A short passage through the history

Telephone History - Telephone Technology

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Service Lines and Switchboards
In 1877, construction of the first regular telephone line from Boston to Somerville, Massachusetts was completed. By the end of 1880, there were 47,900 telephones in the United States. The following year telephone service between Boston and Providence had been established. Service between New York and Chicago started in 1892, and between New York and Boston in 1894. Transcontinental service by overhead wire was not inaugurated until 1915. The first switchboard was set up in Boston in 1877. On January 17, 1882, Leroy Firman received the first patent for a telephone switchboard.

Exchanges and Rotary Dialing
The first regular telephone exchange was established in New Haven in 1878. Early telephones were leased in pairs to subscribers. The subscriber was required to put up his own line to connect with another. In 1889, Almon B. Strowger a Kansas City undertaker, invented a switch that could connect one line to any of 100 lines by using relays and sliders. This switch became known as "The Strowger Switch" and was still in use in some telephone offices well over 100 years later. Almon Strowger was issued a patent on March 11, 1891 for the first automatic telephone exchange.
The first exchange using the Strowger switch was opened in La Porte, Indiana in 1892 and initially subscribers had a button on their telephone to produce the required number of pulses by tapping. An associate of Strowgers' invented the rotary dial in 1896 which replaced the button. In 1943, Philadelphia was the last major area to give up dual service (rotary and button).