 Standard Telephones
and Cables (Australasia) Pty Ltd
To examine the history of STC in Australia, we start with Alexander Graham
Bell. He promoted his new telephone in Europe, and his father-in-law, Gardiner
Hubbard, followed him to Europe to set up manufacture. The Belgian government
was enthusiastic about introducing the telephone, so Hubbard arranged to set
up a new company in Antwerp, Bell
Telephone Manufacturing. It assembled phones imported from the U.S. at first,
but expanded to design and build its own range of telephones. Subsidiary factories
opened in other European countries to assemble phones for their particular markets.
They were usually named Western Electric, as this company was now Bell's manufacturing
arm.
Over the next quarter century telephone use increased dramatically. In the
U.S., two problems arose. The U.S. government became concerned at the power
of the Bell company, which was almost a monopoly. The second problem was that
the Bell company was in trouble with its customers because it could not meet
the growth demands placed on it.
Australia had a Western Electric sales and installation company, although its
sales were never large during the WE years. It sold the first telephone exchanges
in Sydney and Melbourne to private companies, in the face of some government
indifference. Once the new Australian
PostMaster General's Department was set up, they standardized on WE switchboards
(following the British Post Office lead) so WE had a fairly ready market for
their products. Western Electric's local agent, Richard Hungerford, developed
close ties with the new PMG and was able to advise on and discuss telephony
and wireless - the start of the close cooperation between government and manufacturing
industry that was to follow.
The PMG was having the same problems as the Bell company in the U.S. - they
could not meet demand. During the Cook Royal Commission into the PMG in 1908,
Mr Bell (who was in the country at the time) was invited to address the Commission.
He suggested that the CB manual switchboard system be widely adopted as the
"most perfect system at present existing". This was undoubtedly
commercially motivated, as the Strowger automatic system was increasingly penetrating
the market, sold by Bell's rival, Automatic Electric. Bell did not have an automatic
system at this time, but had bought the rights to the Lorimer brothers' system
and was still redesigning it for production at BTMC. As a result of the Royal
Commission's findings, the PMG stayed with CB for most exchanges, but they showed
some independence and began installing Strowger step-by-step exchanges for evaluation.
As BTMC's Rotary system came into production in Europe they installed and evaluated
it as well. At this point the APO and the state Railways were still largely
using Western Electric-based equipment, but WE was not manufacturing in Australia.
This became a problem during the First World War, when supplies of important
electrical equipment ran into shortage due to interrupted shipping from Britain,
and Britain's demands on its factories for its own war supplies.
Following the War, Western Electric diversified its product range to include
electric generating sets and wireless receivers - all still imported. The PMG's
demand for underground cables increased, and was met by imports from the British
WE factory and others. Economy measures such as the introduction of WE three-channel
carrier systems helped, but the basic problem was the sheer amount of cable
that was needed. The copper for the cables was being produced in Australia,
shipped to Britain, made into cable, then shipped back to Australia - the shipping
costs were a serious impediment to the telephone network's development.
In 1925 Bell did a deal with International Telephone and Telegraph. It sold
all its overseas holdings to Sosthenes Behn's ITT. This gave it the money to
develop the U.S market, and gave ITT a group of factories and customers. It
also removed some of the political pressure by letting Bell meet the needs of
its U.S. customers. Following the change of ownership, ITT needed more manufacturing
facilities to support the national telephone companies it was administering.
Behn's intention was not to make a quick profit, but to build an international
network of telephone systems managed and supplied by his own companies. The
Western Electric companies were renamed Standard Electric (in various local
languages) in Europe, Standard Telephones and Cables in Britain, and Standard
Telephones and Cables (Australasia). ITT also now owned Antwerp's Bell Telephone
Manufacturing Company. They left this name unchanged, and gradually centralized
their research and development there. Under the terms of the sale Bell would
not sell internationally, and ITT would not sell into the U.S. market.
All the new ITT companies had manufacturing facilities except STC in Australia,
and ITT immediately set about changing this. In 1926 engineer Sandy McPhee
arrived. He set up a new factory at Chippendale in inner Sydney and manufacture
began. Their first telephone was a licensed copy of Western Electric's 317
wooden wallset, using imported parts and local woodwork. An important introduction
was the local assembly of bakelite telephones. At first the cases and many
parts were imported from Britain, but as manufacture settled down the factory
took over more of the production except the dials and cases. The PMG Department
tested the new factory with an order for magneto switchboards and repeater
coils. The coils required a high level of precision, but the factory proved
up to the task. The PMG adopted the same policy as the British Post Office
- contracts were let to local firms where possible to build up Australia's
expertise in manufacturing and develop new technology, and reduce reliance
on imports.
Wireless transmitters and receivers went into production, as well as public
address systems. Importantly, the factory's design department began developing
its own designs. By 1930 an all-Australian radio receiver was being produced.
Many early wireless stations in Australia and New Zealand were equipped with
STC transmitters. The Rotary automatic switching system, inherited from Bell
and perfected by BTMC, was selected for installation in New Zealand, but Australia
opted for step-by-step, so STC did not yet build exchanges in Australia.
By 1936 STC had to build a new factory at Botany Road, Alexandria. Its factories
at Redfern and Chippendale plus the administration staff at the city office,
were finally together in a single building. Some space was used to produce
high-precision radio valves, which were still imported up to this time. And
just in time, too.  World
War 2 began and STC took on an increasing Defence contracting role. They produced
the Type 109 field wireless sets, radio direction beacons, precision parts
for artillery gunsights, and airborne wireless sets. Their previous work on
expanding the PMG's carrier systems paid off, as Australia at least had an
adequate telephone network to carry the wartime traffic. The staff of over
1000 now had to produce parts to replace those previously imported. Even in
its main areas of expertise, telephony and radio, STC had imported many parts
to include in the locally-produced equipment. The basic No 13 telephone transmitter
and the two-magnet receiver had to be redesigned, tooled up for and produced
locally with no overseas help. There was one notable gap in the range. Although
STC imported electrical cable and insulated wire from Britain, these cables
were still not being produced in Australia. A conglomerate of companies including
STC set to producing insulated cable, so now most of the equipment could be
completely Australian-made during the critical wartime years. The need to
produce military parts required that production of civilian items like telephones
be ceased for the duration. Quality remained high in spite of wartime pressures.
STC was able to produce radio equipment for U.S. forces stationed in the south
Pacific areas.
Left: "D" set field telephone
In a sidenote, the Woolwich STC factory in Britain was hit by a V1 flying bomb.
The Australian staff arranged for food parcels to be sent to their British counterparts.
120 pounds was raised for the dependents of those killed in the explosion.
 With the outbreak
of the war, Belgium was overrun and exports from BTMC and France were closed
off. Fortunately most of the design work was removed from the factory in time,
and the manufacturing load was taken up by ITT's other companies. ITT set up
the Federal Telephone and Radio company in the U.S. and began production there.
This factory was intended to supply their markets in Latin America. At the end
of the War they also provided Australia with quantities of their FTR804A
magneto phone and FTR803 auto and CB phones until the Australian factory could
retool for post-War production.
Left: Federal FTR803 CB desk phone
By the end of the Second World War STC was Australia's biggest manufacturer.
The company returned to peacetime manufacture. Rather than reduce staff it
used its excess capacity to produce electric irons and other domestic appliances.
STC also returned to its core business and made large quantities of the new
 400 series
bakelite telephones and exchange switchgear to catch up on post-war demand.
The 400 was based on an Ericsson design, but was substantially redesigned
for Australian conditions by STC and AWA. All but the dial would be produced
in Australia, following the introduction of new high-pressure bakelite moulding
presses at a new Liverpool factory. The automation of the many small country
manual exchanges was a priority and a new exchange based on the British 2000
relay was to be produced in large numbers. The contracts were shared between
STC and TEL, another local manufacturer (now Plessey). The PMG was still prepared
to support local industry, and the Government of the day did not want to lose
the expertise that had been built up during the war. They put a condition
on the ten-year contracts, though. STC and TEL had to sort out a uniform step-by-step
switching system for use throughout Australia. The companies got to work and
many country areas finally enjoyed 24-hour telephone service.
In spite of this STC still found time to develop a mobile telephone system
for the Snowy Mountains Hydroelectric Scheme vehicles. Rather than decrease
after the War, STC's staff actually increased to 2289 by 1948.
A new development also excited the company's interest - television. The Government
had decided to introduce it, but which system? STC could see a large consumer
market in domestic TV sets and in the transmitters, but there was no technical
expertise in Australia on the subject. International Telecommunications Laboratories
Inc was a global ITT company formed to centralize and disseminate information
on what all ITT's subsidiary companies were up to in the various technical fields.
They had knowledge and experience of the three main systems - the British 405-line
system, the U.S. NTSC 525-line system, and a new European system, 625-line PAL.
Eventually the technically superior PAL system was decided on, and STC began
manufacture of transmitters and TVs at the factory in Liverpool.
Another new technology was introduced around this time. Professor Harry Messel
of Sydney University's Physics Department enlisted the company's help to produce
Australia's first computer, known as SILLIAC. It was valve-powered, used 25
kilowatts of DC power, and was so important to the introduction of computers
in Australia that parts of it are preserved in the Powerhouse Museum in Sydney.
By the 1960s telecommunications in Australia needed a major overhaul. There
were too many manual exchanges, too many trunk exchanges, not enough phones,
cables or telephone numbers, and the population was becoming very unhappy
at the shortages. As part of the overhaul a new telephone was proposed.  Traditionally
Australian telephones had been based on British designs, but the level of
technology in Australia had improved. Australia's varied conditions meant
that overseas phones were not always suitable, and it would be better to design
a local telephone. The result was the Australian Post Office 800
series. Its styling and some of the electronics were based on BTMC's Assistant
telephone, the electronics on the British 700 series, and the case was in
the latest polyurethane plastics. It also eventually led to the manufacture
of transistors in Australia.
Left: 801 ColorFone with imported dial
The new plan would be supported by a new switching technology. Step-by-step
would be replaced. There were two contenders - STC's French-designed Pentaconta,
and L M Ericsson's Crossbar. Ericssons had no local manufacturing facility,
and the PMG was adamant that it was going to be locally-made. The PMG installed
a Pentaconta at Kew in Melbourne, and a Crossbar at Toowoomba in Queensland.
In the final evaluation, the Ericsson product won. The Government brokered a
licensing deal that saw STC and TEL gain ten-year contracts to produce Crossbar
under license from Ericssons. LME saw the scope of the project and established
their own facilities in Australia, enlarging the country's industrial base further.
By 1961 STC was producing Crossbar in cooperation with the other two companies.
They continued importing the Pentaconta for PABX sales, eventually filling more
than half the market.
Sosthenes Behn retired as President of ITT in 1956. He died the following year
aged 75. He never visited Australia, and his death was largely unnoticed here.
Worldwide, ITT's role is still debated in historical terms. It was one of the
world's first multinationals, and as a result its companies got involved on
both sides of a number of wars. Its part in Australia's development cannot be
played down. Its local company, STC, developed or helped to develop many Australian
industries and moved the country into levels of technology out of proportion
to the country's size. ITT's low level of management interference let STC grow
into a truly Australian company.
With Behn's death the company's role changed. It withdrew from consumer electronics
like TV sets, correctly anticipating the growth of cheaper Asian imports.
STC also faced the end of its ten-year contract with the PMG. Ericssons by
now was an Australian manufacturer as well, and the STC- TEL duality could
no longer be maintained.
STC now drew on one of its major strengths - its sheer diversity of expertise.
Asian countries could make cheap consumer goods, but STC was decades ahead in
high-quality industrial electronics. It decided to specialise in areas like
microwave systems, Defence signaling systems, and power supply. It could draw
on overseas expertise from ITT's companies, pooled through International Telecommunications
Laboratories, and through BTMC which was now a major R&D centre. STC also
became an exporter. By 1969 it was exporting its products to 63 countries. Its
reputation for ruggedness to meet Australian climatic conditions helped it gain
markets in difficult countries like Vietnam, India and Mexico. The Pentaconta
PABX was also exported, as well as a new Metaconta 10C trunk exchange developed
by BTMC. In the 1960s and 1970s STC moved into the new field of data transmission.
 Unfortunately
by the 1970s rising wages made Australian manufacturing expensive, and a number
of divisions were closed - Components, Export and Radio Transmission. Production
of printed circuit boards and mass-production soldering and construction techniques
were developed and introduced to decrease production costs. Increasing transistor
and PC board expertise allowed the introduction of keypads in Telecom's Touchfone
805 series, and finally the phasing out of the old rotary dial.
Construction of ARE11 circuit boards, a transistorised upgrade to the crossbar
exchange, was a useful spinoff of PCB technology. In 1983 Pulse Code Modulation
in a digital carrier system was introduced by Telecom Australia. The contract
for the components went to STC, who had imported a system from Britain to become
familiar with it and worked with Telecom to develop it. Further sales were made
to Telecom in New Zealand in 1987.
 Telecom still
worked closely with STC. The company got the contract to produce the Goldphone,
a leased public coin phone. Most of the phone was produced locally, with a coin
mechanism from Anritsu in Japan. Production of other phones kept up, and in
one magic week in 1985 STC produced 16,000 Touchfones for Telecom.
Telecom could not keep up with the growth of the private PABX market, and
had allowed the commercial companies in. STC was now a major supplier of PABXs
to Australia.
In 1981 STC won a Telecom contract to build the N series Commander small business
system. It was designed by Nitsuko in Japan, but required some redesign to make
it suitable for Australian conditions. Again drawing on expertise from BTMC
in Antwerp, STC produced the first Cardphone public telephone for Telecom.
In 1987, suffering from poor leadership and a general loss of direction, the
ITT companies were bought by Northern Telecom under their trading umbrella company
Alcatel NV. STC Australia became Alcatel-STC.
 In 1988 STC,
AWA and Telecom produced the Touchfone TF200 to replace the 800 series Touchfones.
Despite early problems with the keypad, the phone's descendents are still the
standard Australian telephone. 1990 saw the Touchfone T200 Executive, which
required an extra telephone production line at Liverpool. Touchfone production
was centralized there, while Alexandria handled payphones, Production at Liverpool
reached 5000 phones per day, and a major part of this was being exported. Its
products now carried the Alcatel name
The late 1980s saw work like circuit board production contracted out, but the
company moved back into one of its traditional areas - cramming more phone calls
onto a telephone line. They gained the manufacturing rights to an Australian-designed
Metropolitan Area Network concentrator and its rural counterpart, the Remote
Integrated Multiplexer. These products are now also being exported. Telecom
projected installation of 1.000,000 RIM lines by 1998. These RIMs were designed
to replace the thousand or so rural electromechanical exchanges still in service
The development of computerised exchanges was met by the design of Alcatel's
System 12. The design came from the United States, and was brought to production
level by a team that included STC engineers at the BTMC works in Antwerp,
also now owned by Alcatel. Telecom intended upgrading its AXE exchange gear
and competition for the tender was intense. The $1.5 billion contract would
last for three years. At this point AT&T, the successor of the Bell company
and Alcatel's chief global competitor, looked at the Australian market and
offered their equipment. The situation was tense until the Government decided
in favour of the local companies, Alcatel, Ericssons and Siemens.
The introduction of mobile phones and services has given the company a whole
new area of infrastructure to develop into. As usual much of the technology
was brought in from overseas companies then extensively modified to work reliably
in Australia. Telecom now buys in much its telephone needs, though, especially
in areas like mobile phones. Other makers entered the market and Telecom's phones
now carry names like Thomson or LG. Although most telephone and data equipment
is now made overseas, the infrastructure on which they depend is still likely
to bear the Alcatel brand.
And so, the company continues, now as Alcatel Lucent. It is a major export
earner for Australia, and its R&D and quality control keeps it ahead of
most of its competitors.
References
Bateman J "History of the Telephone in New South Wales" 1980
Conklin R "Federal Telephone & Radio Corporation's Simplified Subscriber
Telephone Set" Singing Wires Newsletter, December 2003
Moyal A "Clear Across Australia" Thomas Nelson, Australia
1984
Murray, J "Calling The World" Focus Publishing P/L, Sydney
1995
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