“The various companies in the West, South, and Northwest (forming groups of feeble organization) were gradually merged into one corporation, under the name of the Western Union Telegraph Company. In 1864, the United States Telegraph Company was organized to oppose this monopoly, and entered into a vigorous competition with the Western Union; prices were reduced in consequence, and the business increased with great rapidity. In 1866 the American Telegraph Company, the United States Telegraph Company, and the Western Union were united under the corporate name of the last corporation; the prices were again raised, and this first caused a less ratio of increase, and finally an actual decrease in the telegraphic business of the country.”
Mr. Hubbard’s pamphlet contains a statement of the rates between New York and Boston in former years which is inaccurate. The following is a correct table of the rates between those cities for the years 1849–52.
| In 1849 | the rate was | 30 cents. |
| In 1850 | the rate was | 20 cents. |
| In 1851 | the rate was | 20 cents. |
| In 1852 | the rate was | 10 cents. |
CORRECTION OF ERRONEOUS STATEMENTS.
The statement that “soon after the validity of the Morse patent was confirmed by the courts in 1852 many of the competing companies were enjoined and compelled to wind up or sell out” is incorrect, as is also the assertion that “the American Telegraph Company bought out most of the old companies, and continued to occupy their territory for many years without serious opposition.”
The validity of the Morse patent was never disputed. In 1849 the Morse patentees commenced suits against the New York and New England [Bain] Telegraph Company, and the New York and Boston [House printing] Telegraph Company, for an infringement of the Morse patent. The case against the company using the Bain patent never came to trial, while the other was decided in favor of the defendant, by Judge Woodbury of the United States Supreme Court, 1850.[[18]]
[18]. For an abstract of this decision see “Prescott’s History, Theory, and Practice of the Electric Telegraph.” Boston: Fields, Osgood, & Co.
The consolidations between competing lines, in 1852 and 1853, was caused by the inability of the companies under separate organizations to meet their working expenses. They were generally confined, however, to the union of the Morse and Bain lines, and there still remained two competing lines upon all the principal routes. There has never been but a single year, since 1849, when there have not been at least two competing lines between Boston and Washington.
The American Telegraph Company was not organized until 1855, and it was not consolidated with any opposition line until 1860. The next year after the consolidation the Independent Company built a competing line between New York and Portland, Maine.
The assertion that “the United States Telegraph Company was organized to oppose this monopoly, and entered into a vigorous competition with the Western Union, and that prices were reduced in consequence,” is also incorrect. The United States Telegraph Company never reduced the rates at any point. On the contrary, it was not until after the United States’ lines were put in operation that the rates were advanced. This was rendered necessary by the great depreciation of our currency, and consequent advance in the cost of labor and materials for working the lines, and was done by agreement of all the companies.