Responding to User Needs...with Services for Today and Tomorrow.
McLuhan coined the term global village in 1966 to describe the impact on the world environment of the newly emerging communications technologies. His thesis was that the speed and efficiency with which events from any corner of the globe could be instantly and communicated around the world would modify our traditional sense of time, of distance, of cultural and national borders and of personal isolation by altering our perception of the universe around us. The inauguration of international commercial satellite service, begun only a year before, added weight to McLuhan's observations.
Since 1966 the growth and expansion of the telecommunications field have begun to create the global village that McLuhan envisioned. The fusion of telecommunications and computer technologies has created value-added networks, bringing new services for business and consumers, including electronic mail, on-line information retrieval, on-line reservation services, electronic funds transfer, packet-switching, digital networks, cable television, videotex, and teleconferencing. To quote a recent U.S. Congressional report on telecommunications:
"Today, terminals attached to the network range from the familiar dial telephones and simple teletypewriters to literally hundreds of different devices such as facsimiles, data processing, and automatic answering terminals plus sophisticated telephone and switchboard systems. International telecommunications services include telephone and telegraph offerings, high-speed data communications, electronic message services, video transmission, and teleconferencing services. There is now a choice of international transmission media available including ratio, coaxial submarine cables, satellites, and shortly, fiber optic systems. Switching and network controls are increasingly being performed by sophisticated computers that are capable of providing a host of specialized services.".sup.1
As we have come to expect new developments in telecommunications, we have also become aware--through experience and through futurists like McLuhan--of the importance of anticipating the impact of these developments on all of us. This is one of the reasons we are assembled here today.
Like voters at a town meeting, representatives of governments, administrations, corporations, as well as technicians from throughout the world gather to share technology, to discuss problems, and to manage the introduction of new communications services. For us, this forum is literally a global village in which we meet to discuss our shared interest in the future of worldwide communications. From Wire to Westar
Because of your professional interests, many of you are already familiar with the name of "Western Union" and the historic reputation of The Western Union Telegraph Company.
Beginning with its construction of the first American transcontinental telegraph system more than 130 years ago, Western Union became a vital communications link in the development of the United States. The Company grew with the nation, and, as technology advanced--from the Morse key and sounder to the teletypewriter to multiplex telegraphy, microwave transmission, and message-switching computer--it adapted to new technology and kept pace with the nation's needs for expanded and enhanced message services. In addition, Western Union laid submarine cables that provided the foundation for international record communications. Today, Western Union has evolved to become the preeminent carrier of record communications in the United States. Its name stands for dependable, high-quality record communication services.
Western Union operates a nationwide communications network that includes multiple satellites in orbit, a transcontinental microwave system, electronic switching centers and local transmission lines in major metropolitan areas. Its InfoMaster computer centers complement this network with message-switching and processing capabilities; and three Central Telephone Bureaus provide convenent access to the Company's consumer services. Western Union service offerings include:
* Teletypewriter and other office messsage services, basically Telex I and Telex II (TWX), which for the core network for rapid written communications among business firms in the United States and throughout the world.
* Communications systems and services tailored to the special needs of business and government users including leased and shared systems that carry oth data and voice traffic. Some of these services, such as the transmission of television and radio broadcasts, are provided mainly through Western Union's Westar satellite system.
* Consumer services, such as Funds Transfer service and individual Mailgram, Telegram and Cablegram messages.
* Priority mail services, including volume handling of computer-originated Mailgram messages and a Computer Letter service.
* MetroFone.sup.sm, a long-distance telephone service.
* Other services that utilize the Company's service capability, most notably contract maintenance of communications-related equipment.
Telex if the largest single component of Western Union's business. The Company offers direct-dial Telex capability among 140,000 U.S. susbcribers and with 1.5 million Telex subscribers around the world.
In addition, Western Union Telex subscribers have access to other services, including Mailgram, Telegram, Cablegram and Money Order service. Other Telex customer conveniences include FYI News Service, which provides stock market data, commodity reports, weather reports, news and other kinds of information.
Until recently, only Telex subscribers could use Telex service. Last year, Western Union introduced a new service, known as EasyLink, which enables subscrbers to interact with the growing number of small businesses and individuals who have home computers, word processors or other higher-speed terminals. With EasyLink, using existing equipment and telephone lines, we've been able to create an enriched electronic mail network that links teleprinters, word processors, personal computers and intelligent terminals. Using an "electronic mailbox," EasyLink subscribers can call in to retrieve incoming messsages at their convenience.
Western Union took an early lead in satellite communications when, in 1974, we launched the first domestc communications satellites in the United States--Westar I and Westar II. With the launch of Westar V last year, we became the first U.S. company to have five domestic satellites in orbit. The Westar satellites carry voice, data, video, adn facsimile traffic. Our satellite system includes seven major earth stations in New York, Chicago, Atlanta, Dallas, Los Angeles, San Francisco and Seattle; and more than 2,000 small, customer-owned stations now communicate through our Westar system. In early 1984 we expect to launch the newest satellite in our fleet, Westar VI.
The Westar system has had a revolutionary impact on the U.S. television and radio industries by providing an alternative to the high cost of landline transmission and physical distribution of videotaped programs. Westar also serves the publishing industry. Complete editions of The Wall Street Journal, text and pictures of U.S. News & World Report, and color pictures and texts of regional editions of other popular magazines are transmitted via satellite.
Western Union's long-distance telephone service, MetroFone, also uses Westar circuits, in combination with the Company's extensive microwave network, to carry customers' calls.
Western Union has pioneered the sale of transponders as an alternative to leasing, with resulting advantages to both the Company and its customers. The economic return for sale is approximately the same as taht from a lease, but it allows a satellite carrier to share its risk, to ensure a full load at launch, and to exploit its satellite program fully without diverting capital resources.
Our Company market it satellite facilities, skills and experience worldwide. As the demand for satellite systems by emerging nations grows, we draw upon the expertise we have gained from building and operating the Westar system to provide guidance to others. For example, we served as advisor to the Republic of indonesia when its first communications satellite was launched, and we have been providing technical assistance to the Mexican government in establishing a satellite communications system to reach remote areas of that country.
A microwave transmission network of some 10,000 route miles, integrated with Western Union's satellite system, spans the American continent. This high-frequency radio transmission network reaches directly into most major metropolitcan areas to carry long-distance communications traffic.
At the heart of the transmission system of satellites, microwave relays and electronic switches is the Company's InfoMaster, one of the world's largest computer-communications installations. Two major InfoMaster centers provide automatic messasge switching and storage for 75 million messages a year.
Western Union's network is not just extensive--it is reliable. The InfoMaster computer centers consistently report more than 99 percent reliability, and this high degree of dependability enables Western Union to supply communications systems to the United States government. Some of our special government systems reach 99.99 percent reliability, which means that those systems are down less than 40 minutes in an entire year. Western Union networks seve the Department of Defense, the civilian agencies of the Federal government, the Federal Reserve Bank, and the Federal Bureau of Investigation.
Western Union's Central Telephone Bureaus are linked with the InfoMaster computer system. Strategically located across the United States, these telephone message processing centers form one of the largest privately owned telephone exchange complexes, with operators handling about 21 million calls per year.
The Field Service Division of Western Union is another extensive network, although not an electronic one. It provides a nationwide maintenance capability backed by 1,600 field technicians at more than 400 service locations.
In addition to maintaining the Company's subscriber Telex terminals, the Field Service Division is responsible for approximately 80,000 customer-owned terminals under third-party maintenance contracts. Its technicians service more than 400 different products, including mini- and micro-computers, word processing equipment, cellular mobile radios, air-to-ground radio telephones and satellite earth station antennas.
Western Union also provides maintenance service in the United States to customers of Dataforce, Bell Canada's thrid-party maintenance division. Similarly, Dataforce provides coverage for Western Union customers with terminals in Canada. This agreement marks the first international mutual service arrangement of its kind.
Telecommunications services to the nation--and the world--are provided through the interaction of Western Union's facilities. Multiple satellites, a microwave network, electronic switching centers and local transmission lines, three Central Telephone Bureaus, and an expert technical service division--all work together to enable Western Union to offer a wide range of reliable communications services.
Western Union had been barred by a 1943 amendment ot the USA Communications Act from continuing to provide its record communications services to overseas locations. That law was changed at year-end 1981 with the enactment of the Record Carrier Competition Act, which freed the Federal Communications Commission to authorize the Company to enter the international market. Western Union then filed tariffs with the FCC to extend Telex and other record communications services to more than 100 overseas countries and, in August 1982, inaugurated worldwide Telex service.
Direct connections with several key countres including Italy, Hong Kong, Singapore and the United Kingdom were established within a few weeks. By December, just four months after WorldWide Telex was inaugurated, our outbound message volume had passed the one-million mark.
Another step into global communications has been the introduction of Teletex. First introduced in the Federal Republic of Germany in 1981 and since established in several other countries, Teletex operates at almost 45 times the speed of Telex. It permits transmission and reception of formatted, letter-quality messages and offers memory and text-editing.
Western Union was the first carrier to bring Teletex service to the United States in 1983, having concluded an operating agreement in 1982 with the Ministry of Posts and Telecommunications of the Federal Republic of Germany to provide USA-Germany Teletex service.
For fast, convenient electronic transfer of funds, Western Union operates telegraphic Money Order service. A new aspect of this service is Worldwide Funds Transfer service, which enables United States businesses to send funds to virtually any foreign bank account in the world at a guaranteed rate of exchange.
Mailgram messages--America's first mail by satellite--are sent electronically to post offices anywhere in the United States, Canada and Puerto Rico for delivery with the next business day's mail. Extending this service across the Atlantic, Western Union has just begun a public messasge service that links the Mailgram service in the United States with the Telemessage service provided by British Telecom in the United Kingdom, giving users of either service access to both. Also in the U.K., we offer a service that provides a high-impact, low-cost message for commercial customers who do not require next-day delivery. The United Kingdom operation, a joint venture with a British firm, English China Clays, and known as Western Union Priority Mail, Ltd., offers communications services to businesses and government customers. New Ventures
A number of new telecommunications industry ventures are being developed by Western Union in response to the demand for advanced communications both in the U.S. and abroad. Three projects that are especially promising are the first air-to-ground public telephone system, cellular mobile radio telephone service, and a new satellite/cable communications system that will serve the New York metropolitan area.
Working with the Port Authority of New York and New Jersey, and in partnership with Merrill Lynch & Company, we are constructing The Teleport, the world's first satellite communications center and office park. When completed, The Teleport will have 17 earth stations offering direct access to all domestic and some international communications satellites. To this joint venture partnership, we bring substantial experience in satellite communications and the development of local cable networks. We will connect this cantenna farm" with nearby Manhattan, Brooklyn, Queens and New Jersey through a network of fiber optic cable.
The Teleport will enable New York area businesses that requie rapid transmission of data or video to gain access to satellites without having to establish a private network. These businesses will be able to reduce the high costs of traditional landline transmission.
Western Union has also acquired a 50-percent ownership interest in Airfone, a new air-to-ground telephone system. Beginning this year, Airfone will allow passengers on commercial airliners to call locations within the continental United States and in the near future, internationally as well. Airfone's coast-to-coast connections are made possible by a series of ground stations placed at intervals across the USA. Eleven major United States airlines have signed up for the service.
Airfone handsets, mounted on the bulkhead in both first-class and coach cabins, will be as simple to use as any telephone, and airline passengers will find that the voice quality is comparable to any terrestrial long-distance call. Designed to remove one of the last barriers to telephone communications, the Airfone system reaffirms Western Union's commitment to extend telecommunications technology wherever possible.
A series of joint ventures is taking Western Union into the fast-growing area of cellular mobile telephone service. Previously, it was all but impossble to obtain car telephone service in most large metropolitan areas. But the FCC has authorized cellular mobile radio service and opened up a major new communications market. Anticipating the dramatic growth in moble telephone service and equipment. Western Union in 1982 acquired Minnesota-based E. F. Johnson, a leading United States producer of mobile communications products. By combining the common carrier activities of Western Union and the equipment design and manufacturing capabilities of E. F. Johnson, we expect to strengthen the product range of both companies.
In separate alliances with other companies, Western Union has applied for licenses to deliver cellular service to many of the larger U.S. cities. Our objective is to become a nationwide, multi-system, interconnected provider of cellular communications service.
In the midst of technological growth and worldwide expansion, the major goal of Western Union has changed little from that of the Company's founders: to provide affordable, efficient, superior telecommunications services to the United States--and now to the world. Conclusion
Western Union is proud of its 131-
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|Date:||Jan 1, 1984|
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