Breaking The Connection

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In 1876 Western Union decided against paying one hundred thousand dollars for all rights to the telephone.

No. 174,465: The Most Valuable Patent Ever Issued

The American Telephone and Telegraph Company was incorporated in 1885, but a series of companies and less formal business associations preceded its formation, and the company’s history begins with them.

The first of these associations, established by a written agreement dated February 27, 1875, was so informal that it did not have a name, though historians later came to call it the Bell Patent Association. The agreement provided that two Massachusetts men would each furnish half the money for a young fellow named Alexander Graham Bell to work on inventions related to telegraphy and that the three men would share any resulting patents.

Bell had been born in Edinburgh, Scotland, on March 3, 1847, the second of three sons of Alexander Melville Bell, a distinguished teacher of elocution at the University of Edinburgh. Melville Bell, said to have been the model for Henry Higgins in George Bernard Shaw’s play Pygmalion , was famous as a teacher and lecturer, as the author of textbooks that taught correct pronunciation, and as the inventor of a system called visible speech—a written code that indicated the exact positions of the throat, tongue, and lips during speech and that was useful in teaching the deaf.

After the deaths of Alexander’s brothers from tuberculosis in 1867 and 1870, concern for his only surviving son led Melville Bell to move his family to Canada, where they settled near Brantford, Ontario, in August 1870. In October 1872 Alexander opened his own school of “Vocal Physiology and Mechanics of Speech” in Boston, and the next year he was made professor of vocal physiology at Boston University. Meanwhile, he had begun experiments aimed at the invention of a “harmonic telegraph”—an invention that would have made possible the simultaneous transmission of multiple messages over a single wire and thus would have eliminated the largest problem associated with Samuel F. B. Morse’s telegraph, the fact that each wire could transmit only one message at a time.

Bell’s deaf students included George T. Sanders, the son of a well-to-do leatherand-hides merchant named Thomas Sanders, and Mabel Hubbard, the teenage daughter of a prominent Boston lawyer named Gardiner Greene Hubbard. Both men had capital to invest, and both were interested in Bell’s experiments. Their interest led to the signing of the Bell Patent Association agreement—the seed from which the biggest company on earth sprouted.

Bell conducted his experiments at the electrical shop of Charles Williams, Jr., in Boston, where he was assisted by a brilliant young machinist named Thomas A. Watson (no relation to Thomas J. Watson of IBM). One evening Bell told Watson his idea.

“I have never forgotten his exact words,” Watson recalled later. “‘If,’ he said, ‘I could make a current of electricity vary in intensity, precisely as the air varies in density during the production of a sound, I should be able to transmit speech telegraphically.’”

On June 2, 1875, while Bell and Watson worked on the harmonic telegraph, an accident in the sjiop proved Bell’s concept correct. The sound transmitted accidentally was the twang of a plucked reed, but as Watson wrote later, “The speaking telephone was born at that moment. Bell knew perfectly well that the mechanism that could transmit all the complex vibrations of one sound could do the same for any sound.” That fall Bell worked furiously on the application to patent his invention. He knew that in Chicago Elisha Gray, cofounder of the Western Electric Company (which later became the largest subsidiary of AT&T), was racing to develop his own telephone. On the morning of February 14, 1876, Gardiner Hubbard filed the patent application on Bell’s behalf at the Patent Office in Washington. A few hours later Elisha Gray filed a caveat —a warning to other inventors—staking his claim to the same invention. Those few hours made all the difference.

U.S. Patent No. 174,465, generally considered the most valuable patent ever issued, was granted to Bell on March 7, 1876, four days after his twenty-ninth birthday. Three days after that, on March 10, 1876, came the first transmission of an intelligible sentence via telephone. Preparing to test a new transmitter, Bell spilled a cup filled with acidic water onto his clothes and shouted in dismay, “Mr. Watson, come here, I want you!” Watson commented later, “Perhaps if Mr. Bell had realized that he was about to make a bit of history, he would have been prepared with a more sounding and interesting sentence.”

National Bell Is Born—and Wins Its Monopoly