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Promoting Monopoly

AT&T and the Politics of Public Relations, 1876-1941

by Karen Miller Russell (Author)
©2020 Textbook XX, 234 Pages

Summary

Since the invention of the telephone in 1876, publicity has been central to the growth of the industry. In its earliest years the Bell company enjoyed a patent monopoly, but after Alexander Graham Bell’s patents expired, it had to fight competitors, the public, and the U.S. government to maintain control of the telephone network. It used every means its executives could imagine, and that included constructing one of the earliest and most effective public relations programs of its time. This book analyzes the development of public relations at AT&T, starting with a previously forgotten publicist, William A. Hovey, and then including James D. Ellsworth and Arthur W. Page, who worked with other Bell executives to create a company where public relations permeated almost every aspect of work, leveraging employee programs, stock sales, and technological research for PR. Critics accused it of disseminating propaganda, but the desire to promote and protect the Bell monopoly propelled the creation of a corporate public relations program that also shaped the legal, political, media, and cultural landscape.

Table Of Contents

  • Cover
  • Title
  • Copyright
  • About the author
  • About the book
  • This eBook can be cited
  • Contents
  • Illustrations
  • Preface
  • Acknowledgements
  • 1 “A Necessary Adjunct to Nearly All Commercial Enterprises”
  • 2 “To Undertake Something in the Missionary Line”
  • 3 “A Largely Random Basis”
  • 4 “One Policy, One System, Universal Service”
  • 5 “We Are Really Governed by Publicity”
  • 6 “To Serve Well We Must Earn Well”
  • 7 “All Business in a Democratic Country … Exists by Public Approval”
  • Conclusion: “The Number One Public Relations Post in Industry”
  • Index
  • Series index

cover

Library of Congress Cataloging-in-Publication Data

About the author

Karen Miller Russell (Ph.D., University of Wisconsin-Madison) is Jim Kennedy Professor of New Media and Josiah Meigs Distinguished Teaching Professor at the University of Georgia. She is the author of The Voice of Business: Hill & Knowlton and Postwar Public Relations.

About the book

Since the invention of the telephone in 1876, publicity has been central to the growth of the industry. In its earliest years the Bell company enjoyed a patent monopoly, but after Alexander Graham Bell’s patents expired, it had to fight competitors, the public, and the U.S. government to maintain control of the telephone network. It used every means its executives could imagine, and that included constructing one of the earliest and most effective public relations programs of its time. This book analyzes the development of public relations at AT&T, starting with a previously forgotten publicist, William A. Hovey, and then including James D. Ellsworth and Arthur W. Page, who worked with other Bell executives to create a company where public relations permeated almost every aspect of work, leveraging employee programs, stock sales, and technological research for PR. Critics accused it of disseminating propaganda, but the desire to promote and protect the Bell monopoly propelled the creation of a corporate public relations program that also shaped the legal, political, media, and cultural landscape.

This eBook can be cited

This edition of the eBook can be cited. To enable this we have marked the start and end of a page. In cases where a word straddles a page break, the marker is placed inside the word at exactly the same position as in the physical book. This means that occasionally a word might be bifurcated by this marker.

←x | xi→

Preface

This book traces the history of public relations at American Telephone and Telegraph from its roots as a patent monopoly, through a period of intense competition, to a return to monopoly that made it the largest company in the world. Publicity began with exciting demonstrations of the telephone, which invigorated press coverage of the rapidly developing technology in the 1870s and 1880s. It continued with William Hovey, who experimented with dealing with the press in 1886 and with face-to-face communication with the public at the 1893 World’s Fair. In 1903 the company hired an external agency, the Publicity Bureau, and finally it formed an internal Information Department led by James Ellsworth starting in 1910 and by Arthur Page in 1927. As AT&T promoted monopoly, it also developed a publicity program that other companies envied, and then emulated.

But corporate publicity was never confined to one department at AT&T; public relations thinking occupied many executives and departments. Public relations could not be managed by one person or department partly because of the Bell System’s sheer size, but mostly because its entire existence hinged on public support for its status as a private, regulated monopoly. In fact, the programs were so numerous and massive that I have not attempted to document them all, mentioning only in passing, for instance, Western Electric’s farm and technical publication program or AT&T’s 1919 rate increase campaign. Instead I have focused ←xi | xii→on the development of corporate publicity and public relations necessitated by its continuous drive to garner public support and avoid, as much as possible, government interference in its business.

Critics have long recognized a connection between public relations and politics in the United States. Writing in the 1950s, the journalist Irwin Ross stated, “What PR is trying to sell, in an ultimate sense, are the merits of a particular corporation, and the merits of the American capitalist system.” More recently Robert E. Brown has argued, “PR is not political in part but thoroughly—structurally, historically, continuingly. Its very nature is political …”1 This analysis of Bell’s publicity from its founding through the Great Depression confirms that politics, and to a lesser extent the need to sell the service, drove the development of corporate public relations in the U.S. telephone industry. Promoting and then protecting its monopoly status influenced management decision-making and pushed executives to innovate public relations strategies and tactics.

Chapter Overview

To set the stage for understanding the development of the public relations function at AT&T, Chapter 1 reviews scholarship on publicity and press agentry before the turn of the twentieth century. Early histories of corporate public relations typically start around 1900, with the formation of the Publicity Bureau in Boston, and in 1904 with the founding of Parker & Lee in New York. More recently, however, scholars have developed a better understanding of early publicity efforts in other sectors, particularly politics and nonprofit organizations that, collected here, provide a better understanding of why and how public relations emerged in corporations.

Chapter 2 begins with an examination of the early history of the telephone in American history, including attempts by Bell Telephone’s founders to draw attention to their invention and company, and then introduces a previously unknown Bell publicist, William A. Hovey. The chapter shows how he began the company’s efforts to develop a media relations program, but also to communicate with stakeholders—employees and stockholders—directly, and how he urged a degree of transparency that would have served the company well in later years. Hovey traveled to cities where the press and public opinion were fervently anti-Bell, organized publicity opportunities such as the opening of the New York to Chicago line, a 940-mile technological marvel, in 1892, and helped to organize and run Bell’s exhibit at the 1893 World’s Fair. Underpinning these efforts was the ←xii | xiii→notion that Bell offered such good service that subscribers should remain with the company after Bell’s patent monopoly ended in 1893–94. But the publicity was sporadic and lacked a clear message, and when the patents expired, the company had no plan to counter the rapid rise of competition.

After the sudden death of Bell’s president in 1900, Hovey was no longer in a position to guide promotion, but the new president hired the Publicity Bureau around 1903, giving publicity a more formal and systematic place at AT&T. The Bureau’s primary contact with the company, James D. Ellsworth, quickly established a media relations program that included providing content, opening regional offices and sending representatives to hotspots, and paying for advertising that he hoped would influence both public opinion and newspaper editorial content. Again, however, this publicity was sporadic, coming mostly in reaction to problems at the local level, and it lacked a clear explanation for why Americans should put their trust in AT&T to run the telephone industry.

All of that changed when Theodore N. Vail became president of American Telephone in 1907 and hired Ellsworth to form an internal publicity arm the following year. Chapter 4 describes Ellsworth’s experimental use of advertising in western New York state, and Vail’s authorization of the development of a national advertising campaign organized around the slogan he coined, “One Policy, One System, Universal Service.” The company openly sought to return the telephone industry to its monopoly status, insisting that the best service could come only from a single, private corporation regulated by regional and national commissions to ensure that they operated in the public interest. Although independent competitors fought against monopoly in state legislatures and the press, and through organizations and the trade press, Ellsworth and other AT&T officials constructed and institutionalized a formal public relations function, innovating the use of educational advertising and film, to influence public perception of the industry as a natural monopoly that worked best in the hands of Bell executives.

By 1913 most Americans seemed convinced that a single telephone system was best – the apparent alternative was for businesses and individuals to subscribe to more than one – but another threat came to the fore: nationalization of the industry. As Chapter 5 reveals, AT&T and the Bell operating companies used every argument and medium they could conceive to fight this idea, but during World War I President Wilson nevertheless ordered a government takeover of the entire industry, although few outside the telephone industry seemed to care. However, the Post Office Department’s handling of the industry was so ineffective and unpopular that the government returned control to the companies after the war, thus ending any serious consideration of government ownership. Ellsworth ←xiii | xiv→turned to the institutionalization of the publicity function in AT&T and operating company publicity departments and throughout every level of the system. AT&T president Harry B. Thayer made operating company presidents accountable for public relations, encouraging them to support employees who joined local civic organizations, to work with the press and release as much information as possible, and to improve relationships with subscribers and shareholders. These strategies were premised on the “spirit of service” said to permeate Bell employees, who were the targets of an extensive welfare capitalism program meant to ensure their cooperation.

Details

Pages
XX, 234
Year
2020
ISBN (PDF)
9781433147357
ISBN (ePUB)
9781433147364
ISBN (MOBI)
9781433147371
ISBN (Hardcover)
9781433147333
ISBN (Softcover)
9781433147340
Language
English
Publication date
2020 (June)
Published
New York, Bern, Berlin, Bruxelles, Oxford, Wien, 2020. XX, 254 pp., 5 b/w ill.

Biographical notes

Karen Miller Russell (Author)

Karen Miller Russell (Ph.D., University of Wisconsin-Madison) is Jim Kennedy Professor of New Media and Josiah Meigs Distinguished Teaching Professor at the University of Georgia. She is the author of The Voice of Business: Hill & Knowlton and Postwar Public Relations.

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Title: Promoting Monopoly