sued them for patent infringement the next year.

On November 10, 1879 Bell won its patent infringement suit against Western Union in the United States Supreme Court.  In the resulting settlement, Western Union gave up its telephone patents and the 56,000 phones it managed, in return for 20% of Bell rentals for the 17-year life of Bell’s patents.  It also retained its telegraph business as before.  The court’s decision made National Bell Company even bigger and resulted in a new entity with a new name.  American Bell Telephone Company was created on February 20, 1880, capitalized with over seven million dollars.  Bell now managed 133,000 telephones.

On February 26, 1882, Bell completed the takeover of Western Electric, a previous rival who had been making telegraph equipment for Western Union along with telephone equipment for others.  From the day of the takeover, Western Electric Company would only produce products exclusively for American Bell, and no one else.

In 1885, American Bell, still struggling to expand their telephone system beyond the big cities, launched a new long-distance company called American Telephone & Telegraph (AT&T).  Under the leadership of Theodore Vail, Bell was determined to take on Western Union’s long-distance dominance.  The next year, in 1886, AT&T introduced their very first long-distance telephone transmitter, and the race to build a nationwide long-distance telephone network had begun.

1886 long distance transmitter
AT&T's very first long distance telephone

The first consumer telephones were heavy wooden wall mounted hand cranked telephones. In 1892, one year before his patents began expiring, opening the door to competition, Bell introduced the first upright desk telephone or desk set, sometimes referred to as a “candlestick” telephone.  Bell knew that with intense competition on the horizon, his improved desk set needed to make a statement and gain mass appeal. I think his 1892 model was the most beautiful Bell Telephone ever produced.

During 1893-1894, Bell’s original telephone patents expired, opening the door to competition. Several thousand independent telephone companies quickly emerged across the country with a wide-ranging variety of all-new uniquely designed upright telephones.  All of them claiming to have better quality and provide better service than Bell telephones. Independents quickly gained an advantage as the number of independent telephones numbered 2,000,000 while Bell managed 1,278,000.

As competition grew, prices to consumers were coming down, telephone service was expanding rapidly and businesses and consumers were able to purchase the telephone of their choice.

There were over twelve thousand independent telephone companies providing telephone service in communities all over the U.S. by the early 1900s, but by 1912, Bell/AT&T monopoly tactics proved fatal for most or resulted in consolidation and a short life span for the rest. As a result, only limited documentation exists on many of the early telephone companies and the phones they manufactured. (For more history, please see the link on the Bell/AT&T monopoly)

I hope you enjoy the photographs of the telephones in this collection. Thank you for spending some time viewing this site, I hope you’ll visit often.

Sources for the stories in this history piece come from research in two primary places.  The Internet provided dozens of articles confirming the history and timeline of the telephone.  The other source is a wonderful book entitled: “The Tangled Web of Patent # 174,465, written by Russell A Pizer.

Special Thanks

Special thanks to Tom Adams, who knows more telephone history than anyone I know. Tom has always been there when I have a question or need a favor, and I’ve needed a bunch over the years.  And Scotty Poling who has worked tirelessly to assemble many of the ads and catalog cuts and has given permission for them to be used on this website.

And to all the telephone collectors, members of Antique Telephone Collectors Association (atcaonline.com) and Telephone Collectors International (telephonecollectors.org).  There isn’t a better addiction in the world than the search for old telephones!