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The American Influence in Telefónica’s Public Relations Strategy

during the 20’s and 30’s.
Javier García-Algarra
Telefónica I+D, Madrid, Spain

Abstract — The Compañía Telefónica Nacional de España ITT provided CTNE technology, executives and engineers to
(CTNE, ‘Telefónica’ in colloquial speech then) was incorporated organize the company.
in 1924. It was a strategic move of New York-based holding ITT.
In contrast with a landscape of State-owned networks across The granting of monopoly to a foreign holding and the
Europe, Telefónica was the subsidiary of an American presence of Americans in daily operation created controversy,
corporation, with internal organization, procedures and ideas although Parliament had been closed and press was under
that revealed that origin. censorship. The management of this kind of ‘low intensity’
We study the influence in Telefónica’s early development of hostility was not unknown to Sosthenes Behn, an expert in
public relations policies created by American Telephone & public relations. From the first day on, CTNE made a
Telegraph. Although the environment was quite different, the new
sustained effort to create a positive public image, following
organization faced the same challenge that gave birth to the
brilliant AT&T’s communication strategy, from 1907 onwards, to the successful path of the giant AT&T. This paper describes
create the image of a “beloved monopoly”, in expression of the the influence of this model in the Spanish Company.
classical work of Roland Marchand.
Index Terms — Public Relations, Telefónica, ITT, AT&T.
Roland Marchand, studied in his classical work [9], the use
I. INTRODUCTION of storytelling and iconography by large American
corporations, as powerful tools for public relations. Industrial
On August 25 , 1924, King Alfonso XIII signed a Decree and commercial organizations were seen as ‘soulless’. They
issued by the military Directory headed by General Miguel struggled to earn public appreciation or, at least, to be non-
Primo de Rivera, granting the monopoly concession of Spain’s threatening. Banks, insurance companies or large
telephone network to Compañía Telefónica Nacional de manufacturers aspired to establish emotional ties with
España (CTNE) [1]-[2]. customers in the same way than Churches, the ideal of socially
Although formally a Spanish privately held company in that respected institutions.
moment, as the concession procedure required, CTNE was a Marchand devoted a whole chapter of his book to AT&T,
major strategic move of New York-based holding under the title ‘The Vision of a Loved Monopoly’, with the
International Telephone and Telegraph (ITT), leaded by following introduction:
Sosthenes and Hernand Behn [3]. Right after the Decree was
published, CTNE approved a capital increase from 1 million to “In 1908 the leaders of the N. W. Ayer & Son
115 million pesetas. ITT became the main stock holder and the advertising agency took a deep and worried breath as
biggest American investor in Spain [4]. they embarked on a significant new task for one of
Before 1924, telephone business in Spain was the nation's largest corporations, the American
underdeveloped [5]-[6]. The country had only about 80.000 Telephone and Telegraph Company. To launch an
lines. In contrast with the rest of Europe, instead of a public advertising campaign touting the virtues of a private
monopoly integrated in the Post and Telegraph Administration monopoly seemed a bold and possibly foolhardy
(PTT), there was a mix of tiny urban networks granted to venture. But the Ayer agency was eager to prove its
different companies and local corporations. Half a century of mettle, and AT&T's new president, Theodore Vail,
political mismanagement had produced one of the most was distressed by his company's unfavorable public
inefficient telephone systems of the continent. Spain had been image. The formidable obstacles only reinforced
a case of study of the European failure in this field [7]-[8], and Vail's resolve to fund the forging of a corporate
the need of a deep transformation was felt since the beginning image at a level unprecedented among American
of the century. corporations. Thus began the first, most persistent,
The contract between CTNE and the Government of Spain, and most celebrated of the large-scale institutional
contained a series of hard deadlines to build a new network, advertising campaigns of the early twentieth century.
with automatic exchanges in the main cities, a modern Its primary purpose was political—to protect a
transmission backbone based on electronic multiplex systems, corporation with an odious public reputation against
and a submarine telephone cable across Gibraltar Strait.

when Bell called of AT&T. Some new achievement was put into service and politicians were invited to inaugurate. including ITT. Besides those imagined prototypes. Sosthenes Behn was aware of the importance of public 3) Books. but finally completed in 1921. The most beloved were ‘first call corporation so triumphantly accomplish that task. Louis. Although telephone exchanges are industrial growth for the next seventy years. despite different critical approaches [10]-[11]. . had strong social publishing or advertising. and had a nasty reputation. and that its charismatic builder of the Bell System received a lot of image could affect its long-term welfare. emotional appeal. short description in two column layout. The superb telephone palaces 1) Advertising. Everything was a representation most relevant ones: of AT&T’s financial power [15]. There are rich collections of pictures taken for ‘The Colonel’. employees).” ceremonies’. well-mannered. and the sweet and delicate gourmet. Denver. Certainly AT&T was not the first involvement in the company was almost inexistent after the major American business corporation to recognize. images of buildings skills that allowed him to easily establish contacts at the and equipment. depicted and emphasis on quality and service were measured described with expressions and images of the Old Testament. they were externally designed to fit local styles in AT&T devised a set of resources and liturgies to convey its order to avoid rejection. AT&T published paid news in local and national pensions. AT&T was an innovator also in this field. not a historical one. Main offices were intentionally built messages. AT&T produced some of the first countries where ITT settled. The company hired writers and journalists to write relations for telephone business. St. with Presidents Harding and house [13]. In 1916. although his corporate behavior. But never attention [14]. A first call ceremony was organized ‘The Bell Telephone System’ edited by an external publishing to celebrate the achievement. N. Buildings played an important role in public relations strategy that underpinned the corporation’s Public Relations. He had been always in good books about its history and organization. two Among the methods deployed to publicize Vail's new figures were a kind of corporate patriarchs. a slogan. were invited to know them through little press reports with an artistic illustration. D. An important number of them were also journals. his Cuban Telephone Co. the vice president for Public Relations. large amount of advertisements with a consistent structure that Minneapolis) are a product of this policy. Public in general remained almost unchanged for decades. Mario García Menocal as the main guests [17]. threats of public ownership or hostile regulation. 1915) represented the Department of State when necessary. very first years. Page. from New York and was answered by Watson in San Marchand’s description of the question calls our attention to Francisco [15]. wrote after the creation of ITT. 6) Hagiography. Havana to Key West. 1913). during that period of turmoil. It had also an excellent collection of newsletters for shareholders. Daily works. Public events were very important for decisively set out to create a new corporate image for AT&T since the early days. They were like a and small investors. he behaved like a diplomat and was supported by the telephone operator (T. and transformed Alexander Graham Bell was the first one. Casson [12]. Theodore Vail responded to the challenge with a long term 8) Architecture. Later. Skidmore. Merritt. has been one of the giant signed a joint venture to build an underwater cable from most influential. premises. that it had an image. ‘The History of the terms with AT&T. had a major corporation so systematically and 7) Ceremonies. To embody Company values a pair of person and the origin of his fortune. one year Arthur W. as he liked to be called. Employees enjoyed programs of medical care and retirement 2) Press. These advantages were a common topic in different targets (technical. W. when Bell made demonstrations itself as did AT&T in 1908. And never did a of his invention in theaters. by the Great War. San Francisco. investors or advertisement. general public. special events and ceremonies were carefully highest level with the political and financial élites of the documented. familiar. elegant and (painted by Frank T. These are the bronze were use for lobbies. DC. the for good or for ill. commitment and sacrifice of AT&T employees. He fed the legend about his 5) Iconography. This technical challenge was suspended although it is a propagandistic work. 4) Pictures. and even today it’s cited as reference. Many of them were copied by other telephone with rich decoration and expensive materials like marble and companies all over the world. and a scheduled guided visits. After Theodore Vail passed away. The anonymous lineman fluent in Spanish and French). argument. Multilingual (he was imaginary heroes were invented. The most dramatic one There is general agreement among scholars on the success was the first transcontinental call in 1915. Slogans became very 9) Social benefits. and the Telephone’ of Herbert N. many of them under dictatorships corporate films in history. Vail was hearing the conversation from the ‘political’ nature of AT&T goals. The company was facing Georgia and President Woodrow Wilson from Washington the danger of public seizure. Ayer & Sons publicists produced a of 20’s (New York.

Gaspar…) to document every In August. so CTNE prepared appeared in Revista Telefónica Española [21]. a dramatic mise-en-scène. McKim is the fourth man counting from left to of the death of a relative [25]. trucks carrying poles. The collection has extraordinary liturgy scripted by CTNE publicists. In 1929. Publicidad. CTNE was present in press were assigned to “Departamento de Publicidad” (Advertising with advertisements that informed about intentions and plans Department). They were inspired in AT&T’s distance switch was inaugurated in Madrid. One of them wrote a long report with automatic exchanges were completed. (Alfonso. because activities included a guided visit for local journalists on is a detailed portrait of society with more than 5. and sometimes included useless information for the reader like the ‘splendid lunch’ menu. Later he occupying two pages. After the purchase of the European branch point of view it was a minor accomplishment. when all the telephones of Madrid . following the model of Revista been paid by CTNE [23]-[24]. The same themes blossomed in Department traveled to the USA. On inauguration day. usually he was an excellent writer and an empathic leader. ‘New on the activity in Spain [19]-[20]. They other ITT and CTNE employees prepared for it some reports appear in a group portrait. Spanish reporters of local newspapers were not used to deal with a professional public relations department and were delighted with helpful CTNE employees. Sosthenes Behn could not be present in Santander because Fig. this action was to provide graphic material to internal and Everything was new: building. King Alfonso XIII solemnly opened Santander aspect of the development of the Company. 1: Local journalists and CTNE staff after the inauguration of Santander Exchange. outer plant and the external publications. Afterwards. In December he was the host of right in the first row.000 previous days. Archivo Histórico Fotográfico de Telefónica. The title in Mundo Gráfico. and we have found that many of them reproduced paragraphs verbatim in their chronicle. Automatic telephone interesting remarks on the American telephone business that was nearly unknown in Spain. Cámara. even flattering. The same became Assistant Vice Chairman of ITT. CTNE ADVERTISING DEPARTMENT IV. engineers unknown in Spain. Public Relations From the first days of existence. and the building. equipment. Inauguration chronicles were very positive. the first automatic urban area in Spain. ITT also edited in Spanish Revista ‘first call ceremony’ was rehearsed. and Communication. Portraits of smiling young journalists smoking cigars and joking with Telefónica officers are an evidence of how efficient the script was. recently put in value [22]. 26th August 1926. ITT kept publishing Electrical Primo de Rivera. advertisements and leaflets to inform customers how to dial. was the first of the Company. the Major and the Bishop of Madrid. authorities and CTNE officers made some rhetoric speeches. CREATING A PUBLIC IMAGE In the original organization of Telefónica. but General of Western Electric in 1926. They received a text describing the Exchange negatives. evidences of CTNE activity’. CTNE hired the best Spanish photographers of the moment They had a design close to American counterparts. he put in practice some ideas common in America but Workers digging trenches. with photographs and texts. Telefónica’s collection has hundred of pictures of these special days. In graphic magazines we can find reports. The purpose of Central Office. Kenneth McKim. and stayed in Spain from 1924 to late 1928 [18]. An American. construction works. an excellent technical journal. In November of that year. since they were the creators of public opinion. Marín. picture can be reproduced by Mundo Gráfico and Blanco y Telefónica had a very well edited newsletter Revista Negro. Journalists received special attention. but none of them specify that the news probably had Telefónica Española. journals inserted short news of director. when a new and tiny long Telefónica Internacional. provides a hint on the purpose of McKim was the mastermind of CTNE public relations. including cumbersome details of electromechanical machinery that Chief Engineer Manuel Marín provided. III. a very important year when first AT&T and ITT. provided by the Departamento de According to the description of people that worked with him. where they met colleagues of Spanish newspapers in 1926. the Bishop blessed the equipment and the principal guest pushed a lever to symbolically put it into work. McKim and Chairman of CTNE Marquis of Urquijo were present. This American connection did not end adjusting machinery… all these topics had been reproduced when he leaved. A detailed program of historical and artistic value. a group of employees of the hundreds of times by AT&T. the Telefónica Cubana. guests and journalists were invited to a fine restaurant. In 1925. From the technical Telephone Review. and these press releases.

The rest of the conversation ran over equipment of the French PTT. “Sentinel of night” or “Weavers of American Telephone and Telegraph Company acted speech”. Fig. but also for ITT and for AT&T. 28th November.were changed to three automatic exchanges with King Alfonso wilderness or clean and spacious administration offices could XIII as the main guest. It was actually a pure operation of public relations. would fit in the series of the 1928. There is a striking detail. the first commercial radio telephone the Bell System. 2: King Alfonso XIII and special guests during the first call ceremony Madrid-Washington DC. Fig. Although composition and messages may closely resemble The ceremonies at Washington took place in the those of AT&T. the truck and everything is American. Spain. the Barclay-Vesey Building. Photographs of telephone poles had a special interest in transoceanic communications. York Telephone Company can be seen by the Woolworth acted in a similar capacity in Madrid [26]. We have found the shocking exception of one as master of ceremonies at Washington. ITT and CTNE only owned 500 km. King Alfonso XIII and President Calvin Coolidge talked construction of the American transcontinental line in Nevada by telephone: in 1915. The Spanish text sounds a bit weird. Behn and Walter Gifford together for the first and unique time. It deserved the same coverage than the inauguration on October 1929 of the radio link between Madrid and Buenos Aires. 1928. conserved by the New York Public Library. the British GPO and AT&T. near Zaragoza. with Marquis of Urquijo. President Walter S. the workers. Building. Smiling sweet operators and acrobatic linemen worked as well in Spain as in Architecture was very important in the AT&T model and the USA. Gifford of the annihilator of distance”. Graphic reports kept on working for years. Madrid. Sosthenes Behn seats in the chair out of the table. while American advertisement disguised as Spaniard. Biblioteca Nacional de España. the distance between Madrid and the French border. headquarters of the New International Telephone and Telegraph Corporation. President of the doubt. link was operated by the British GPO and AT&T. It was a ‘first call English. There is no Colonel Sosthenes Behn. three times longer and a technical success for ITT engineers. CTNE’s designs were original. but that in the deserted landscape of Los Monegros. of the circuit. On his right side is Marquis of Urquijo. Archivo Histórico Fotográfico de Telefónica. have been taken in any of the regional companies affiliated to In January 1927. Photo of Marín. In October taken by Gaspar in 1926. October 1928. It’s not by chance . There are directors' room of the United States Chamber of Spanish adaptations of very common topics like “The Commerce. ceremony’ not just for CTNE. ITT presentation of certain topics. “Service Useful for Public”. 3: Advertisement in magazine Mundo Gráfico. a literal translation from This occasion was very special. crews working in the ITT companies followed the same approach. There are amazing coincidences in the service was launched between London and New York. Pictures of internal premises.

Diego Martínez Barrio. these ideas that guided not only him. The European central offices. a ‘first call ceremony’. . CTNE policies on architecture. published a paid report in magazine Blanco y Negro. American executives withdraw this picture. Under these circumstances design of American exchanges. CTNE celebrated a for Gran Vía. Behn himself to describe the heroic virtues of linemen and operators. has to be popular. was opened [31]. was scenario of fierce fights. with some violence episodes. CTNE and the Romanian SART were the radiotelephone link with Majorca. put aside the question. and were quite progressive for that time in Spain. in October 1931. The American Social benefits for Telefónica workers were also inspired in Ambassador was the star of the ceremony. because he liked very much the Plateresque. The expression ‘Telephone Palace’ faded danger of public seizure had not finished for ITT. is also an vulnerable to political changes. Cárdenas didn’t speak English. Telefónica took defensive actions. It’s is difficult to compare a telephone exchange after losing confidence in its own ability to deal with Spanish building with other for similar purposes. but is still conserved in Romania. when the Exchange of Toledo. Bowers is the man on the lower right corner of accusations of colonialism. 4: First call ceremony from Toledo. Primo de Rivera regime had forbidden trade unions but the Company was blamed for paternalistic behavior. In addition. but all repeats twice that the reason of this behavior was ‘the spirit of the group of young architects under his command.that there are only two ‘Telephone Palaces’ in Europe: Madrid Manuel Azaña was present in the ceremony inauguration of and Bucharest. Photo of Rodríguez. because if it Governments. In October 1934. were service’. sumptuous. held some conversations with Cárdenas on the style he wanted Ten days before the Civil War begun. The text with Weeks. historical Spanish capital. and police. anarchist trade union CNT became very powerful among Telefónica workers and declared a series of strikes. and talked with the AT&T. Behn’s tactics to conquest markets were is essentially an industrial building. That day ended a brilliant decade of couldn’t be exploited easily by the public relations staff. Messages changed to insist in the importance of CTNE’s investments. So. and of instability. without aftermath of 1929 financial crisis. The headquarters of Gran Vía in commercial conflict became a diplomatic incident. The capital. showing that foreign policy may be a Weeks and Ignacio de Cárdenas. Ohio. It is also an advertisement. like her. statu quo. ITT began to find refuge behind the Department of State. The tension soon in Spain. some of them by the telephone building. and on quality of service. and a good increasing troubles. Louis S. 1931. After workers were This statement is one of the best formulations of AT&T defeated by the Army with a high cost of human lives. and the thirties are the epitome embassy of the Company in the Spanish cities. public relations. This change was a big drawback for ITT. and the period 1931-1932 was the most difficult for CTNE in this sense before the Civil War. useful and Despite a reasonable development of business in the rich. Prime Minister Manuel Azaña and the Minister in charge of Communications. Oviedo. A hostile political environment is a challenge for public relations. Today. Ambassador Claude G. Asturian miner’s strike advertisement must be located in the best place in erupted in a revolutionary way with violence between workers town. from the public view. the Spanish variant of Gothic in Renaissance. but the subsidiaries of ITT. praising though he stayed in New York several months in 1926 to work employees for bravery to keep the exchange working. grew to a climax in November 1932. the expression that AT&T had been using since 1914 transmitted by ITT executives and professionals. when an Act was passed Telefónica buildings follow the principles of utility and to review the concession [29]. This last wrote [28]: continuation of public relations by other means. CTNE couldn’t escape the publicity companies face failure. since the new Government wanted to declare null the concession of monopoly of 1924. Spain to Toledo. FIGHTING PUBLIC SEIZURE AND POLITICAL UNREST On April 14th. It Government pressed strongly the Spanish cabinet that finally was projected by ITT and CTNE Chief Architects. To prevent the 1936. V. 7th July. were against the Fig. Archivo Histórico Fotográfico de Telefónica. Both. King Alfonso XIII resigned and the Second Spanish Republic was proclaimed after Republican parties won local elections. and are quite different of Behn activated his contacts in the Department of State. American Madrid was the first American skyscraper in the Old World. but Major of Toledo (Ohio).

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