Early in the year 1845 a corporate organization was effected for the extension of the telegraph from Baltimore to Philadelphia and New York, under the name of the Magnetic Telegraph Company, for which a special act of incorporation was obtained from the Legislature of the State of Maryland.  Nearly all of the capital of this company was subscribed by Washington people.  Baltimore and Philadelphia furnished only a few hundred dollars, while New York contributed nothing.  Slow progress was made toward the construction of the line on account of the difficulty of obtaining the right of way either upon railways or highways, and it was not until January, 1846, that the line was completed to the west side of the Hudson River, which formed an impassable barrier to further progress for a considerable period.

No method of insulation had yet been devised that would permit the operation of an electric conductor under water, and it was doubted whether a wire could be maintained for a span sufficient to cross the river overhead.  Finally however high masts were erected on the Palisades near Fort Lee, and on the heights at Fort Washington on the New York side, and a steel wire was suspended upon them.  This plan was successful, except that occasionally the wire was broken by an extraordinary burden of sleet in the winter season.  This method of crossing the lower Hudson was continued for more than ten years, when it was superseded by submarine cables.

During the year 1846 incorporated companies were formed, under which telegraph lines were extended from New York to Boston, Buffalo, and Pittsburg, and within the next three years nearly every important town in the United States and Canada, from St. Louis and New Orleans to Montreal and Halifax, was brought into telegraphic communication.  Thus, after fifteen years of struggle with all the pains of poverty, often lacking even the common necessaries of life, Professor Morse and his faithful colaborers had the supreme satisfaction, in 1847, of knowing and realizing that the telegraph system had finally achieved, not only scientific success, for this had been proven years before, but that financial success, ample and complete, had come to pay them richly for all the dark days and wearisome years through which they had passed.

Once generally established, the telegraph won its way to popular appreciation very rapidly.  It was in harmony with the spirit of the age, and it was not long before every town of any considerable importance regarded telegraphic facilities as an indispensable necessity.  The small cost soon induced the construction of rival lines, regardless of the rights of the patentees, and within a very few years unwise competition began to bring many lines to a condition of bankruptcy.  The weaker concerns soon passed through the sheriff’s hands and found purchasers only at an extreme sacrifice, at the bidding of the more provident and conservative proprietors of competing lines.  Instead of inducing a more prudent course, these disastrous results only served to feed the spirit of rivalry, and general insolvency seemed to threaten the permanent prosperity of the telegraph business, in consequence of the wild and reckless competition which appeared to be inherent in its nature.