THE HISTORY OF CABLE & WIRELESS
Headquartered in London, Cable and Wireless plc describes itself as a world leader in developing and providing telecommunications solutions around the world for more than 125 years. Today (2001) the company has 17 million customers in more than 70 countries, with annual revenues of about $14 billion.
Its origins lie in the entrepreneurial activities of Sir John Pender (born 1815 in Scotland), whose enterprise and foresight led to the creation of the world's largest telecommunications network. In 1852, he invested in the Anglo-Irish Magnetic Telegraph Company, the first step in a life-long involvement with international telecommunications. In 1856, Pender became a director of the Atlantic Telegraph Company, and between 1864 and 1872 founded or co-founded four major companies: the Telegraph Construction and Maintenance Company, the Anglo-American Telegraph Company, the British Indian Submarine Telegraph Company, and the Eastern Telegraph Company, of which he was chairman until his death in 1896.
Although these international cable activities were extremely profitable and successful, the company began to face competition from wireless communication (as did its competitors). Already in 1910 the Marconi company proposed to build and operate a network of high-power stations linking the whole British Empire, charging rates half those of cable. This ‘Imperial Wireless Scheme’, it was argued, would be of great strategic advantage for the British government, providing ships of the Royal Navy with a global means of communication unhampered by vulnerable landlines and submarine cables. The government hesitated, however, for fear of handing the company a monopoly. After the First World War the Marconi company revived the idea. This time some of the dominions were in favour; the British government, still fearful of commercial monopoly, was not. Regardless, the company signed contracts to build long wave ‘imperial’ stations in South Africa and Australia, whilst Canada and India also opted for beam transmissions, as did. This forced the hand of Britain.
Autumn 1927 saw the completion of beam network and shares in cable companies went into free-fall. The crisis forced a conference of empire governments in January 1928 and by March merger terms were agreed. The passing of the Imperial Telegraphs bill at Westminster in December 1928 led to the formation of an amalgamated overseas communication organisation that left wireless victorious but with a minority of shares and subservient to cable interests. In April 1929, with terms now ratified by the dominions and the British government, a new monopoly organisation was formed, Cables & Wireless Ltd, shortly afterwards renamed Cable & Wireless Ltd. Marconi was bitter; although he had achieved his ambition of a worldwide wireless network, he - and his company - had been robbed of the prize.
Under the new arrangement the Post Office handed over its long-distance radio stations, also two Anglo-Canadian cables to the new company on a 25-year lease basis. In turn the company had to operate on semi-public utility lines under the control of an advisory committee. In the event, Cable & Wireless went from strength to strength and by 1939, Cable & Wireless owned the world's most extensive international cable and radio network and operated worldwide.
In 1945, the UK Chancellor of the Exchequer announced that, as part of the post-war nationalisation programme, the telecommunications services operated by Cable & Wireless would be transferred to public ownership. The proposal was granted Royal Assent in 1946 and the Company was nationalised in 1947. Control of the overseas services of Cable & Wireless from the United Kingdom was transferred to the Post Office and the radio stations that the P.O. had leased to Cable & Wireless in 1929 were handed back.
Cable & Wireless continued as a Government-owned company until 1981, when the UK Government disposed of just under 50 per cent of its shares and the company was listed on the London Stock Exchange. In November 1983, the UK Government was allotted one Special Rights Preference Share in the Company prior to the disposal of its remaining Ordinary Shares via two further public offerings in December 1983 and December 1985.
Since 1999 Cable & Wireless has re-invented itself and disposed of businesses no longer part of its core objectives (for instance its cable television and consumer Internet services in the UK). Its new strategic priorities are to:
- Focus on business customers
- Base future growth on Internet Protocol and data services
- Operate globally
- Invest and expand aggressively in the USA, Europe and Japan
Based on material found on the Cable & Wireless and Marconi Calling websites and elsewhere. This is not a complete history but it covers some key points.