"Do not whistle, sing or play musical instruments on the lines when they are in use; neither use sweet talk lest you soften the wire."--The Farmers' Mutual Telephone System of Shenandoah County telephone directory of 1929
For the romantics of Shenandoah County, the rules of the local telephone company fortunately have changed during the past 53 years.
For the business-minded, the often unreliable, bare-wire equipment also has been replaced to provide the most up-to-date, efficient service possible. Even the name of the telephone company has been altered to a shorter, crisper title--Shenandoah Telephone Co.
Despite these changes, Shenandoah's president, Warren B. French, says the good old-fashioned personalized service the company provided its customers 53 years ago remains.
"If you call information, you get personal service--and most likely more information than you would if you were a customer of a big company. That's because my girls know what's going on in the area; they know the Esso station on Rte. 81 is a wrecker station," French says.
What's more, he says, "if one of my customers has a problem, he knows where to find an answer quickly because he knows me--or of me--or one of my board of directors, or 78 employes."
This personalized service, French says, is one of the chief advantages of being a customer of a small telephone company.
Shenandoah Telephone, with 12,255 customers, is just one of the nation's 1,483 telephone companies whose operations are run almost completely independent of the Bell System.
Ranging from the large firms with millions of customers in several different states to small companies with no more than 100 customers in a 20-mile radius, these independents operate one of every five telephones in the United States. Although overshadowed by Bell System companies, their presence is pervasive throughout the United States, with independents operating in all but two states--Rhode Island and Delaware.
In Virginia alone, 21 independent companies offer telephone service, primarily in the rural areas, although Charlottesville is served by Central Telephone & Utilities Corp., the nation's fifth largest phone company.
A handful of Virginia's independents are as small as Burkes Garden Telephone Co. in Burkes Garden, Va., near the West Virginia border. "We've grown so big that we now have 100 stations telephones ," jokes the company's president, E. P. Greever. With no full-time employes--Greever himself has a full-time job as county treasurer--the company's billing and operators are provided by a larger independent telephone company nearby.
Service is not the most up-to-date, Greever admits. To make long-distance phone calls, Burkes Garden residents cannot dial directly; instead they must have an operator place a call. "Our service might be improved," Greever says, "but then we might have to pay more than the $7 a month we pay now" for basic service.
For the most part, however, the independents in Virginia are far larger and more efficient than Burkes Garden. Several, including Shenandoah, are even at the cutting edge of technology, installing digital switching equipment and fiber optic lines to carry telephone signals--often at a faster rate than the Bell System's Chesapeake & Potomac Co.
What's more, one company, Continental Telephone Corp., is about to test one of the newest and most promising telecommunications services this summer in Manassas when it launches a videotext experiment to allow consumers to shop by telephone and read newspapers and other reference material electronically.
One hundred homes will be selected by a marketing firm to test, free of charge, an information retrieval system that will include restaurant, museum and theater guides; national and local news; weather; sports; classified advertising; television listings; bus and airline schedules; shopping information; recipes, and business and financial news.
The one independent operating in Maryland--Armstrong Telephone Co.--also has installed digital switching equipment--"the most modern facility we can have in telephony," according to company president Jud Sedwick.
The modernization has come even though the company has not raised its monthly $6 local rate since 1963 and even though it serves less than 3,000 customers in the Rising Sun, Md., area. "We're just good operators," says Sedwick in explaining why his company has been able to prosper.
Yet, generally, local utility commissioners say the rates of independents are higher than those charged by C&P. For one thing, C&P and other Bell System companies usually serve the more populated areas, notes Edward C. Addison, director of the division of communications for the Virginia State Corporation Commission. "That means that C&P doesn't need such long cables" as the companies serving the rural areas, thereby reducing C&P's costs. Additionally, he says, the high density of customers means more people share the expense--as well as more business customers, who are generally "the most lucrative source of revenues."
Although independent phone service in the past has been inferior to the Bell System's, Addison says it is rapidly improving to the point where the independents are now "providing service of the same quality offered by C&P." And in some rural areas of Virginia served by C&P, independent telephone officials say telephone service is poorer than that offered by nearby independents because C&P has focused all of its resources in the big cities, which provide the bulk of its revenues.
Even so, Addison notes, consumer complaints against independents far outnumber those against C&P. According to the corporation commission, C&P has one of the lowest complaint records--0.16 complaints per 1,000 customers a year--while Continental has 1.98 per 1,000 customers a year.
Two years ago, the complaints got so bad that the corporation commission, in approving a $4.2 million rate hike for Continental, ordered $600,000 to be withheld pending an improvement in service.
The chief complaints from Continental customers dealt with transmission problems--calls weren't being completed or went to wrong numbers--with long delays in getting new service, with billing errors and with the rate structure, under which all calls between Prince William and Fairfax County are considered long-distance calls.
A large part of Continental's problems stem from the fact that it is serving one of the fastest growing areas in the state and therefore has been unable to keep up with demand, state officials acknowledge.
Another problem stems from the way in which Continental was created. What is now the nation's fourth largest telephone company was formed only 21 years ago when the company's chairman, Charles Wohlstetter, began buying up small independent firms whose officers were eager to leave the business. They wanted to sell either because there was no one in the generally family-owned businesses who wanted to carry on, or because the officers didn't want to spend large sums of money to upgrade the telephone system to keep it operating efficiently.
As a result, many of the 18 companies Continental acquired in Virginia needed modernization, which could not all be accomplished in a short period of time. In Virginia, the company has spent $40 million to $50 million a year for the past six years to modernize the network. The expenditures now appear to be leaving their mark. Prince William County Supervisor James McCoart, a frequent critic of Continental, now notes that "the problems seem to have dissipated. I have not got a complaint on phone service in quite a while."
But Continental officials concede that a large number of complaints will continue as long as its rate structure requires customers to pay long-distance rates for calls made to nearby residents in Northern Virginia.
Unlike Continental, most independent companies are decades old, set up at the turn of the century shortly after Alexander Graham Bell's patent on the telephone expired. Although Bell had tried to build a large nationwide network before his patent ran out, he had concentrated his efforts in the larger cities. As a result, many rural area residents set up their own systems. Some were set up as cooperatives in which every customer had to install his own line to his home. Once his line was hooked into the system, the customer became a shareholder of the mutual company. Other independent firms began as family businesses, with the switchboard often in the owner's kitchen or living room.
For a while, AT&T bought out the most profitable of these companies, especially those set up in big cities to compete with the Bell System. But, in 1912, just as support was growing in Washington to nationalize the telephone industry and just after avowed trust-buster Woodrow Wilson was elected president, AT&T promised the government to stop its acquisition of independent telephone companies, thereby guaranteeing the existence of the independent firms.
To Shenandoah's Warren French, the independence is, in many ways, a blessing.
"As a businessman you have the personal satisfaction of knowing you are furnishing good service to customers with a degree of control over what you do," he says.
Additionally, "you don't have to go through 10 different people and write a half dozen reports to solve unusual problems," he says, adding that problems are usually solved more quickly at independent firms.
Under a 1956 agreement with the government, AT&T is barred from selling its Western Electric equipment to independent companies. However, that restraint does not seem to bother French. "We might experience greater stability in technology by buying from Western Electric." But at the same time, he says, "I doubt that I would have the same type of personal relationship with Western officials that I now have with the top officers of the companies I deal with." And given the size of his firm, French says, Western "may not be responsive to my needs."
The 59-year-old French knows what it is like to work for the Bell System. Although a native of Shenandoah County, French went to work for AT&T shortly after college and had a promising career there, helping to create a special nationwide telephone network for the Federal Reserve System.
But then French learned from his father, one of the officers of the then-Farmer's Mutual Telephone System of Shenandoah County, that the company, in desperate need of modernization, wanted a manager to obtain financing and to help upgrade the system.
Intrigued by the challenge, as well as by the idea of being his own boss, French applied, much against the will of his father, who said he was "giving up a good job and didn't know what [he] was getting into."
French returned to Edinburg in 1954 and quickly set about raising money. Unable to raise all that he needed from private sources, he overcame his reluctance to deal with the government and obtained a low-interest loan from the Rural Electrification Administration, which still offers the small telephone companies financial assistance.
French began to rebuild the system, replacing the manually operated phones, which required operator assistance, with dial phones.
The modernization continues. While many rural customers still have to use party lines, all Shenandoah customers now have private lines. And to handle calls efficiently and quickly, Shenandoah is installing digital switching equipment.
Additionally, Shenandoah offers a variety of telephone-related services, including security systems in which fire and burglar alarms are connected to a central Shenandoah office.
Just six months ago, Shenandoah began taking advantage of a new Federal Communications Commission ruling that permits telephone companies to operate cable systems in rural areas.
"It is an opportunity to serve a need of the area," French says of his fledgling cable operation, which is operating in the red and is expected to remain so for at least another three years. But even more significant, says French, "cable has the technical ability to replace the local telephone plant somewhere in the future," as people use it to bank and shop at home. If that becomes true, French wants to make sure he's included. He has even reorganized Shenandoah into a holding company with two affiliates--one the telephone, the other the cable company--so it can be ready to provide any other unregulated services that come down the road.
French acknowledges that sometimes it is difficult not being part of the Bell System. "You don't have the resources to help guide you in your decisions." Further, because Bell sets the technical standards for the nationwide network, "you don't always know what's coming down the pike," and can make incorrect decisions in trying to improve service.
That problem should ease somewhat after AT&T's divestiture agreement with the government is implemented in about two years. At that time, all local operations of the Bell System's 22 local operating companies will be spun off from the parent company. Long-distance service still will be operated by AT&T and its competitors, as is the case today.
However, French and other independent executives fear the settlement may create new problems, including uncertainty over how much money local companies will receive for connecting their customers to the long-distance network.
Even more worrisome to some independents are the constraints the settlement places on the local companies, limiting them to local telephone service and barring them from offering any unregulated services, such as the security and cable services provided by Shenandoah.
Historically, independent officials note, what happens to the Bell System eventually happens to the independents. That could mean that these firms may ultimately be barred from offering anything other than local service. "Hopefully, in the process of implementing the settlement , we won't be tarred with the same brush and have less freedom," says French.
"It's going to be a bleak picture during the next five to eight years" as all the phone companies adjust to the breakup, French says. But after that, "the ground rules will be known and we will be able to concentrate on all our opportunities."
For French, that is an exciting prospect.