"In 1876 I started again to experiment for the Western Union and Mr. Orton. This time it was the telephone. Bell invented the first telephone, which consisted of the present receiver, used both as a transmitter and a receiver (the magneto type). It was attempted to introduce it commercially, but it failed on account of its faintness and the extraneous sounds which came in on its wires from various causes. Mr. Orton wanted me to take hold of it and make it commercial. As I had also been working on a telegraph system employing tuning-forks, simultaneously with both Bell and Gray, I was pretty familiar with the subject. I started in, and soon produced the carbon transmitter, which is now universally used. "Tests were made between New York and Philadelphia, also between New York and Washington, using regular Western Union wires. The noises were so great that not a word could be heard with the Bell receiver when used as a transmitter between New York and Newark, New Jersey. Mr. Orton and W. K. Vanderbilt and the board of directors witnessed and took part in the tests. The Western Union then put them on private lines. Mr. Theodore Puskas, of Budapest, Hungary, was the first man to suggest a telephone exchange, and soon after exchanges were established. The telephone department was put in the hands of Hamilton McK. Twombly, Vanderbilt's ablest son-in-law, who made a success of it. The Bell company, of Boston, also started an exchange, and the fight was on, the Western Union pirating the Bell receiver, and the Boston company pirating the Western Union transmitter. About this time I wanted to be taken care of. I threw out hints of this desire. Then Mr. Orton sent for me. He had learned that inventors didn't do business by the regular process, and concluded he would close it right up. He asked me how much I wanted. I had made up my mind it was certainly worth $25,000, if it ever amounted to anything for central-station work, so that was the sum I had in mind to stick to and get--obstinately. Still it had been an easy job, and only required a few months, and I felt a little shaky and uncertain. So I asked him to make me an offer. He promptly said he would give me $100,000. 'All right,' I said. 'It is yours on one condition, and that is that you do not pay it all at once, but pay me at the rate of $6000 per year for seventeen years'--the life of the patent. He seemed only too pleased to do this, and it was closed. My ambition was about four times too large for my business capacity, and I knew that I would soon spend this money experimenting if I got it all at once, so I fixed it that I couldn't. I saved seventeen years of worry by this stroke."