Historia de Telefónica: 1924–1975. Primeras décadas: tecnología, economía y política (review)

The wave of privatization of state-owned telecommunications monopolies (known as Post, Telegraph, and Telephone [PTT]) in the 1980s, with the notable exceptions of countries like the United States and Spain, prompted scholars to write several histories of this industry in the 1990s. Scholars in economics and technology, business, and economic history have researched the impact of telecommunications in economic growth, the determinants of their diffusion and of the making of national networks, the role of states on these processes, and the influence of the rise of telecommunications on management practices. The Spanish case has not been out of the research agenda. However, literature has traditionally focused on the dawn of telecommunications in the country (i.e., before the arrangement of the national telephone monopoly in 1924) or on very recent times, coinciding with the end of the monopoly and the internationalization of its holder, Telefónica. The Historia de Telefónica by Ángel Calvo constitutes one of the most comprehensive studies of this sector in Spain for the period in between the industry’s origins and the end of the monopoly. Calvo is an emeritus associate professor of Economic History at the University of Barcelona and a well-experienced researcher in Spain’s telecommunications history.

The book examines the evolution of this company, one of the largest and most internationalized in the country, since its foundation in 1924 until 1975, the year in which the Spanish economy opened after decades of protectionism. The book opens with the 1877–1924 period (1877–1924), when a contradictory and restrictive legislation resulted in an expensive, low-quality national network based on small local companies with poor productivity and low profits. These firms used heterogeneous technologies that hampered the building of a national network up to 1924, when the Spanish government decided to create a national monopoly. Chapter 2 focuses on the reasons behind the State’s concession of the monopoly to a private, Spain-based but foreign-owned company, such as the Compañía Telefónica Nacional de España (hereafter Telefónica), which was a cornerstone of the US-based International Telephone and Telegraph (ITT) later global expansion. The contacts developed by ITT among local politicians, engineers, and business groups explain much of this governmental decision, as well as the firm intervention of the American embassy in the country. The Spanish sector emerged then as an exception in Europe, where the PPT model was already the rule by that time. As it is shown in Chapter 3, the two decades that followed the monopoly concession were of rapid modernization, explained, among other factors, by capital availability, the access to the technology developed by the International Standard Electric, the manufacturing branch of the ITT group, and the organizational changes implemented by the American firm (this last point, however, deserved more attention by the author). However, the fact that a strategic sector such as the telephone was in foreign hands aroused a strong opposition among different groups since the very beginning, to finally push for the nationalization of the company in 1945 by part of the nationalistic government established after the Spanish civil war. The nationalization, though, was preceded by several years of conversations and cut and thrust analyzed in Chapter 4. In the following decades, and particularly in the period of economic growth of the 1960s, the domestic demand of telephone services boosted. In Chapter 5, the author examines how the company tried to satisfy this demand given the existing technology (and the threat of network saturation derived from it) and the state regulation, very reluctant to increase fares. It would have been very interesting, though, to compare the Spanish case with other European countries under the PPT framework. Chapter 6 deals with Telefónica’s first step toward internationalization, a process here understood as the...