The Development of the Telegraph and its Social Impact

There was also competition from the Bain chemical telegraph and the House printing telegraph. The House telegraph, for which a patent was granted in 1846, "instead of recording messages in the form of dots and dashes that had to be laboriously translated, printed the message directly upon a paper tape in Roman letters". Unlike the Morse telegraph, which mostly relied on electric current to do the work, the House telegraph relied largely on manual power, air, and a variety of springs and frictions to achieve its results. An experienced House telegraph operator could transmit between 1,800 and 2,600 words per hour, considerably faster than a Morse telegraph operator. What was the problem with the House telegraph? It was more complex and worked imperfectly on the wires of the day. In 1855, David Hughes invented a printing telegraph that significantly improved upon the House telegraph.

According to H. H. Goldin, in the decade following 1844, there; were hundreds of small telegraph lines thrown up, often haphazardly and under the various patents. Though there was a large demand for the telegraph, it was difficult to find investors because of skepticism on the economic feasibility of the technology, the fear that the government, as in England, would take over the industry, and partly because of conflicts between the patent holders and the potential investors over divvying up shares in the enterprise. The telegraph was frequently financed by the sale of subscriptions to ordinary individuals who lived in communities that would benefit from a telegraph.

One unintended consequence of the invention of the Morse code was that it stimulated a competing optical telegraph technology: the heliograph that was invented in 1865. The heliograph was a means of sending signals using reflected light. If you have ever seen a movie about naval battles during World War II, you have seen the heliograph in action. Though the use of reflected light was a means of signaling used by the ancients, it was the universal acceptance of the Morse code that stimulated the expansion of this technology.

Impact of telegraph on social interaction and culture

The telegraph had an enormous impact on culture. Prior to the telegraph, time in the United States was not standardized. Western Union, together with the federal government, was "responsible for applying telegraphic technology to time, standardizing it and disseminating it across the entire United States". The Time Service branch of Western Union was a cooperative effort of the United States Naval Observatories in Washington, D.C. and California. Today you can check the United States Naval Observatory Master Clock on the Internet. The standardization of time was a product of the telegraph. It is not necessary to say anything about how being tied to the clock has impacted our society.

Yet another impact of the telegraph was a consequence of both the wartime need for instantaneous communication and the simultaneous demand for male troops to fight battles. Thus, during the period of the Civil War, women entered the labor force as telegraphers. This is significant because at the time it was a highly skilled and relatively well-paid occupation. The transatlantic cable was established in 1866. For the first time, reliable instantaneous communication between North America and Europe became a reality. Many thought that the telegraph would help to promote world peace because of the ability to communicate instantaneously in a period of crisis.

The telegraph also impacted the social interaction of people. In 1912, at a time when its revenues were declining, Western Union introduced the special holiday blank telegram---a form decorated appropriately for the occasion (birthday, Christmas, New Years, and so on). In 1934, Western Union instituted a "flat rate" for standardized messages suitable for a wide range of occasions. With the advent of telegraphy, and especially the Western Union "social telegram," it became acceptable to send impersonal greetings to other persons on various occasions. The fact that the telegrams could be sent on a timely basis was significant. As can be seen in Figure 1, there was steady growth in the number of telegrams from 1867 through about 1893, when the telephone began to be used more.

The high costs of telegrams in the early years meant that the system would mostly be used by the sectors of the economy where the speed of communication was essential to the firm's profitability. Three industries were immediately and dramatically impacted by the telegraph: the financial sector, newspapers, and railroads.

The newspaper industry was one of the first to embrace the new technology, prompted by the outbreak of the Mexican War in 1846. By 1848, two news associations were formed in New York: the Harbor News Association, dedicated to foreign news, and the New York Press, for domestic news. Together with various regional news associations, by the 1850s, they were known collectively as the Associated Press.

The railroad companies also found great use for the telegraph in coordinating schedules and avoiding train wrecks. The telegraph led to a reorganization of operations. As Alfred Chandler observes, Daniel C. McCallum of the Erie Railroad paid close attention to improving the accuracy and regularity of information flows. Thus, the telegraph did more than just improve safety; it was "a device to assure more effective coordination and evaluation of the operating units" of the railroad. The telegraph made it possible to create a nationwide railroad system that was single tracked.

Conclusion

According to Field, the telegraph and the railroad did more than any two other inventions to bring finance into the modem world: the telegraph because of the speed of communication and the railroads because of the need for large amounts of financing. In the nineteenth century, there were between 200 and 300 stock exchanges, but only a few persisted after the spread of the telegraph. Investment bankers originated securities issues, but the secondary markets were crucial for liquidity of the securities. According to Field, the primary effect of the telegraph on secondary markets was to lower prices and increases the peak load supply of rapid execution and confirmation of transactions. In 1887, a telegram ordering a trade could be sent domestically, and confirmation of execution, could be received within one and a half minutes. In 1894, a similar transaction across the Atlantic could take less than four minutes, and by 1909 three minutes. By 1920, a trade between a San Francisco brokerage house and a correspondent firm in New York or Chicago could execute and confirm a transaction in as little as 56 seconds. The telegraph increased the real resources consumed by the brokerage industry, did little to attenuate the periodic volume booms, but did not reduce the volatility of share prices.

Bibliography

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