Omaha daily bee., 1909-12-05

lance business and eventually absorb all
Of the constituent operating companies by
taking over their franchises. This policy
has been carried out, only to the extent Of
taking over the Bell company I'm 1894. a
step which was due to the fact that the
attitude Of the Massachusetts legislature,
where the Bell company was incorporated,
did not allow IL TO increase its capital fast
enough to meet the growing needs OF the
business. The American Telephone and
Telegraph company, accordingly, in the
latter year mentioned, increased it's cap
ital stock and sold sufficient shares for
cash to purchase the stock OF the American
Bell Telephone company at $500 per share.
The nominal CAPITAL of the Bell concern
was then slightly under SO, OOO, 900 and it's
stock had been sold from time to time for
sufficient premiums to have realized for
the company In excess Of S27, OOO,O 900. In
other words the stock OF the American
Bell Telephone company represented more
cash paid in tina it's entire par value.
Through these years and in the years
that came after, the telephone combination
became more and more closely bound to-
gether by the extension Of the long dis
lance telephone business, AS fast as a
AN AeAo WI W8 AAA@1~H
being operated by the American Telephone
and Telegraph company. a new local tele-
phone company was added to the field Of
direct telephone communication. thereby
enhancing the value Of the service both to
the local company and to the companies
already within the long distance area.
Thus the development has been continuous
and new methods have developed as the
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group Of exchanges IN any particular field
had not been assisted and directed in the
Introduction and development Of the many
new ideas, methods and inventions, there
would have been now as many separate
systems and as many methods Of operating
as there were separate companies.
Control of Instruments.
Not only would this have resulted in
the isolation Of the various groups from
each other, and in the consequent degen-
Grafton OF the service. but II would have
made ii necessary for each group Of tele-
phone companies to go through by itself
all OF the experimental stages OF the me-
.chanical development of the telephone,
and to have made all Of the mistakes
that have been made in that process. As
1t is, the American Telephone and Tele-
graph company owns and maintains all
telephone instruments. 1t owns, either
directly or through the Western Electric
company, which 1t organized to handle
The manufacturing end Of its business,
all the patents.
Through this Capitalization il has been
possible TO apply the inventive genius and
the enormous capital at the Of
the dominating company to the needs Of
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A department was organized at the very
outset OF the long distance business and
has been continued ever since, which does
nothing but experiment with various pat
ents and inventions relating TO the tele-
phone and kindred subjects for the pur-
pose OF determining their value to the
telephone industry. The engineering de-
partment takes up all suggestions Of this
kind and passes upon them, 1t is also a
clearing house for all the troubles OF all
OF the subsidiary companies. II has under
continuous observation all traffic meth
DDS, and works out all problems involving
construction and present or future devel-
.0pmsnt cheme5.
The value OF this system is obvious and
through the patent and engineering de-
partments. coupled with the manufactuT-
ing department., where all equipment and
apparatus are built that are used through
out the Bell Telephone systems the coun-
try over. a uniformity u organization IS
afforded. the importance Of which IL is
thoroughly 10 appreciate. II
may be said that this unity OF 0rganiza-
uon is the thing which has largely differ
entiated the development Of the telephone
Industry from that Of many other indus
tries. where disorganized effort has been