By 1909, the American Marconi Company had a virtual monopoly on wireless communications on the West Coast. That year, a small Palo Alto company, Poulsen Wireless Telephone and Telegraph Company (soon renamed Federal Telegraph Company), emerged as a dangerous competitor.
Recent Stanford graduate Cyril Elwell was determined to be a part of the West Coast wireless revolution. Elwell’s company introduced the first commercially successful system of continuous wave wireless telegraphy, a major improvement over the widely-used Marconi spark system.
Over the next ten years, Federal engineers led by Cyril Elwell and Leonard Fuller made significant improvements to Valdemar Poulsen’s original arc transmission technology, developing high frequency, high power, and highly efficient systems. The company’s ability to design and build ever larger transmitters, along with the superior performance of Poulsen transmitters over other systems then in use, made it a major player in long distance wireless communication. Winning important contracts with the US Navy, Federal grew to more than 300 employees by its peak year, 1917.
Ironically, the arc was made obsolete by vacuum tube technology developed in Federal’s own workshops by a team that included Lee de Forest. Federal’s other innovations included significant improvements to radio reception and loudspeakers, glass tube production, and important improvements to maritime navigation and communication.