In Germany, where Bell’s telephone system was actually introduced as a regular means of public communication before it had reached that stage of development in its country of origin, the United States, it was from the first a State system, being grafted on to the existing State telegraph system.

The next stage of development of the communications services was the rise of wireless telegraphy and telephony, and we can now briefly examine the situation that arose in 1928 in Great Britain owing to the fact that the Post Office “Beam” wireless telegraph service was so successful that it was ruining the cable companies whose services could not compete with wireless.

This new situation is of particular interest because it marks a very greatly changed attitude of the capitalists generally towards monopoly. Fifty years earlier the capitalist State would not have contemplated allowing a private monopoly to be formed. If, for technical reasons, there had to be a monopoly in the hands of the State so that it could be strictly regulated in order to serve the interests of the capitalists as a whole. But by 1928 opinion had changed with experience, and private monopoly (under restrictions imposed by law) had become politically practicable.

The treatment of cables and wireless and the formation of the Cable Wireless Merger by the Government illustrates this change.

The “Imperial Wireless and Cable Conference” 1928 reported that “the cable undertakings operating between the constituent parts of the British Empire could be unable to continue on a paying basis in face of unrestricted competition on the part of Beam Wireless Services.”

Accordingly, the Conference recommended, not the nationalisation of the companies, but the unification of company cable and wireless systems under a merger Company, to which were to be transferred both the Post Office Beam Services and Government-owned transatlantic cables, the former on a 25 years lease and the latter on payment of a stated sum.

Among the reasons urged by the Conference for this step were the possibility that bankrupt cable companies might be acquired by foreign purchasers and that “cables . . . still possess great value for the maintenance of necessary communications between the constituent parts of the Empire for commercial and strategical purposes.”

Fifty years earlier it would have been hardly conceivable that Parliament or business interests generally would have approved the establishment of a private monopoly, but with the development of capitalist industry towards monopoly, the establishment of the Cable and Wireless Merger had become acceptable.