The railroads were primary users of electric telegraph services. The cable lines necessary to communicate via telegraph were often strung alongside railroad tracks. Use of the telegraph immediately reduced costs for the railroads. Conductors and station operators communicated when a train departed or failed to arrive on time. The telegraph made it possible for trains to avoid collisions with other trains on the track, sparing both financial loss and human lives.
Prior to the electric telegraph, stock market investors relied on company information that was weeks old to make stock purchases. The telegraph allowed investors to receive up-to-date information on stock values, especially in the commodities markets. Crop-destroying storms and pests were reported instantly to futures and options buyers in town. Increased numbers of investors were attracted to stock market investment as a result. In addition, the telegraph contributed to the development of New York and Chicago as locations for pre-eminent stock exchanges.
Grocers and butchers ordered perishable items straight from the farm according to the real-time demand of customers. The meat of slaughtered livestock, fruits and vegetables would then be shipped in a refrigerated car to the town where the order was placed. Combined with the refrigerated car, the telegraph contributed to an overall reduction in the cost of meat, particularly beef, as half the cost of meat previously included the cost of shipping a live animal, which would then be slaughtered by a butcher and sold to customers.
With the telegraph, businesses had a method of influencing and controlling satellite offices more effectively. Telegraph messages, or telegrams, could relay instant directives to managers of company branches located in other cities. As a result, businesses tended toward monopolistic practices, cornering the market. Western Union, an electric telegraph company, became the first national monopoly by buying up all failing and struggling telegraph companies around the country. Although the business edged out all competition, the cost of transmission for a telegraphic message dropped by 70 percent.