Genius on Hold Page #4

that we needed this

regulated monopoly system,

and then they passed

the Willis-Graham Act in 1921,

which basically legitimized

telephone monopoly.

It said you're exempt

from the anti-trust laws.

Uh, it doesn't matter

if you're a monopoly,

we're not

going to prosecute you.

We, in fact, want you

to be a monopoly.

Once the phone system

is nationalized,

AT&T wastes no time in

applying for rate increases.

Within five and a half months,

long distance rates increase

by twenty percent.

AT&T makes over

fifty million dollars

in just seven months.

AT&T, American Telephone

and Telegraph,

was the parent company

of four different companies.

One was the Bell

operating companies

that would put in the lines

to everybody's homes

and businesses.

There was AT&T Long Lines,

who interconnected

those various exchange areas,

and then there was

Western Electric,

who manufactured the equipment

for AT&T,

and then Bell Labs,

who was the research

and development arm

for AT&T.

Bell telephone had a...

a-a-a tariff that said

you could not hook up

the Bell lines,

you can't find it

in the books anymore,

Bell lines without

their explicit permission.

And they were emphatic

about that.

If anyone uses

a telephone line in America,

it belongs to Bell.

Three decades later,

Walter Shaw,

while working at Bell Labs,

will challenge Bell's

universal process.

He has a secret.

When he returns home

each night,

he draws.

Not landscapes

or portraits,

he draws schematic diagrams

of inventions

he plans to build.

Later, he will go

to his office

with his home projects

under his arm

to impress his bosses.

And they are impressed.

Bell Labs was created

in 1925

to service

research and development

technology

for AT&T.

Bell will not only provide

communication services

to America,

but it will become

one of the leading innovators

in science, technology,

and military engineering

around the world.

Bell Labs provides

key personnel

in all areas

of communications science,

radar,

and weapons technology.

And they provide

the scientists and engineers

responsible, in part,

for the development

of the atomic bomb.

It would not be

an overstatement

to say that Bell Labs

became the darling

of the U.S.

Defense Department.

While at home working

on one of his drawings,

Walter Shaw invents

the first ever

voice-activated

speaker phone.

He doesn't show Bell

right away.

Instead, he actually builds

the prototype himself.

Meanwhile, Bell promotes Shaw

to the position

of senior engineer.

What Walter Shaw

will soon learn

is that the

U.S. Attorney General

under President Truman

has filed a lawsuit

against his employer

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