The various telephone companies united in 1889 under the name of the National Telephone Company, but their work was carried on under many restrictions. They were not allowed to lay wires underground, and for a long time they were not permitted to establish trunk lines. The Post Office was perhaps still inspired too much with the idea that it was a profit-making institution, and it was making a fight for the telegraph, with which the telephone was now in serious competition. Another opportunity for the Post Office to step in and buy out the companies happened in 1890, but it was not taken. But in 1892 the Post Office compelled the company to sell their trunk lines to the Government, leaving the local exchanges in the hands of the company. So things went on until 1898, when a Select Committee was appointed by Parliament to consider whether the telephone service is calculated to become of such general benefit as to justify its being undertaken by municipal and other local authorities, and if so, under what conditions. The decision of the Committee was that so long as the telephone service was not likely to become of general benefit the present practical monopoly in the hands of a private company should continue. The telephone, we see, was still considered only a luxury for the few, and although certain foreign countries were making great strides in the direction of a general use of the system, Parliament was not yet prepared to sacrifice the private speculator. The committee, however, recommended competition by the Post Office and local authorities, and in pursuance of this policy the Post Office in 1899 decided to establish a telephone system in London in competition with the company. Thus began the first direct connection of the Post Office with the working of the telephone. But there is always something unsatisfactory and not in accord with the fitness of things when the State enters into competition with any of its members in business undertakings, and this attempt was certainly not advantageous to anybody. In 1901 the Post Office came to an agreement with the company in regard to the London business. The company agreed to free intercommunication between its subscribers and those of the Post Office, and undertook to charge rates identical with those fixed by the Department. The long struggle of the company to obtain permission to lay underground wires was settled by the Post Office agreeing to provide these wires for the company at a rental. Finally the Post Office undertook to buy out the National Telephone Company in the year 1911.