2.4 - THE TELEPHONE IN AMERICA 55 as a consumer good Their...

Info icon This preview shows pages 1–10. Sign up to view the full content.

View Full Document Right Arrow Icon
Image of page 1

Info icon This preview has intentionally blurred sections. Sign up to view the full version.

View Full Document Right Arrow Icon
Image of page 2
Image of page 3

Info icon This preview has intentionally blurred sections. Sign up to view the full version.

View Full Document Right Arrow Icon
Image of page 4
Image of page 5

Info icon This preview has intentionally blurred sections. Sign up to view the full version.

View Full Document Right Arrow Icon
Image of page 6
Image of page 7

Info icon This preview has intentionally blurred sections. Sign up to view the full version.

View Full Document Right Arrow Icon
Image of page 8
Image of page 9

Info icon This preview has intentionally blurred sections. Sign up to view the full version.

View Full Document Right Arrow Icon
Image of page 10
This is the end of the preview. Sign up to access the rest of the document.

Unformatted text preview: THE TELEPHONE IN AMERICA 55 as a consumer good. Their focus was largely on meeting publicly defined needs, such as responding to emergencies, and on keeping rates low. They struggled to raise capital for construction from general state revenues. Some European administrations restricted telephone expansion to protect their original missions of postal and telegraph service. Over the years, AT&T claimed that government monopolies in Eu— rope had not matched the success of private monopoly in the United States. A 1916 ad titled “Best and Cheapest Service in the World,” for example, contrasted American and European telephony on access, promptness, and price.49 Certainly, the diffusion of the telephone in the United States far exceeded that of Europe in the early years. In 1910 the United States had about eight telephones per 100 people, Canada three—and—a—half, the Scandinavian countries roughly three, and Ger— many and the United Kingdom under two. The reason for these dif— ferences, however, is less clear. Of course, the relative wealth of the nations clearly favored America. Also, the comparative advantage of the United States was greatest in rural areas, and it emerged most rapidly in the early 19003—both suggesting that competitive freeafor- all, not Bell’s private, largely urban, monopoly, created the American advantage. In the United States isolated farm families linked them— selves up by telephone, but in most European countries telephone administrations placed a single telephone or a handful of stations in village centers. In 1927 the United States had 15 telephones per 100 residents, Canada 13, Scandinavia about 8, Switzerland 5, Germany 4, and the United Kingdom 3, but again the advantage of the United States was considerably less in the large cities than in the small ones.50 Indeed, by 1927, 20 years after the heyday of competition and Vail’s decision to substitute consolidation for confrontation, the number of telephones in the United States was no greater than one would have expected given its wealth. While America’s 15 telephones per 100 peo— ple far exceeded that of European countries, so did its gross national product. The United States’ 93 telephones per $1000 of GNP was not exceptional. The Scandinavian nations, for example, exceeded 180 telephones per $1000 GNP, Germany had 141, and Switzerland had 118. Moreover, Americans’ household telephones were disproportion— ately likely to be on party rather than individual lines.51 North American and European telephony also differed greatly dur— ing the Depression. The United States and Canada lost ground in telephones per capita, while the European nations gained, sometimes THE TELEPHONE IN AMERICA 59 lice, and parking, and directly subsidizing automobile use by building improved roads, from streets to intercity highways.59 This difference did not escape people in the telephone industry. In 1928 Vice Presi- dent Page of AT&T noted that the automobile industry financed the campaigns for good roads and that “the money spent on good roads was the greatest subsidy an industry ever had. "60 Why this contrast developed is a large question that goes beyond the current study. Perhaps the concentration of telephone service in the hands of one company made it logical to keep its production costs, such as wire=stringing, internal, while the multiplicity of automobile producers made its costs, such as road maintenance, seem to be pub— lic goods. Perhaps the automobile posed so many social problems so early—accidents, fights over rights of way, and so forth—that govern— ment intervention appeared necessary. Perhaps the coalition of inter— ests around the automobile, from manufacturers to suburban home builders to farmers, was more politically powerful than any similar telephone coalition. Perhaps the costs of automobile infrastructure were so high that only government could handle them. In any case, the automobile was early and heavily subsidized by the general treasury. This situation contrasts, also, with the fate of the electric streetcar. Until the streetcar lines failed and were taken over by municipal gov— ernments, they and their passengers had to absorb almost all the costs of their infrastructure, even as they competed with the automobile.61 As for the telephone companies, they originally avoided govern— ment as long as they could. They would develop the telephone syse tem on their own. How they sought to do so, how they tried to sell telephony, is the subject of the next chapter. CHAPTER THREE DD CID Educating the Public The first step in understanding which Americans used the telephone and how is to observe how the sellers of the new technology tried to persuade Americans to use it. This chapter focuses on the evolution of the marketing of telephony. The marketing men (almost all sellers were men) were closest to the technology and its customers. Their livelihoods depended on developing its role in society. Their advertis— ing influenced people’s perceptions of the telephone. Finally, because salesmen were sensitive to consumer opinion, their discussions pro- vide an indirect View of the public’s reaction to the telephone. This View, however, has distortions. Business decisions do not per— fectly reflect market conditions. None of the great disasters of market- ing history, such as the Edsel and new formula Coca—Cola, would have happened if that were so. Nor would important innovations languish on shelves for years, as did, for example, the typewriter.1 Telephone men operated with their own habits, vanities, misinformation, and stereotypes. Yet where we find such distortions, we gain, through the back door, another glimpse of the public’s encounter with the tele— phone. Such misperception forms an important part of this chapter’s story. 60 EDUCATING THE PUBLIC 61 The evolution of telephone salesmanship, especially Bell’s, is evi— dent in the records of the industry. Marketing developed in response to internal changes such as new strategic thinking, to the evolution of the advertising profession, and to customer practices. Initially, Alexander Graham Bell and his associates devoted their efforts largely to devis— ing every possible means of bringing the telephone to the public’s attention. They often unveiled the device in flamboyant demonstrations, usu— ally involving the broadcast ofmusic and speeches from one place to an audience in another. It was appropriate to the late nineteenth century’s “theatre of science, ” as Christopher Armstrong and H. V. Nelles have called it. Some telephone stunts, though lacking the deadly thrills of automobile races and airplane derring—do, were dramatic. When an audience of bishops and priests in Quebec City in 1877 heard a voice singing, “Thou are so near and yet so far” they stood up and sang back into the box. In Hamilton, Ontario, that year exhibitors set up 15 telephones in the local WCTU hall for the public’s inspection, but a “disorderly mob of 400 burst into the Hall, tripped over the wires and broke the connections. One woman seized a phone, clapped it to her ear, heard nothing, and stalked out shouting, ‘Humbug. ”’ For decades, telephone publicists contrived demonstrations to promote various ser— vices, such as long—distance. In 1907 Pacific Telephone and Telegraph (PT&T) arranged to have the California—Stanford “Big Game” play— by—play reports called into Palo Alto; in 1916 it helped Stanford Uni— versity’s President Lyman address from California an alumni gather— ing in New York City; and that same year PT&T made it possible for Mrs. Roy Pike of San Francisco to stage a smashing dinner party: Her husband spoke from New York cross-country to her guests, each of whom had a telephone beside his or her dinner plate. In the same spirit, AT&T welcomed William Randolph Hearst’s offer in 1915 to show himselfin a newsreel using the telephone to call New York from San Simeon.2 In the earliest years telephone men had to introduce the telephone and demonstrate its utility face—to—face. Chicago executive Angus I-Iib- bard recalled, “In the first place, we had to go into a city or town and tell its inhabitants what the telephone was.” This included convincing non—English-speakers that the instrument “spoke” their languages. The wonder of it lasted for years, especially in remote communities. When PT&T opened an exchange in 1897 in Lodi, California, people 62. AMERICA CALLING came to the town drugstore from miles away to try it. One wrote in a letter: I can now state in all truthfulness that I have talked over a talkaphone. It was an interesting experience and made me realize more fully than ever that we are living in a wonderful age. Although I had seen a talkaphone before I never tried one before this morning. I could hear the voice very clearly although the speaker was a long distance from me. It was like a voice from another world. HereI was speaking to a person far away from me whom I could hear as though he was at my side and yet I could not see him.3 Once they had shown that the wonder really did work, the telephone men faced a still harder task: persuading people to pay for it. In the early twentieth century, AT&T both adopted more evocative sales messages that associated the telephone with practical ends such as saving time and initiated major public relations campaigns. By the late 19205, Bell moved to softer themes, most notably linking the tele— phone to sociability. Later in the century these themes would appear as the “Reach Out and Touch Someone” campaigns. The discussion of marketing begins with an overview of the tech— niques the industry used to publicize and sell telephone service. Then we examine several aspects of telephone marketing, in roughly the historical order they emerged: suggesting purposes for which people might find the telephone useful, instructing people on how to use the device, and nurturing goodwill toward the industry. In these ways, the industry men tried to shape the public’s understanding and use of the telephone. Next, we look in more detail at the industry’s attempts to manage customer use of the telephone for social conversation. We close with a comparative note on automobile marketing. PUBLICITY AND SALES TECHNIQUES [The Bell System] had to invent the business uses of the telephone and convince people that they were uses. It had no help along this line. As the uses were created it had to invent multiplied means of satisfying them. It built up the telephone habit in cities like New York and Chicago and then it had to cope satisfactorily with the business conditions it had created. It has from the start created the need of the telephone and then supplied it (Bell System Advertisement, 1909; italics in original).4 Many in the telephone industry believed, as this Bell advertisement declares, that they had invented the telephone’s uses. In 1909, the EDUCATING THE PUBLIC 63 same year as that ad, Theodore Vail told a New York legislative committee that telephone development had been slow at first “be— cause the public had to be educated; but as soon as the public was educated to the necessity and advantage of the telephone, then the growth became very fast indeed. . . . Today no man thinks of going into business or having a residence or anything else unless he has a telephone connection; but it took a long time to educate them [sit] up to that point.” Yet, two decades later, a Bell publicist expressed doubts about the effectiveness of this education. He attributed an up— surge in disconnections to “the fact that we have never thoroughly educated the public to the possibilities of the use of the telephone. . . .” He recommended telling “the new subscriber what to do with his tele— phone. . . and to make him ashamed to consider such a thing as ever again doing without it.”5 Both telephone publicists and advertising men emphasized the phrase “educating the public.” This generally entailed creating desires for a product but also included other persuasive activities, such as in— structing consumers on how to use the product and fostering goodwill toward the producer.* The sales techniques of the telephone industry, AT&T in particular, and the advertising industry evolved simulta- neously. , The earliest education tactics focused on free pub! icity, the creation of news about the telephone, through such events as the musical demon— strations staged by Alexander Graham Bell and Thomas Watson. As the industry grew, local managers handled their own publicity, often. through personal relations with newspaper men. In 1903, AT&T’S President Fish hired the Publicity Bureau of Boston, perhaps the country’s first public relations firm. Over the next few years, the Bureau reported having successfully placed scores of unattributed stories in newspapers: telephones on the farm, telephones in church life, a new switchboard at the Hotel Astor, financial problems of inde— pendent companies, the high cost of providing adequate service, the heroic work'of repair crews, and the like. Vail, however, preferred di— rect advertising and dispensed with the agency when he took over. By then, one the Bureau’s officers, D. Ellsworth, had joined AT&T and was continuing the publicity efforts in-house.6 Independent telephone *In an example from another industry, an official of the Colgate toothpaste com— pany credited its early advertising with “teaching the public the habit of caring for their teeth” (Strasser, Satisfaction Guaranteed, 95). 64 AMERICA CALLING companies also had gained much attention through comfortable ties with small—town editors in their service areas.7 The second major tactic used by the telephone industry to educate consumers was explicit advertising. Before Vail’s return in 1907, local companies inserted notices in the press that were often little more than announcements of service or listings of business subscribers. They also posted billboards, distributed flyers, and gave away promotional items such as blotters to advertise service or to comfort restless customers. Straightforward ads soliciting subscribers also appeared—such as a drawing of a Victorian woman in full bustle and regalia who was sav— ing time by phoning for her household’s needs—but they were un- common. (See Photos 7—9.) When Vail took over, he hired the leading advertising firm of N. W. Ayer & Son for Bell’s campaigns. Adver— tising of all kinds increased, but AT&T focused on using national ad— vertising, such as ads in popular magazines, to curry public support in political fights with the independents and with state and federal governments. The local Bell companies retained some discretion over their advertising, and budgets for newspaper ads varied considerably from town to town. Nevertheless, by the 19003, AT&T headquarters was advising the locals and providing them with sophisticated ad copy. In 1927, A. W. Page moved from editing the magazine World’s Work to heading publicity at AT&T, where he increased national advertising both for public relations and sales.8 Finally, telephone companies at times sold subscriptions door—to— door. In the nineteenth century, local entrepreneurs sometimes needed to twist arms. The first manager of the Eureka, California, exchange recalled that “my hardest work was getting my first twelve subscribers [the minimum for an exchange]. I called several times on Thomas F. Ricks who had a livery stable at the corner of 4th and F Street. He finally said he would sign to get rid of me.” Whenever demand for service exceeded the supply of lines and telephones, local companies laid off solicitors. In the late 19205, however, AT&T started a push for new subscribers and mobilized all employees, down to installers and operators, to sell service, even if only to friends and family. In- dependents had similar programs. The Depression accelerated these solicitation campaigns. Illinois Bell, for example, added over 100 new salesmen in 1931 and 1932 and encouraged its line workers to sell sub— scriptions both on their own time and while performing their jobs.9 Bell and others in the industry applied these three major tools of “education” —-publicity, advertising, and soliciting—to somewhat dif— ...
View Full Document

{[ snackBarMessage ]}

What students are saying

  • Left Quote Icon

    As a current student on this bumpy collegiate pathway, I stumbled upon Course Hero, where I can find study resources for nearly all my courses, get online help from tutors 24/7, and even share my old projects, papers, and lecture notes with other students.

    Student Picture

    Kiran Temple University Fox School of Business ‘17, Course Hero Intern

  • Left Quote Icon

    I cannot even describe how much Course Hero helped me this summer. It’s truly become something I can always rely on and help me. In the end, I was not only able to survive summer classes, but I was able to thrive thanks to Course Hero.

    Student Picture

    Dana University of Pennsylvania ‘17, Course Hero Intern

  • Left Quote Icon

    The ability to access any university’s resources through Course Hero proved invaluable in my case. I was behind on Tulane coursework and actually used UCLA’s materials to help me move forward and get everything together on time.

    Student Picture

    Jill Tulane University ‘16, Course Hero Intern