OBT – Ohio Bell Telephone
History of Ohio Bell Telephone Company
The Ohio Bell Telephone Company is a division of Ameritech Corporation and provides limited long-distance and local-exchange telephone communications in Ohio. Ohio Bell served approximately three-fifths Ohio’s residents in the mid-1990s and maintained over 3.4 million lines in Cleveland, the company’s headquarters. Ohio Bell also provided other communications services such as voice and data private lines, data transmission and radio and television broadcasts.
Alexander Graham Bell called his colleague in 1876 through a new communications device. One year later, Cleveland, Ohio installed its first phone. Western Union Telegraph Co. provided the first telephone service in the city, but the company soon resigned due to a patent dispute with Bell Telephone Company. This organization was formed to market and oversee Alexander Graham Bell’s technology. The Cleveland Telephone Company, a Bell-licensed company, purchased the exchange. The Cleveland Telephone Company was established in 1880 and operated in Cleveland for ten years as the only local phone company.
The city’s phone service grew quickly. By 1880, the city’s original customer base was 76. It had grown to nearly 300. Ten years later, that number had nearly ten-folded to 2,979 subscribers. The relative cost of phone service ($72 per year for businesses, $60 for homes) meant that the invention was primarily popularized by the wealthy and businesses.
Long distance service was established in Cleveland after local phone lines were installed. It reached Cleveland in 1883 through a Chicago-based Bell company. The American Telephone and Telegraph Company (AT&T), which was providing long distance service to Cleveland by 1893, marked the beginning of a relationship that would last almost 100 years.
Bell Telephone was the original founder of AT&T. It was its long-distance subsidiary. Bell Telephone’s growth was phenomenal and it realized that additional funds were needed to expand. The state of Massachusetts, where Bell Telephone was founded, limited the capital it could raise as well as the ways it could raise it. Bell Telephone’s AT&T subsidiary was formed in New York, where expansion rules were more permissive. It took over the local telephone exchanges and continued its role as long-distance provider. AT&T, which had more than $70 million in assets in 1899, became the parent company for the Bell System. The Cleveland Telephone Company was then a wholly owned subsidiary of AT&T.
Independent phone companies started to form after the Bell patents expired in 1894. The first competition for the Cleveland Telephone Company was the Cleveland Telephone Company. For example, the Cuyahoga Telephone company offered lower rates than Cleveland Telephone, and subscribers had access to places not accessible by the Bell system. Cleveland Telephone was forced to lower its rates due to the new competition. Customers of both companies soon found themselves frustrated by the inability to place calls to competitors. Businesses discovered that subscribing both companies’ services was necessary to communicate effectively with their customers. To solve this problem, both companies agreed to share services in 1901.
The true growth of Cleveland Telephone Company started in the early 1900s, with a name change as well as a series acquisitions. The Ohio Bell Telephone Company was established in 1921 by Cleveland Telephone. This identity lasted for more than 70 years. It also acquired the Central Union Telephone Company’s Ohio offices, along with the services in southern Ohio of the Chesapeake and Potomac Telephone Company (West Virginia) during this period. The merger with Ohio State Telephone, which was the largest independent phone company in the country, made Ohio Bell the leading communications company in Ohio. Ohio had approximately 875,000 phone lines, with Ohio Bell operating 505,000. The company was worth $100 million.
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