A good auditor is not only skilled in the myriad ways of finding savings throughout the vast landscape of telecom bills, contracts, CSRs, etc.,  he (or she) inherently possesses a thorough grasp of the origins and history of the telecom industry itself.

“Telecommunications” refers to something vastly different than it did just a few decades ago.  As recent as the early 1970s, “telecom” primarily referred to anything (and everything) to do with the telephone.   AT&T was the primary player, and cell phones, fax machines, the Internet and email were still years away.

Our new series entitled “Telecom Networks 101″ covers some basic areas that all telecom auditors should know.   Designed for the “non-techie”, the series of articles are easy to read and will give you basic insight as to how the telecom network of 2010 evolved over the last 140 years.

Telecom Networks 101: Who Built the Network?

A “network” could be defined as, any system of things that are tied together. The network described here consists of wire and optic cable, equipment, satellites, antennae, and microwave equipment that tie your home or business to the rest of the world. Without this network the Internet, cell and ordinary phones would not work at all.

To answer the question of who built this network in the United States, some history of the Bell System is needed.

The Beginning: The Bell System

The Macmillan Dictionary for Students defines telecommunications as, “…communicating or sending messages over long distances by electronic means….” The word literally means, communicating across a distance. The industry is known as telecom for short.

In the 1870’s Alexander Graham Bell spilled acid in his lab and called to his assistant in another room, “Mr. Watson, come here. I want you”.  To his assistant’s surprise he heard the call through Bell’s first telephone device. Interesting that the first reported telephone message was a 911 call! Since that time, there has been an explosion of devices that transmit information “across a distance”.

The first telephone company was founded in 1877 just after Alexander Graham Bell obtained a patent for the telephone in the United States. It was called the Bell Telephone Company. Existing telegraph wire was in place from Samuel Morse’s telegraph network and was used for some of the first telephone transmissions.

Others across the country were stringing wire and offering service to people in those local areas. As demand grew for this invention, new alliances were made to join local networks to each other and the world. This expansion became the American Telephone and Telegraph Company.

AT&T for Short

The name was shortened to the familiar AT&T and the network they created is known as the Bell System. This company had help from subsidiaries such as Bell Labs—big brains that invented the transistor and carried on Alexander Graham Bell’s legacy—and Western Electric that made telephones and other electronic equipment for telecom.

Litigation Changes Everything

Government watchdogs were already in place to regulate telecommunications; the Federal Communications Commission (FCC) on the federal side, and the Public Service Commission (PSC) on the state side. They approved how much was charged for service, watched over every new innovation, and investigated any report of abuse. In fact, they still do.

In 1974, The MCI Communications Corporation filed a lawsuit against AT&T.   This was coupled with an antitrust suit filed by the Department of Justice for the purpose of breaking up the monopoly. That suit was won in 1980 which caused AT&T to divest itself of Western Electric and Bell Labs. Regional companies—known as RBOCS (Regional Bell Operating Companies)—were created such, as Southern Bell—my alma mater.

Before the divestiture of AT&T, it was the largest telecom company in America.  It made sense, in the beginning, to have one company to coordinate this massive network.  They gave you a phone along with your service and controlled the whole market; including the manufacture of telephones and telecom transmission equipment. When you disconnected your service the phone was returned to the company.

This divestiture started a storm of innovation and competition. Up to that point, AT&T—and a few small regional companies—built the network that spanned the U.S. and connected the rest of the world. Companies were bought, sold, combined and divested. Recently AT&T merged with some of its old holdings.   It is hard to keep track, if you are not paying close attention. Suffice it to say, a lot has transpired since the 1970’s.

Alexander Graham Bell – the father of the Bell System. He worked with the deaf and was trying to find solutions to that problem. Little did he know his invention would be responsible for communications to the world with the touch of a few buttons—and make the Internet possible. The Internet’s use of this network has created countless ways to speak, write and transmit information across a distance.

About the Author:

Saundra O’Neill began working for AT&T, and has spent the last fifteen years in utility design engineering for construction.  During this time her work in several fields of engineering (Civil, Structural and Telecom) established real world knowledge and experience in a wide variety of processes in the building industry with an emphasis on telecom Outside Plant and its processes.  Her experience and a desire to communicate/teach others, has expanded into technical writing - including software documentation and a variety of articles covering the telecommunications industry. Visit Sandy’s simple telecommunications blog.