International Bell Telephone Company

The International Bell Telephone Company was also responsible for the introduction of the telephone into Norway, and Sweden. In 1881, exchanges were established in Stockholm, Gothenburg, and Malmö.

IBTC established Sweden's first telephone company, Stockholms Bell Telefonaktiebolag, formed with the assistance of three former Swedish PTT superintendents named Lybeck, Bratt and Recin.

The new company established their first exchange in the Skandinaviska Kreditaktiebolag Building on Västerlånggatan Street in Stockholm, originally utilizing equipment designed by Alexander Graham Bell and his assistant Thomas Watson, and imported from Bell's supplier in Boston. The first Swedish phones, which had signal coils, ringers and Blake microphones, were available as desk or wall models, connecting to Gilliland type switchboards.

When Bell's Swedish phone exchange formally opened in Stockholm on 1 September 1880, it had 121 subscribers, increasing to 218 later in the year, with the majority of its users belonging to government, business and upper-class homes. The Swedish subsidiary soon opened more exchanges in the Södermalm and Norrmalm sections of the capital within its first year, operating between 9:00 a.m. and 10:00 p.m. daily, but in May 1883 moved to around-the-clock operations, charging subscribers between 160 and 280 Swedish kronor (SEKs) per year depending on their locations within Stockholm (less expensive) or outside of the city proper (more expensive). Bell's fee structure was not notably expensive, as rates were higher in most countries at the time and only lower in a few others.

After 1883 the Bell subsidiary was forced to reduce its fees due to competition from another newly formed phone company, although it was also able to increase its subscriber base. It later had to restrict its operations to the Östermalm section of the city, where it started a new network for private subscribers with lower fees using a different rate plan with a lower number permitted calls per month (its initial rate structure provided unlimited calling). In 1898 the Bell subsidiary contracted with its competitor, SAT, allowing it to operate their facilities, thereby increasing its subscriber base to about 7,000 homes and businesses. Due to government intervention and other reasons, the Bell subsidiaries were eventually legislated out of Sweden and Norway in favour of national firms. Stockholms Bell Telefonaktiebolag ceased its telephone operations completely in 1908, having acquired 15,285 subscribers by that time, in a regulatory environment which had previously permitted unrestricted telephone business competition.

The Bell Telephone Manufacturing Company (BTMC) was founded on 26 April 1882 as the principal manufacturing business to assist International Bell with its growth throughout Europe, where many countries had nationalistic trade policies favouring domestic suppliers. BTMC was owned 45% by the American Bell Telephone Company, and 55% by Bell's major U.S. supplier, Western Electric, of which Bell was also a majority stakeholder. Western Electric, a U.S. company formed during the era of the telegraph, became American Bell's sole telephone supplier the same year. In a share sale to Western Electric, American Bell later disposed of its ownership of BTMC in 1890 to concentrate on telephone system operations, but since American Bell had been Western Electric's majority shareholder since 1881 it maintained an indirect ownership of IBTC.

The IBTC was created for "...the production, sale, purchase and leasing of equipment for telephony and telegraphy and everything directly or indirectly related to electricity" Later, as demand for services bloomed, the Bell Telephone Company had insufficient operating funds to quickly increase the telephone exchange network, resulting in Western Electric buying out all 45% of the shares held by Bell in 1890.

Ezra Gilliland of Western Electric helped establish the manufacturing arm, at which point a young university educated, multilingual American, Francis R. Welles, took over its leadership, with the title of "Administrateur Delegue". Francis Raymond Welles (b. Athens, Pa., August 18, 1854 – d. Vernet-Les-Bains, France, December 14, 1936), graduated the University of Rochester with an Accelerated bachelor's degree (A.B.) in 1875, and a year later started work as secretary to Enos M. Barton, a co-founder of Western Electric. Barton had earlier sent him to Australia and New Zealand to help with operations there, and Welles was then transferred to Brussels. Welles would lead the overseas BTMC company for the next 30 years assisted by Louis De Groof, a Belgian authorised agent.

IBTC started up subsidiary manufacturing plants in major cities throughout all of Europe, since nationalistic policies favoured local manufacturers. In the year after its founding BTMC employed 35 people, and its workshops were accommodated within a small plant at No. 4 Boudewijnstraat, Antwerp. Its factory was completely rebuilt after a fire in 1882, and by 1885, the Bell Antwerp facility had completed its conversion from importing telephones and switchboards from the U.S., to local manufacturing, with production more than doubling annually as BTMC began to supply their other divisions throughout Europe. By 1900, BTMC was also its new parent's (AT&T) main supplier of telephone systems to Asia, the Middle East and South America, and the facility had increased to a staff of 700 operating from a greatly expanded plant.

At the very close of 1899, the American Bell Telephone Company was acquired, for business purposes, by its own subsidiary, the American Telephone & Telegraph Company (AT&T), which then became the head of the monolithic and monopolistic Bell System.

Significant criticism of AT&T (a monopoly) had emerged in the United States that domestic telephone system rates were higher than they needed to be, and that AT&T was using those revenues to subsidize its European operations. Due to that reason and others, and also due to the U.S. Government's regulatory intervention, AT&T president Walter Gifford divested almost all international interests held by the Bell System in 1925, with the exceptions of the Bell Telephone Company of Canada and Northern Electric.

The European division and its subsidiaries were sold to the International Telephone & Telegraph Company, at the start of that company's meteoric rise in the international telecommunications industry.