We have seen in a previous chapter that just at the time when the mail coach service had been magnificently organised, and vast sums of money had been spent on improving the roads, the steam engine upset all the calculations of the postal officials. Something of the same kind seemed to be likely to happen in the case of the telephone and telegraph. It is easy to be wise after the event, but the telegraph was still a new toy in the hands of the postal officials, and their strongest efforts were being directed to improve this branch of the service. But if the Post Office was not over enthusiastic in its welcome of the new medium it was at any rate keen in the assertion of its own rights. When the Edison Company announced its intention to start telephone business in London the Postmaster-General at once instituted proceedings against the company for infringement of his monopoly rights under the Telegraph Act of 1869. This was a test action, and Mr. Justice Stephen, who was the judge, decided that the telephone was in the meaning of the Act a telegraph, and that telephone exchange business could not legally be carried out except by the Postmaster-General or with his consent. The decision covered also future inventions in regard to “every organised system of communication by means of wires according to any preconcerted system of signals.” This, it has been said, was the psychological moment when the Government might then and there have taken advantage of its position and have incorporated the telephone with the telegraph system. But Great Britain acts cautiously in these matters, and as I have said she has an intense respect for private enterprise. It is only when competition between rival companies obviously fails to meet the wants of the public that she consents to allow her Government to step in and do the work itself. It was characteristic of our nation that divided counsels should so long have been allowed to continue over the telephone business; it was characteristic of our officials also, that they were not prepared to launch out into any fresh expenditure of public money with the purchase of the telegraphs still weighing heavily on their consciences. Public opinion would not have allowed the Post Office to act the dog in the manger over the business, even if it desired to do so, and it proceeded to grant licences to the telephone companies to work within certain areas. In 1883 the Post Office did in fact propose to engage in active competition with the companies, but the Treasury opposed the policy on the ground that the State should at most be ready to supplement and not to supersede private enterprise.