Erik Visits an American Grave, Part 2,215

This is the grave of Theodore Vail.

Born in 1845 in Malvern, Ohio, Vail grew up in Morristown, New Jersey. His family wanted him to go into medicine, but he was more interested in telegraphy. So as a teen, he moved to New York to get a job in a telegraph office. He was good at this and he rose quickly in that world. He got a job with United States Telegraph, which later became Western Union.

Now, the 1860s was still very much the era when Americans had ideas about the frontier and farming as the True Way. Any good American would want to homestead, right? I mean, no, that sounds horrible. But the number of people who were determined to make it on their own piece of land, freshly stolen from indigenous people, was really high, and not just the poor trying to make something happen for themselves. So in 1866, Vail’s father became one of these people, deciding to get some land in Wyoming and farm it. Farming in Wyoming–when could that fail? Well, young Vail went with him dad. Wanted the adventure. But of course homesteading was terrible. It didn’t take Vail long to figure out that getting a job back in the telegraph business made a lot more sense than clearing arid land. So he got a job as the telegraph man for the Union Pacific Railroad in Pine Bluffs, Wyoming. This was during the construction of the Transcontinental Railroad and Pine Bluffs was where the wood was.

Vail was good at this sort of thing and so the UP gave him a job when the rail was completed as the head of their mail services (a big part of the operation in these early years) between Omaha and Ogden, Utah. That was in 1869. That year, there was a huge snowfall. Vail managed to get people to get the snow cleared and keep the mail going. That got the attention of the big bosses. He rose quickly after that, moving over to working directly for the federal government in the early 1870s, at the office of the General Superintendent of Railway Mail Service. One of his jobs there was convincing Congress, always a bunch of penny pinching cheapskates when it came to funding even the most basic services to keep the nation running, to actually pay him for his job of keeping the mail going. He kept being promoted and in 1876, became the General Superintendent himself. The main thing he did was to promote postal employees as part of the nascent civil service. And really, that always made so much sense. Why does my mail carrier need to be of one or the other political party? And almost everyone agreed with this from the late 19th century until Donald Trump….

But like a lot of people at this time, Vail found himself attracted by private industry. Why wouldn’t you when they pay was vastly superior. The late 1870s saw the development of the telephone industry and since that built on the existing telegraph, Vail had expertise. Alexander Graham Bell invented the telephone but that was not the man you wanted organizing the industry. Bell’s father-in-law, Gardiner Hubbard, took over that part of the operation. He created American Bell Telephone, the first big phone company. Now, Hubbard and Vail had not always seen eye to eye, with the former opposing much of what the post office did, I think because he wanted to run that kind of thing himself. But that didn’t mean they couldn’t work together on this new and quite apparently revolutionary technology.

So Vail became general manager of the American Bell Telephone Company in 1878, basically what we would call today a chief operating officer. He was very active here. Patent defense was a huge part of leading this company–there was a lot of money on the line. Bell was pretty heavily undercapitalized and Western Union was not. So they battled over control of the industry. Western Union was engaging in massive patent infringement. Bell didn’t have the resources to fight back, so Vail opened the company to business investors that he knew. They staked those battles. He also led the move to use copper in telephone lines, which certainly did revolutionize the industry.

Then, in 1885 Bell merged with some other companies to form the American Telephone & Telegraph Corporation. Vail was the first president of AT&T. That company was basically the long-distance version of Bell and pretty soon, if you were in New York, you could call Chicago. Vail’s big thing here was monopoly (unsurprising for the era). He wanted AT&T to control everything, including the manufacturing of the line. He wanted no competition. Mostly, he succeeded.

Vail stepped away from AT&T in 1887. He was rich and wanted to travel. He spent a bunch of time in South America. He also wanted to invest there–a guy like this couldn’t really ever retire exactly. He always saw the business opportunities. He got the Argentine government to give him a concession to build a power station in order to operate an electric trolley in Buenos Aires. He then bought out all the horse-drawn carriages in the city to create a monopoly for himself. Dude was obsessed with creating monopolies.

But in the meantime, AT&T hit the skids. Service wasn’t great. Independent companies started competing and getting more customers. Vail was brought back to the board of directors in 1902, but that was mostly in an advisory role. But in 1907, he returned as president and he engaged in massive changes. He did a lot of public relations stuff, really at the start of this field. He prioritized customer service. He wanted employees to be fairly happy (though nonunion of course) and so engaged in some early programs to make them feel like they had a stake. By this time, J.P, Morgan owned a lot of AT&T stock. So Vail and Morgan started buying out the independents and reestablishing the beloved monopoly. They even bought up 30% of Western Union and brought their old rival under their control, or at least into a partnership of sorts.

Vail also believed that government regulation was good. He wanted telephones to be a monopoly and he wanted to head that monopoly, but he also considered it a public utility and believed it would be good business for the government to ensure that things were above board and thus have a reassured public. By the end of Vail’s life, in 1920, this was causing some tension as the government noted that AT&T was violating antitrust legislation.

Vail’s other late life project was in establishing Junior Achievement, the capitalist propaganda program targeted at kids. That started in 1919 and still exists today.

Theodore Vail is buried in Vail Memorial Cemetery, Parsippany, New Jersey.

If you would like this series to visit other people associated with AT&T, you can donate to cover the required expenses here. Alexander Graham Bell is in Baddeck, Nova Scotia. I could use a nice road trip to Canada, so you should make that happen. Gardiner Green Hubbard is in Washington, D.C. Previous posts in this series are archived here and here.