Bell System Competition: Private Telephone Networks ?

Edwards Finance > Phones

Q. It is often said that the old Bell System was a strict monopoly on telephone service. That wasn't 100% true. Many large organizations had their own internal telephone systems that were not Bell supplied -- those companies chose to lease/buy their systems from someone else rather than Bell. AFAIK, those systems were internal only and could not connect to the outside Bell network, but their internal network could be quite large.

A. Blurring the picture even further, there were big companies that had their own telephone systems, but using lines leased from Bell and connecting with the Bell public system. When I worked for G.E. circa 1967 there was such a system -- I don't remember now what the name of it was -- where we could dial a certain prefix and then dial most other G.E. locations without going through the public switched network. Big companies also had their own teletypewriter networks, usually with lines, equipment and maintenance furnished by Bell or W.U. on a lease basis. The airlines had these, and in addition the ability to exchange messages with other airlines. That was a big thing in the days of regulated air transportation when a trip from here to there often required flying on two or more airlines. I remember too that big department stores had their own internal telephone systems with equipment from independent telephone suppliers. Only a few employees were considered to need phones for both the internal and external phone networks. One company with plants on the Gulf Coast figured it could save a great deal of money by a private PBX, but chose to use Bell service because of the Bell System's ability to restore service after a hurricane. These adjacent plants were served by a 5-digit PBX and the company maintained its own radar installations from the Sabine River to Brownsville. This radar network was more extensive than the Weather Bureau's at the time and the telco often consulted with the company as to what it's radar showed when a hurricane was in the offing. Later this was recreated as a 'dial 8 [from most locations; one location stubbornly used 8 for local access and something else, 7? for tie line access]' and then a 7 digit number within the IBM internal network. I believe that later some of the traffic was moved to the PSTN, and later yet, the dial 8 system was replaced by smarter PBX/CENTREX systems that would route an external 1+10 digit number optimally including on a tie line if it still existed.

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