Bell system In the early
history of the telephone up until the early 20th century, telephone service was fragmented. The ability to make a telephone call depended on not just on both parties having telephones, but that their telephone companies used the same standards and that there was a physical interconnect of their networks. The term "universal service" originated with
Theodore Newton Vail, president of
American Telephone & Telegraph (the original AT&T) and head of the
Bell System, in 1907 with the corporate
slogan "One Policy, One System, Universal Service". It was intended as a contrast to the "dual service" that had become common since the original Bell telephone patents expired in 1894, where
independent telephone companies operated not only in non-Bell System markets, but also as a competitor in Bell markets. These independent phone companies did not interconnect to the Bell System; though modern commentators
Willis Graham Act of 1921 The
Willis Graham Act of 1921 was called into action in order to resolve pressing issues in the debate about the merits of interconnectivity of telecommunication. The act marks the first piece of legislation in the history of telecommunication to tackle the increasingly difficult challenges of the telecommunication industry in the 20th century. Before the Graham act was passed the commonly expressed opinion was, such as by the Senate Commerce Committee, that telephone service fit the definition of a natural monopoly. The central practical problem, according to the committee, with the Willis Graham Act was competing telecommunication services serving one individual market. The act was in favor of a monopoly, which aimed to exempt competing telephone companies from the antitrust laws and allow them to unify the service by merging competing telecommunication service providers. The main principle behind the act was that there should be only one system in each community through which all users communicate. The focus was exclusively on local service rather than long-distance service, as no independent long-distance lines were able to compete with AT&T.
Communications Act of 1934 Universal service in telecommunications was eventually established as U.S. national policy by the preamble of the
Communications Act of 1934, whose preamble declared its purpose as “to make available, so far as possible, to all the people of the United States, a rapid, efficient, Nationwide, and world-wide wire and radio communication service with adequate facilities at reasonable charges”. The chief purpose of this law was to combine the
Federal Radio Commission with the ICC's wire communications powers, including regulation of AT&T, into a new
Federal Communications Commission with greater powers over both radio and wire communications. The language of the 1934 Communications Act was later re-interpreted to mean a commitment for telephone companies to provide service to all people, but historically this language was aimed at the more limited goal of unifying the United States' fragmentary telephone exchanges into a single universal system. To comply with the act, AT&T began increasing the price of long-distance service to pay for universal service. The act also established the FCC to oversee all non-governmental broadcasting, interstate communications, as well as international communication which originate or terminate in the United States. ==Providing service to all (1970s-present)==