Edison and the Electric Chair_ A Story of Light and Death - Mark Essig [44]
WHILE DISCOVERING his sentimental side at home, Edison grew more aggressive in his business dealings, because he was dissatisfied with the progress of the industry. The Edison lighting empire was organized as a three-tiered system. The Edison Electric Light Company held the patents and licensed them to the independent Edison manufacturing companies (the Lamp, Tube, and Machine Works). The manufacturing companies sold the equipment they produced either to individuals who installed isolated lighting systems for private use in one office building or factory, or to local electrical utilities that funded the construction of central stations and then sold electricity to customers in their areas. The directors of the parent company, Edison Electric, hoped that the Pearl Street station in New York would prove the reliability and economy of electric light and lead investors in other cities to organize and capitalize local utilities.3
Because the New York station was long delayed and over budget, however, cities that had been contemplating central stations shied away. The Edison Electric directors were content to bide their time and make money from the sale of isolated lighting plants. Edison, however, did not want his lights to dot the night landscape in a factory here and a hotel there; he wanted to light whole cities, to make the entire nation glow with the radiance of his lamp. He believed that the parent company should invest in more central stations to demonstrate the system's viability. The problem, as he saw it, lay not with his system but with Edison Electric's failure to promote it—yet another example, he thought, of "the characteristic timidity of capital."4
"If the business is to be made a success it must be by our personal efforts and not by depending upon the officials of our companies," Edison declared. "I am going to take a long vacation in the matter of inventions. I won't go near a laboratory."5
He became, as he put it, "a regular contractor for electric light plants." He did not have the resources to take on something as big as the New York station, so he concentrated his efforts on smaller towns. He plowed his own money into a new company called the Thomas A. Edison Construction Department. The company's agents recruited local investors, who then formed utility companies and paid Edison—in cash and stock—to install central stations. In the next year Edison installed central stations in nearly twenty towns. But local investors were slow with their payments, and the Construction Department's up-front costs were high. Most of the money was coming directly out of Edison's pocket, and he soon ran low on funds. In the fall of 1884 he disbanded the Construction Department and allowed the parent company to take over its assets and operations.6
Edison decided that if the officers of Edison Electric would not promote the business, he would change the officers. When Edison Electric was founded, he owned five-sixths of its stock, but he had sold most of his stake in order to finance the manufacturing firms. Edison, though, had more influence than the average minority stockholder. In a proxy battle at the stockholders' meeting in October 1884, he gained enough support from other investors to oust the board of directors and install a new one that included several of his closest friends, men who saw the business as he did. Francis Upton and Charles Batchelor won positions on the board, and the new president was Edward Johnson, Edison's longtime friend and formerly the vice president of the company.7
"I have given a perfect system, and I want to see it sold," he told a newspaper reporter. "I have worked eighteen and twenty hours a day for five years, and I don't want to see my work killed for want of proper pushing."8
Now that his friends ran the company, Edison pursued strategies that the previous board had avoided. Edison Electric filed patent suits against