WEBVTT - The AT&T Story - Part One 0:00:04.240 --> 0:00:07.200 Get in touch with technology with text stuff from how 0:00:07.280 --> 0:00:14.600 stuff Works dot com. Hay, then everyone, and welcome to 0:00:14.800 --> 0:00:17.760 tech Stuff. I'm Johnson Strickland and I'm learn And today 0:00:17.760 --> 0:00:19.800 we're going to look at a company that has been 0:00:19.840 --> 0:00:23.200 around for a really long time, very influential, so long 0:00:23.280 --> 0:00:25.480 in fact that we are probably going to do this 0:00:25.560 --> 0:00:30.080 in three parts. It's gonna be yes, A T and T, 0:00:30.320 --> 0:00:34.239 the American Telegraph and Telephone Company. Yep. Uh So A 0:00:34.360 --> 0:00:36.720 T and T has a very long history, and it 0:00:36.800 --> 0:00:39.639 first starts off with a couple of earlier companies. Now 0:00:39.680 --> 0:00:42.639 this is not something that's, you know, unusual. We've had 0:00:42.680 --> 0:00:45.199 other discussions about other companies that you know, you have 0:00:45.280 --> 0:00:48.200 to start with, like a like Seed Company and parents 0:00:48.320 --> 0:00:50.520 general General Electric. You know, you have to go back 0:00:50.600 --> 0:00:53.519 way before General Electric to really talk about the company. 0:00:53.640 --> 0:00:55.960 So in this case, we have to talk about a man, 0:00:56.720 --> 0:01:01.600 a man who has been credited officially and through other 0:01:01.640 --> 0:01:04.480 sources as the inventor of the telephone. Although, as we 0:01:04.600 --> 0:01:08.199 all know, when it comes to inventions, it's a lot true, 0:01:08.240 --> 0:01:10.520 it's very tricky to narrow it down to a single person, 0:01:10.600 --> 0:01:14.160 and it takes a research society to make a technology 0:01:14.280 --> 0:01:16.040 and turns out that there are a lot of people 0:01:16.080 --> 0:01:18.600 who are working on things all at the same time, 0:01:18.640 --> 0:01:22.440 and sometimes it's just the person who gets the first. 0:01:22.640 --> 0:01:25.399 In the case of Alexander Graham Bell, uh, not that 0:01:25.480 --> 0:01:29.000 he didn't work very hard and make great contributions. It's 0:01:29.000 --> 0:01:30.800 just that there were other people doing the same sort 0:01:30.840 --> 0:01:36.120 of stuff. Right. So in February, on February eighteen seventy six, 0:01:36.720 --> 0:01:39.120 that is when he filed this first pattern yep to 0:01:39.520 --> 0:01:43.160 a way to electronically transmit speech by quote causing electrical 0:01:43.240 --> 0:01:46.640 undulations similar informed to the vibrations of the air accompanying 0:01:46.680 --> 0:01:49.920 the said vocal or other sounds substantially as set forth 0:01:50.040 --> 0:01:55.040 end quote. Now, Uh, it's interesting he had already written 0:01:55.080 --> 0:01:58.640 the patent out earlier in January of that year, but 0:01:59.000 --> 0:02:02.960 there was a peculiar all you're sort of legal loophole 0:02:03.000 --> 0:02:05.400 that he had to leap through in order for him 0:02:05.440 --> 0:02:09.000 to get this patent recognized in not just the United States, 0:02:09.080 --> 0:02:12.240 but also the United Kingdom. See, the UK had a 0:02:12.360 --> 0:02:14.880 rule that stated if you wanted to patent something in 0:02:14.919 --> 0:02:18.560 the UK, it could not first have been patented anywhere else. 0:02:19.240 --> 0:02:21.560 So Graham Bell writes up this patent. He wants to 0:02:21.600 --> 0:02:24.120 get patented. He's ready to submit it, except that he 0:02:24.160 --> 0:02:27.320 first has to get over to the UK. And uh, guys, 0:02:27.360 --> 0:02:28.959 who don't know if you're familiar with us. In eighteen 0:02:29.000 --> 0:02:32.120 seventy six, there were very few options on how to 0:02:32.200 --> 0:02:34.960 get from say the United States to England that didn't 0:02:35.000 --> 0:02:38.120 involve a really long journey, right. It was basically swimming 0:02:38.120 --> 0:02:41.239 a horse right across that action. Yep, you just hitch 0:02:41.280 --> 0:02:44.200 a team of horses to a boat and say giddy up. 0:02:44.720 --> 0:02:47.200 I mean, we didn't really research that part, so we 0:02:47.320 --> 0:02:49.920 might be a little inaccurate. Make sure you tweet us 0:02:49.919 --> 0:02:52.960 and let us know. But no, no, I mean, you know, 0:02:53.040 --> 0:02:55.840 because the telecommunications were not a thing at this point, 0:02:55.880 --> 0:02:59.320 because he hadn't patented it yet, all right, So it 0:02:59.360 --> 0:03:01.560 was it was taken a while, and so, as it 0:03:01.600 --> 0:03:05.760 turned out, that very same day, another electrician began the 0:03:05.800 --> 0:03:08.480 filing process. I don't think actually file what he what 0:03:08.560 --> 0:03:12.000 he did. We're talking about Elisha Gray and Elishah Gray 0:03:12.120 --> 0:03:14.120 or or we'll just call him Gray because first of all, 0:03:14.160 --> 0:03:16.160 I assume it's Elisha. I did not look up at 0:03:16.200 --> 0:03:19.040 the pronunciation of his first name. But Mr Gray had 0:03:19.040 --> 0:03:23.240 submitted a preliminary application for a similar apparatus. It was 0:03:23.280 --> 0:03:27.000 also called a caveat. That was the technical name for 0:03:27.120 --> 0:03:31.720 the preliminary application. He submitted a caveat for consideration for 0:03:31.760 --> 0:03:35.520 a patent the very same day that Graham Bell posted 0:03:35.600 --> 0:03:38.560 it filed his patent, or technically Bell's lawyer filed the 0:03:38.600 --> 0:03:41.720 patn right here in the United States we're talking about, yes, exactly. 0:03:41.800 --> 0:03:45.640 So Gray applied for a pattern with a very similar idea, 0:03:45.840 --> 0:03:48.680 and the story goes and I don't know the truth 0:03:48.720 --> 0:03:51.240 of this, And in fact, I have proposed to Lauren, 0:03:52.000 --> 0:03:56.040 not romantically, I mean an episode title. I proposed to 0:03:56.080 --> 0:03:59.720 her that we actually cover the content the topic of 0:04:00.000 --> 0:04:04.720 Alexander Graham Bell and Elishah Gray, because the story about 0:04:04.960 --> 0:04:07.839 who got that patent is really interesting and I think 0:04:08.120 --> 0:04:12.280 could merit its own episode at any rate. Uh, the 0:04:12.320 --> 0:04:17.160 story is that Bell's lawyer got a look at Gray's application, 0:04:17.400 --> 0:04:22.120 which included an element that was not in Bell's work. 0:04:22.680 --> 0:04:25.560 But then when the patent was filed, there was a 0:04:25.560 --> 0:04:29.160 little scrawl in the margin that covered the same idea. 0:04:30.000 --> 0:04:34.279 So the story is that Bell's lawyer or perhaps Bell himself. 0:04:34.320 --> 0:04:37.960 It all depends upon the account you read lifted an 0:04:38.000 --> 0:04:42.400 idea directly from Gray's work in order to essentially beat 0:04:42.440 --> 0:04:47.640 him complete. So Bell's patent application goes in ahead of Gray's, 0:04:47.680 --> 0:04:51.440 and so Bell is at least initially awarded the patent. 0:04:51.480 --> 0:04:55.560 Although it was not uncontested. There was actually quite a 0:04:57.080 --> 0:04:59.799 vigorous battle in the legal system of that was gone 0:05:00.000 --> 0:05:05.120 a few years. And so moving ahead on in that 0:05:05.240 --> 0:05:08.719 same year March tenth, eighteen seventy six. Remember he's already 0:05:08.720 --> 0:05:10.960 filed the patent, but it was only on March tenth, 0:05:11.040 --> 0:05:14.920 eighteen seventy six that we had the famous message from 0:05:14.920 --> 0:05:18.599 Alexander Graham Bell to his assistant Thomas Watson. Mr Watson 0:05:18.640 --> 0:05:21.840 being in another room in the same building. Yeah, and 0:05:21.839 --> 0:05:24.919 and he heard it over this device what would what 0:05:25.000 --> 0:05:28.480 would become the telephone, And the message, of course was 0:05:28.640 --> 0:05:31.719 Mr Watson, come here, I want you. And it turns 0:05:31.720 --> 0:05:34.720 out that uh, corey to the story, Alexander Graham Bell 0:05:34.760 --> 0:05:37.520 had accidentally spilled some acid and needed Thomas Watson to 0:05:37.560 --> 0:05:39.640 come over and help him clean it up before it 0:05:39.680 --> 0:05:45.080 did any damage to the surroundings. So not only was 0:05:45.160 --> 0:05:48.120 March tenth, eighteen seventy six the first phone call, it 0:05:48.200 --> 0:05:53.919 was the first emergency phone call. So, yeah, that's a 0:05:54.120 --> 0:05:57.120 fun little little side note about this, and we are 0:05:57.279 --> 0:06:00.520 leading up to the company, but we have to lay 0:06:00.560 --> 0:06:03.279 this groundwork. Yeah, and I find all of this pretty 0:06:03.279 --> 0:06:06.520 fascinating overall. So, so on October eighth of that year, 0:06:06.560 --> 0:06:09.600 eighteen seventy six, they had the first two way telephone 0:06:09.600 --> 0:06:12.640 call between Watson and Bell. Now, before it was a 0:06:12.680 --> 0:06:16.039 one way thing. You could have a transmitter and receiver essentially. 0:06:16.040 --> 0:06:18.520 Now there was one on either side. You could actually 0:06:18.560 --> 0:06:21.960 have this communication. And this is where Bell introduced his 0:06:22.120 --> 0:06:26.839 idea of what the perfect telephone salutation was, Hoy hoy, hoy, 0:06:28.040 --> 0:06:29.840 which is what Mr Burns says when he picks up 0:06:29.839 --> 0:06:34.880 the phone on on The Simpsons. That's delightful. Yeah, Alexander 0:06:34.920 --> 0:06:38.400 Gham Bell and everyone involved in phone companies hated the 0:06:38.440 --> 0:06:41.279 word hello. They did, and we've got some notes about 0:06:41.360 --> 0:06:42.880 that in just a little bit. There was there was 0:06:42.920 --> 0:06:47.880 a very serious and an intense contention about this. It 0:06:47.960 --> 0:06:52.920 was important with a capital I. But so in eight 0:06:54.440 --> 0:06:57.360 Bell was getting financial backing from the fathers of two 0:06:57.360 --> 0:07:00.479 of his students at Boston University, Thomas Sanders and Um 0:07:00.600 --> 0:07:05.280 Gardner Hubbard, and wound up forming the Bell Telephone company right. 0:07:05.279 --> 0:07:07.760 In fact, that first he tried to sell the telephone 0:07:07.760 --> 0:07:10.760 patents to a rival company called Western Union. You may 0:07:10.800 --> 0:07:12.640 have heard of that company. At the time, it was 0:07:12.680 --> 0:07:15.760 the largest corporation in the world. And he offered to 0:07:15.800 --> 0:07:17.920 sell it to them for the princely sum of one 0:07:18.280 --> 0:07:20.320 d thousand dollars and Western Union told him to take 0:07:20.320 --> 0:07:22.679 a long walk off a short pier. Yeah, they didn't 0:07:22.720 --> 0:07:26.360 at that particular point in time understand what this whole 0:07:26.360 --> 0:07:28.160 telephone thing was about. They were like, that's a toy. 0:07:28.520 --> 0:07:30.840 We don't get it right. If you wanted to send 0:07:30.880 --> 0:07:33.240 a message to someone, why would you go through all 0:07:33.280 --> 0:07:36.120 this bother when you could just telegraph it to them. 0:07:36.200 --> 0:07:39.200 We've got perfectly good telegraph lines and swimming horses, why 0:07:39.680 --> 0:07:43.880 exactly so, So they they poo pooed the idea, and 0:07:43.920 --> 0:07:46.400 that's when Bell decided to go the other route and 0:07:46.440 --> 0:07:49.480 form this company. And with that financial backing that Lauren 0:07:49.520 --> 0:07:54.320 talked about, the Bell Telephone Company came into being um 0:07:54.360 --> 0:07:58.040 and Uh. At first, it was a pretty modest affair 0:07:58.680 --> 0:08:01.840 in the early days. They were seven seventy eight telephones 0:08:01.840 --> 0:08:05.520 in existence period, and the company had a grand total 0:08:05.600 --> 0:08:09.200 of one employee, and that one employee was Thomas Watson, 0:08:09.280 --> 0:08:12.920 the former assistant to Alexander Graham Bell, and he was 0:08:13.440 --> 0:08:16.360 He was paid the salary of three dollars per day 0:08:16.520 --> 0:08:19.400 and also had one tenth interest in the company, which, 0:08:19.440 --> 0:08:21.280 as it turns out, would probably be worth a little 0:08:21.320 --> 0:08:26.240 bit more than his salary. Yeah. So Bell goes ahead 0:08:26.320 --> 0:08:30.200 with his company. Uh. Meanwhile, Gray, who had done some 0:08:30.240 --> 0:08:33.040 work for Western Union and had founded a company called 0:08:33.080 --> 0:08:37.400 Western Electric that was acquired by Western Union, began to 0:08:38.200 --> 0:08:42.760 compete against Bell, and uh it got pretty nasty. Bell 0:08:42.960 --> 0:08:46.000 started to look into how he wanted to well, really 0:08:46.000 --> 0:08:47.960 the company was looking into how they wanted to form 0:08:48.000 --> 0:08:51.360 the business, and they took a que off the Morse 0:08:51.480 --> 0:08:54.720 Company Telegraph Company and went with a franchise model. The 0:08:54.760 --> 0:08:59.920 idea being that they would they would license out technology 0:09:00.040 --> 0:09:02.680 and telephones and things of that nature to companies that 0:09:02.760 --> 0:09:08.240 wanted to oversee the administrative efforts of handling this kind 0:09:08.280 --> 0:09:12.760 of local, regionalized phone system. And so Bell would end 0:09:12.800 --> 0:09:16.000 up getting a company. Bell would end up getting a 0:09:16.800 --> 0:09:20.480 portion of that revenue, uh, in return for the fact 0:09:20.480 --> 0:09:23.960 that they're licensing the technology to this other company. All right, right, 0:09:23.960 --> 0:09:26.920 Because until Bell's patents would expire, the company was the 0:09:26.960 --> 0:09:31.000 exclusive manufacturer and provider of telephones. Um those those patents 0:09:31.000 --> 0:09:35.320 would expire in and that was a date that everyone 0:09:35.559 --> 0:09:38.960 in Bell was very, very anxious about. They were cognizant 0:09:39.000 --> 0:09:41.360 of it, they were anxious about it. There were other 0:09:41.440 --> 0:09:46.560 companies that did attempt to spring up despite this um 0:09:46.600 --> 0:09:51.760 this legal monopoly that the Bell system had because of 0:09:51.800 --> 0:09:54.440 the patents. Uh. But we'll talk about that in a 0:09:54.480 --> 0:09:57.040 second before we get too far into this, because there's 0:09:57.080 --> 0:09:59.800 a lot to talk about. Let's take a quick break 0:09:59.840 --> 0:10:04.280 to thank our sponsor. You've probably tried Hulu dot com. Now. 0:10:04.320 --> 0:10:07.679 With Hulu Plus, you can watch your favorite shows anytime, anywhere. 0:10:07.920 --> 0:10:10.240 Hulu Plus lets you watch thousands of hit TV shows 0:10:10.240 --> 0:10:12.600 in a selection of acclaimed movies on your television or 0:10:12.640 --> 0:10:14.920 on the go with your smartphone or tablet, and it 0:10:14.960 --> 0:10:17.840 all streams an HD for the best viewing experience. With 0:10:17.880 --> 0:10:20.319 Hulu Plus, you can watch your favorite current TV shows 0:10:20.360 --> 0:10:23.320 like Saturday Night Live, Community and Family Guy, and you 0:10:23.360 --> 0:10:26.960 can also check out exclusive content, including Hulu originals like 0:10:27.000 --> 0:10:31.000 The Awesome starring snl Seth Myers and Moon Boys starring 0:10:31.040 --> 0:10:34.320 Chris o'dwald from Bridesmaids. Hulu Plus also offers a great 0:10:34.320 --> 0:10:37.720 selection of acclaimed films for only seven dollars and cents 0:10:37.760 --> 0:10:39.800 a month. You can stream as many TV shows and 0:10:39.840 --> 0:10:42.440 movies as you want wherever you want. Right now, you 0:10:42.480 --> 0:10:45.240 can try Hulu Plus for free for two weeks when 0:10:45.320 --> 0:10:47.959 you go to Hulu plus dot com forward slash Tech. 0:10:48.320 --> 0:10:50.760 That's a special offer for our listeners. Make sure you 0:10:50.840 --> 0:10:53.440 use Hulu plus dot com forward slash tech so you 0:10:53.480 --> 0:10:55.960 get the extended free trial and they know that we 0:10:56.040 --> 0:10:59.880 sent you. Go to Hulu plus dot com forward slash Tech. Now. So, 0:11:00.000 --> 0:11:02.360 there are a ton of TV shows and movies that 0:11:02.440 --> 0:11:05.040 you can see on Hulu Plus. One of them is 0:11:05.160 --> 0:11:08.480 Bob's Burgers, which is a favorite of mine. I really 0:11:08.559 --> 0:11:11.079 enjoy the show. H John Benjamin plays the lead role 0:11:11.200 --> 0:11:14.720 of Bob, and uh, it's it's certainly one of those 0:11:14.800 --> 0:11:20.640 dysfunctional family shows with lots of absurd characters and events. Uh, 0:11:20.240 --> 0:11:23.880 you just gotta go see it. So go check that out. Okay, 0:11:23.960 --> 0:11:28.480 So we're now up to eighteen seventy eight. Now. In 0:11:28.559 --> 0:11:32.000 eight seventy eight, that's when we saw the first regional 0:11:32.040 --> 0:11:35.760 telephone company actually launched. Not this was one operated by 0:11:36.000 --> 0:11:39.240 Bell Telephone. Right. It was a franchise called New Haven 0:11:39.280 --> 0:11:43.000 District Telephone Company and UH in New Haven, Connecticut, and 0:11:43.320 --> 0:11:46.720 Bell and Western Union began to compete even more viciously. 0:11:46.760 --> 0:11:49.320 They were both launching franchises across the United States. Western 0:11:49.400 --> 0:11:52.280 Union began to use leverage by saying that they would 0:11:52.280 --> 0:11:55.640 not install any telegraph lines in any locations that were 0:11:55.679 --> 0:11:58.960 using Bell Systems. So any region that relied heavily upon 0:11:59.000 --> 0:12:03.000 telegraph services wouldn't do business with Bell because they were 0:12:03.040 --> 0:12:05.840 afraid that they did. They would never have any improvements 0:12:05.880 --> 0:12:08.400 or repair or maintenance of the telegraph systems or even 0:12:08.440 --> 0:12:11.679 operation of the telegraph system. So it's kind of you know, 0:12:11.720 --> 0:12:15.280 holding Bell Systems hostage thing, you don't you know, if 0:12:15.280 --> 0:12:17.679 you don't uh, you don't get to play in this 0:12:17.720 --> 0:12:21.640 game because I own this game. Um. Now. Western Union's 0:12:21.640 --> 0:12:24.880 telephones were based on the work of two inventors, one 0:12:24.920 --> 0:12:28.760 of them Elisha Gray and the other Thomas Edison. Yeah, 0:12:28.880 --> 0:12:34.120 so some big names here. And on September twelve, that's 0:12:34.160 --> 0:12:37.920 when Bell Telephone Company sued Western Union, which is a 0:12:37.920 --> 0:12:44.240 big story because Bell had a small fortune at his disposal. 0:12:44.520 --> 0:12:47.560 Western Union was the largest corporation in the world at 0:12:47.559 --> 0:12:49.959 that time. It worth more than forty one million dollars 0:12:50.000 --> 0:12:53.080 and had the backing of a certain powerful family in 0:12:53.080 --> 0:12:56.120 the United States, the Vanderbilts. And so it was a 0:12:56.160 --> 0:12:59.840 big deal that Bell would go up against this corporate giant. 0:13:00.280 --> 0:13:04.920 And that same year Gardner Hubbard, one of those financiers 0:13:05.040 --> 0:13:07.920 who backed the Bell system in the very early days, 0:13:08.440 --> 0:13:12.240 hired on a man named Theodore Newton Vale to act 0:13:12.320 --> 0:13:16.800 as general manager slash president of Bell Telephone. Right. Veil 0:13:16.920 --> 0:13:19.880 had previously worked for the US Postal Service and and 0:13:20.000 --> 0:13:23.520 he was very key in orchestrating this legal battle. Yeah, 0:13:23.520 --> 0:13:27.560 it's also interesting because Veil will play another important role 0:13:27.640 --> 0:13:29.760 a bit further down the line. Veil had kind of 0:13:29.960 --> 0:13:34.000 on again off again relationship with Bell Telephone. Not necessarily 0:13:34.080 --> 0:13:36.320 all by choice, no, no, but but he did help 0:13:36.360 --> 0:13:39.839 shape the company and absolutely and even as early as 0:13:39.920 --> 0:13:42.680 this he had this vision of building a national long 0:13:42.720 --> 0:13:46.600 distance telephone network UM and doing it before Bell's patents 0:13:46.679 --> 0:13:51.240 ran out, so which was hugely ambitious, incredibly ambitious, a 0:13:51.280 --> 0:13:53.640 little too ambitious, it may turn out to be. In 0:13:53.760 --> 0:13:57.880 eighteen eighty, Alexander Graham Bell decided to resign from the 0:13:57.880 --> 0:14:02.200 Bell Telephone Board of Directors UM, and the next year one, 0:14:02.520 --> 0:14:06.000 Thomas Watson would also resign. So at this point the 0:14:06.000 --> 0:14:09.480 two inventors who gave the company the very basic invention 0:14:09.520 --> 0:14:12.880 that it was all centered around had left the board 0:14:12.880 --> 0:14:15.880 of directors at that time, I believe was putting a 0:14:15.880 --> 0:14:19.760 lot of pressure on. They didn't really see the immediate 0:14:20.120 --> 0:14:24.920 monetary purpose of this whole nationwide network thing, and so 0:14:25.080 --> 0:14:28.800 they were they were really getting down people's throats about like, 0:14:29.120 --> 0:14:30.480 we kind of want to make money, we kind of 0:14:30.480 --> 0:14:32.360 put some money in, we kind of want a little 0:14:32.360 --> 0:14:35.320 bit back, and this digging your heels in. Yeah, this 0:14:35.440 --> 0:14:37.120 is a whole lot of us giving you money and 0:14:37.160 --> 0:14:39.240 not a whole lot of us getting anything back. Right. Yeah, 0:14:39.280 --> 0:14:41.920 there were there were many years when this company was 0:14:42.040 --> 0:14:46.640 operating in debt because they were setting this stuff up. Also, 0:14:47.080 --> 0:14:51.280 interesting little side note, Thomas Watson had a second career 0:14:51.400 --> 0:14:55.800 after his work with Telephone Systems. He would begin a 0:14:55.840 --> 0:15:00.000 career as a ship builder. He built ships loood for him. Yeah, 0:15:00.040 --> 0:15:01.520 it's kind of interesting. I just thought it was neat 0:15:02.120 --> 0:15:05.720 So eight two this is about when Western Union and 0:15:05.800 --> 0:15:11.120 Bell Systems settle this lawsuit that's this ongoing dispute that 0:15:11.200 --> 0:15:14.880 had been pretty much taking up all their time over 0:15:14.920 --> 0:15:18.880 the last couple of years, um because the patent infringement 0:15:18.960 --> 0:15:22.920 lawsuits were something that was just nasty on all parts. Well, 0:15:22.960 --> 0:15:25.760 in that settlement, Western Union ended up selling its telephone 0:15:25.800 --> 0:15:28.480 network to Bell, so that was a network that was 0:15:28.800 --> 0:15:33.400 what there was, Like, that's that's significant. So fifty five 0:15:33.440 --> 0:15:36.760 more cities go to Bell Systems. Bell in return promised 0:15:36.760 --> 0:15:41.320 Western Union of its telephone rental revenue. So Bell Telephone 0:15:41.320 --> 0:15:44.560 also acquired from Western Union the company Western Electric that 0:15:44.640 --> 0:15:47.320 was the one that was founded by Elishah Gray, and 0:15:47.360 --> 0:15:50.840 that became a T and T s manufacturing division. So 0:15:51.520 --> 0:15:54.840 here's just a little information about how the phone system 0:15:54.960 --> 0:15:57.360 used to work in the United States. It used to 0:15:57.400 --> 0:16:00.320 be that you would go to a store to get 0:16:00.320 --> 0:16:03.200 a phone, and you leased it. You didn't own that phone, 0:16:03.760 --> 0:16:07.120 so you actually that phone remained the property of the 0:16:07.160 --> 0:16:09.480 parent company, which at this time is Bell Systems and 0:16:09.560 --> 0:16:12.480 shortly will become a T and T. And so you 0:16:12.520 --> 0:16:16.320 would pay a leasing fee, and in turn, the company 0:16:16.320 --> 0:16:18.840 that you got it from was likely not directly a 0:16:18.960 --> 0:16:21.200 T and T. It was probably some regional office that 0:16:21.360 --> 0:16:25.960 also was leasing that same phone from a T and T. 0:16:26.200 --> 0:16:29.840 Certainly at this point it was Bell systems. But yeah, 0:16:29.840 --> 0:16:32.480 so Bell Systems leases out a phone to a regional office, 0:16:32.520 --> 0:16:34.920 the regional office leases the phone out to the customer, 0:16:35.160 --> 0:16:38.080 So you didn't you never actually owned that phone, which 0:16:38.120 --> 0:16:40.840 I think some people might find a little unusual today 0:16:40.880 --> 0:16:43.600 because they think, well, I bought this piece of electrical 0:16:43.640 --> 0:16:46.000 I mean, you turn off the service. Fine, I understand that, 0:16:46.040 --> 0:16:50.120 but that's my phone. Um yeah not back then, Nope, 0:16:50.160 --> 0:16:54.200 you were just renting it. Really, So Western Union gets 0:16:54.200 --> 0:16:57.560 out of the way. So Bell system effectively becomes a monopoly. 0:16:58.040 --> 0:17:02.000 And according to research, terms of telephone network, yeah, they're 0:17:02.000 --> 0:17:06.119 they're pretty much. There are other competing telephone networks, but 0:17:06.200 --> 0:17:09.119 they're all they're all technically illegal at this time because 0:17:09.119 --> 0:17:13.440 this is still exactly so. According to researcher John Brooks, 0:17:13.480 --> 0:17:17.720 Bell Telephone would have a level more than six hundred 0:17:17.800 --> 0:17:21.439 patent infringement lawsuits against other companies over the course of 0:17:21.440 --> 0:17:24.360 a decade, and they won every single one of them. 0:17:25.600 --> 0:17:27.760 Because anytime a company would come up, like there were 0:17:27.800 --> 0:17:31.280 companies that were trying to create telephone systems in rural 0:17:31.320 --> 0:17:35.040 areas that Bell just had not reach, and so they 0:17:35.080 --> 0:17:37.880 wanted to give people the benefit of this technology. Bell 0:17:38.000 --> 0:17:40.719 did not have either the ability or interest to go 0:17:40.800 --> 0:17:42.760 into that market. So they would go ahead and do 0:17:42.760 --> 0:17:44.560 it themselves, and then Bell would soothe them because they're 0:17:44.800 --> 0:17:47.680 you can't do that. We have the the exclusivity rights 0:17:47.720 --> 0:17:51.159 to this technology, um and you know, and there's like, 0:17:51.200 --> 0:17:53.560 we're gonna get there and just give us time. Meanwhile, 0:17:53.560 --> 0:17:56.040 everyone's like, but I wanted to call my buddy. There's 0:17:56.080 --> 0:17:59.280 no nothing to call them on other than sticking ahead 0:17:59.280 --> 0:18:02.080 out the window and shot, hey, Jeb, so I don't 0:18:02.080 --> 0:18:07.520 know why his name is Jeb short Jebediah. Five. That 0:18:07.600 --> 0:18:09.520 is when a T and T is officially formed as 0:18:09.560 --> 0:18:13.560 a subsidiary of Bell. Yeah, and this is the the 0:18:13.600 --> 0:18:19.160 formal implementation of VAL's vision of creating a long distance network. 0:18:19.280 --> 0:18:22.120 That's the main purpose of a T and T. So 0:18:22.200 --> 0:18:25.439 a T and T is all about building out a 0:18:25.440 --> 0:18:28.160 long distance network so that people can call each other 0:18:28.280 --> 0:18:32.600 across states and across countries. Right by the end of 0:18:32.800 --> 0:18:36.320 eighty five, the company would establish the very first long 0:18:36.320 --> 0:18:39.680 distance connection between New York and Philadelphia. It was capable 0:18:39.720 --> 0:18:42.720 of hand handling a huge one call at a time, 0:18:43.160 --> 0:18:46.600 one call capacity. So I can just imagine the circuits 0:18:46.600 --> 0:18:48.720 being busy over and over and thinking they need to 0:18:48.800 --> 0:18:53.120 just wrap this up. Those people in Philly are chatter boxes. 0:18:53.760 --> 0:18:55.719 Uh yeah, So that was but it was really more 0:18:55.760 --> 0:18:58.000 of a proof of concept obviously at that point, not 0:18:58.119 --> 0:19:00.080 necessarily something that was going to be terribly proud. Go 0:19:00.200 --> 0:19:02.480 we're talking a little bit about how expensive these phone 0:19:02.480 --> 0:19:06.920 calls were too, got a little little dear. Um. So 0:19:08.200 --> 0:19:11.520 that same year was when the state of Indiana passed 0:19:11.560 --> 0:19:15.040 a law restricting the price of telephone rental fees. So 0:19:15.200 --> 0:19:18.240 remember I was saying, you rent your telephone, both the 0:19:18.320 --> 0:19:20.560 regional offices do it and then the customers do it. 0:19:20.920 --> 0:19:24.440 But because Bell was the only game in town, they 0:19:24.440 --> 0:19:27.359 could pretty much dictate what those rental prices were gonna be. 0:19:28.119 --> 0:19:31.119 Uh this this lawsuit said well you need to cut 0:19:31.160 --> 0:19:35.480 back on those costs. So um Bell's response, the company's 0:19:35.520 --> 0:19:38.080 response was saying, well, you know, we have to have 0:19:38.240 --> 0:19:42.560 these prices because the service is expensive to to build out, 0:19:42.600 --> 0:19:47.320 to administer, to maintain. We cannot operate at a lower cost. 0:19:47.800 --> 0:19:50.560 We if we were to lower these this amount of money, 0:19:51.000 --> 0:19:53.240 we would not make a profit, we would lose money 0:19:53.240 --> 0:19:55.560 on the deal. We can't do it. So your phones 0:19:55.560 --> 0:19:59.359 are off, and they shut off the phones in Indiana. Yeah, 0:19:59.560 --> 0:20:04.560 no more calls. Yeah, sorry, and um, it would be 0:20:04.600 --> 0:20:09.520 a couple of years before they would come when service 0:20:09.560 --> 0:20:14.560 was restored for one corporation to have. Yeah. Some people 0:20:14.680 --> 0:20:16.760 said the A. T and T statement was that this 0:20:16.840 --> 0:20:19.800 was an example of quote the futility of public action 0:20:19.880 --> 0:20:23.000 and ignorance end quote, saying that you know, you guys 0:20:23.000 --> 0:20:24.919 were all upset and you told us that we had 0:20:24.960 --> 0:20:27.000 to do this thing, but you didn't understand that we 0:20:27.000 --> 0:20:29.800 were doing it because that's financially what we have to do. 0:20:30.359 --> 0:20:32.359 Other people said, no, A. T and T held the 0:20:32.400 --> 0:20:35.520 state hostage by saying you don't get phone calls until 0:20:35.560 --> 0:20:40.920 you play ball, which that's that's that's pretty awful. Yeah. Yeah, 0:20:40.960 --> 0:20:44.840 well with without actually looking at the financial books and 0:20:44.920 --> 0:20:47.240 knowing that the company did operate in debt for a while, 0:20:48.800 --> 0:20:50.560 it's hard to say, although you know at the time 0:20:50.600 --> 0:20:53.440 they were positing themselves as sort of a public service, 0:20:54.320 --> 0:20:56.840 that's right, akin to something like the post office, which 0:20:56.840 --> 0:21:01.080 would become much more their their message in a few years. 0:21:01.200 --> 0:21:05.560 So seven that was the first year that Theodore Vale 0:21:05.560 --> 0:21:09.480 resigned as president. Yep, that that was directly I think 0:21:09.560 --> 0:21:13.120 in due to his frustration with the board was saying earlier. 0:21:13.200 --> 0:21:16.360 And there was a dispute with some Boston financial backers 0:21:16.400 --> 0:21:19.359 as well, and all of that kind of fed into 0:21:19.480 --> 0:21:23.320 VAL's resignation. He just decided that that was not where 0:21:23.320 --> 0:21:27.320 he needed to be. So, uh that he leaves. Don't worry, 0:21:27.320 --> 0:21:31.000 He's part of the story is not over yet without him. Meanwhile, 0:21:31.040 --> 0:21:34.679 in eighteen eighty nine, the Bell system would adopt the 0:21:34.680 --> 0:21:39.760 first official Bell logo. Yeah what it looked like a bell? Yeah, okay, 0:21:39.960 --> 0:21:43.720 that makes sense alright. That was when the first long 0:21:43.760 --> 0:21:46.679 distance connection was established between New York and Chicago. And 0:21:46.720 --> 0:21:49.480 this was the real display of long distance. You know, 0:21:49.520 --> 0:21:52.800 New York to Philadelphia was impressive. New York to Chicago 0:21:52.840 --> 0:21:57.800 was a much greater distance. So this was marked by 0:21:57.840 --> 0:22:00.600 a ceremonial phone call. Grand Bell would make that one 0:22:00.600 --> 0:22:03.199 as well. Yep, Alexander Graham Bell's on the call. Uh, 0:22:03.440 --> 0:22:06.119 I did not see who he was calling. Maybe it 0:22:06.160 --> 0:22:07.960 was just you know, prank calls. And he was making 0:22:07.960 --> 0:22:10.080 prank calls to Chicago and ordering pizza and then saying 0:22:10.080 --> 0:22:12.200 our pizza is better than your pizza. I can only hope, 0:22:12.400 --> 0:22:14.840 I would really hope. So, I mean you think prank 0:22:14.880 --> 0:22:18.360 called pizza? It fits. So the after all, the very 0:22:18.359 --> 0:22:20.120 first call on a mobile phone was a prank call. 0:22:20.520 --> 0:22:23.679 But the capacity of this line was just like the 0:22:23.680 --> 0:22:27.359 one from Philadelphia, one at a time, and it cost 0:22:27.520 --> 0:22:30.320 nine dollars for the first five minutes, which you you 0:22:30.359 --> 0:22:33.000 did the math on us inflation, Yeah, I used in 0:22:33.320 --> 0:22:36.840 the inflation calculator. Now, normally I would use the Bureau 0:22:36.880 --> 0:22:40.800 of Labor Statistics calculator, which factors in the consumer price index, 0:22:41.200 --> 0:22:44.439 but that only goes back to so I used the 0:22:44.480 --> 0:22:48.320 inflation calculator. I honestly don't know where they pulled their 0:22:48.359 --> 0:22:52.160 their figures from. So, but based upon the inflation calculator, 0:22:52.280 --> 0:22:56.160