Elisha Gray, inventor of the variable resistance microphone

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Elisha Gray

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Elisha Gray has gone down in telecom history as the man who Alexander Graham Bell beat out for the invention of the telephone. To this day many continue to argue that Gray was actually the inventor of the telephone, not Bell.

The controversy over who developed the telephone--Bell or Gray--began in 1876 when Gray filed a patent caveat for a telephone on the very same day, Feb. 14, 1876, as Bell's lawyer.

At issue was Gray's use of a water transmitter that could be used "for transmitting vocal sounds telegraphically." While Bell did test Gray's water transmitter design after Bell's patent was granted, he only used it as a "proof of concept" to see if he could transmit "articulate speech."

What followed was two years of patent battles between Gray, Western Union and the Bell Telephone Company.

In 1877, Gray filed another patent for the same telephone technology. Even though Gray eventually abandoned his patent caveat, the end result was that after two years of litigation, Bell was awarded rights to the invention and now is credited as the inventor of the telephone.

The battle between Western Union and the Bell Telephone Company ended in 1879. Ironically, Western Union could have taken charge of the telephone industry when one of the Bell Company's investors, Gardiner Hubbard, offered to sell the telegraph company the telephone patent in 1876 for $100,000.

Later, Western Electric was purchased by the Bell Telephone Company in 1881, creating the manufacturing arm of the AT&T (NYSE: T) Bell System monopoly.

Despite losing out to Bell on the telephone, Gray's impact on the telecom and even the electronics industries can't be overlooked.

Gray was a co-founder of Gray & Barton. Later, the company was renamed by Western Union, which owned one-third of the company Western Electric, the eventual supplier to the AT&T telephone monopoly.

Outside of telephony, Gray filed over 70 other patents during his lifetime. Among those inventions are the teleautograph, a fax-like machine that was used by banks for signing documents at a distance, and he is widely known as the father of the modern-day music synthesizer.