British dominance of early cable

From the 1850s until 1911, British submarine cable systems dominated the most important market, the North Atlantic Ocean. The British had both supply side and demand side advantages. In terms of supply, Britain had entrepreneurs willing to put forth enormous amounts of capital necessary to build, lay and maintain these cables. In terms of demand, Britain's vast colonial empire led to business for the cable companies from news agencies, trading and shipping companies, and the British government. Many of Britain’s colonies had significant populations of European settlers, making news about them of interest to the general public in the home country.

British officials believed that depending on telegraph lines that passed through non-British territory posed a security risk, as lines could be cut and messages could be interrupted during wartime. They sought the creation of a worldwide network within the empire, which became known as the All Red Line, and conversely prepared strategies to quickly interrupt enemy communications.

The submarine cables were an economic boon to trade companies because owners of ships could communicate with captains when they reached their destination on the other side of the ocean and even give directions as to where to go next to pick up more cargo based on reported pricing and supply information. The British government had obvious uses for the cables in maintaining administrative communications with governors throughout its empire as well as in engaging other nations diplomatically and communicating with its military units in wartime. Location of Britain’s territory was also an advantage as it possessed both Ireland and Newfoundland, making for the shortest route across the Atlantic Ocean (reducing cost significantly).

A few facts put this dominance of the industry in perspective. In 1896, there were thirty cable laying ships in the world and twenty-four of them were owned by British companies. In 1892, British companies owned and operated two-thirds of the world’s cables and by 1923 their share was still 42.7 percent. During World War I Britain's telegraph communications were almost completely uninterrupted, while it was able to quickly cut Germany's cables worldwide.

May 15, 2012

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