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The Western Union Company is an American financial services and communications . Its North American headquarters is in , though the postal designation of nearby
is used in its mailing address. Up until it discontinued the service in 2006, Western Union was the best-known U.S. company in the business of exchanging .
Western Union has several divisions, with products such as person-to-person money transfer, , business payments and commercial services. They offered standard "Cablegrams", as well as more cheerful products such as Candygrams, Dollygrams, and Melodygrams.
Western Union, as an industrialized , dominated the
industry in the late 19th century. It was the first communications empire and set a pattern for American-style communications businesses as they are known today.[ is ]
In 1851, the New York and Mississippi Valley Printing Telegraph Company was organized in
by , , and others, with the goal of creating one great
system with unified and efficient operations. Meanwhile,
had bought back one of his bankrupt companies and renamed it the New York & Western Union Telegraph Company. Originally fierce competitors, by 1856 both groups were finally convinced that consolidation was their only alternative for progress. The merged company was named the Western Union Telegraph Company at Cornell's insistence, and Western Union was born.
Western Union bought out smaller companies rapidly, and by 1860 its lines reached from the
to the , and from the
to the . In 1861 it opened the . In 1865 it formed the
in an attempt to link America to Europe, , into , to . (This project was abandoned in 1867.) The company enjoyed phenomenal growth during the next few years. Under the leadership of presidents
its capitalization rose from $385,700 in 1858 to $41 million in 1876. However it was top-heavy with stock issues, and faced growing competition from several firms, especially the —itself taken over by financier
in 1875.:196–201 In 1881 Gould took control of Western Union.
Wilbur Bold, a 12-year-old Western Union messenger boy, , 1911.
It introduced the first
in 1866, and a standardized time service in 1870. The next year, 1871, the company introduced its
service, based on its extensive telegraph network. In 1879, Western Union left the
business, having lost a . As the telephone replaced the telegraph, money transfer would become its primary business.
stock market index for the
(NYSE) was created in 1884, Western Union was one of the original eleven all-American companies tracked.
By 1900, Western Union operated a million miles of telegraph lines and two international .
The company continued to grow, acquiring more than 500 smaller competitors. Its monopoly power was almost complete in 1943 when it bought Postal Telegraph, Inc., its chief rival.
Former headquarters of WU, located at 60 Hudson, New York, NY, USA, in the early and middle 20th century
In 1914 Western Union offered the
in 1923 it introduced
to join its branches.
followed in 1933, intercity
in 1935, and commercial intercity
communications in 1943. In 1958, it began offering
service to customers in New York City. Western Union introduced the 'Candygram' in the 1960s, a box of chocolates accompanying a telegram featured in a commercial with the rotund . On the 1970s version of Let's Make a Deal hosted by Monty Hall Western Union Candygrams with a cash message inside were offered to contestants as a prize during a deal. In 1964, Western Union initiated a transcontinental microwave system to replace land lines.
During World War II, families of sons in the military service dreaded the Western Union "boy on his bicycle" to arrive at their home with a telegram from the
or the . The message began: The Secretary of War (for soldiers and airmen) or Secretary of Navy (for sailors and marines), regrets to inform you that [name, rank and serial number of the man in the military service] was killed in action (or missing in action).
Advertisement for Western Union "Tourate" telegram service, 1939
Western Union became the first American
to maintain its own fleet of
, starting in 1974. The fleet of satellites, called , carried communications within the Western Union company for telegram and
message data to Western Union bureaus nationwide. It also handled traffic for its
() services. The Westar '
were also leased by other companies for relaying , , , and facsimile (fax) transmissions.
In 1963 Western Union organized its international cable system properties and its right-of-way for connecting international telegraph lines into a separate company called Western Union International (WUI) which it divested that year to American Securities. In 1983 American Securities sold WUI to
which renamed it to MCI International and moved its headquarters from
In the 1970s WUI installed and leased to the U.S. Department of Defense (DOD) dedicated 50
high-speed telecommunications facilities between the continental U.S. and Hawaii, Germany and the United Kingdom to provide a test bed for the DOD's
(ARPA). This test bed provided ARPA with a proof of concept for the technology of packet switching which later became the Internet.
In 1976, Western Union partnered with .
In 1981 Western Union purchased a fifty percent interest in . It sold Airfone to
in 1986 for $39 million in cash.
Because of declining profits and mounting debts, Western Union slowly began to divest itself of telecommunications-based assets starting in the early 1980s. Because of deregulation at the time, Western Union began sending money outside the country, re-inventing itself as "The fastest way to send money worldwide" and expanding its agent locations internationally.
Example of a Western Union Telegram, 1959. Note that the message text is a continuous strip of paper which was cut and glued to the telegram form.
In 1987, Investor
acquired control of Western Union through an outside of chapter 11 process that was a complex leveraged recapitalization. The transaction was backed by a total of $900 million in
underwritten by 's group at
as part of an exchange offer. LeBow installed Robert J. Amman as President and CEO who led a complete strategic, operational and balance sheet restructuring of the company over the subsequent 6 years.
Mr. Amman executed a strategy of redirecting Western Union from being an asset-based provider of communications services, with a money transfer business as a large but less important part of the business, into being a provider of consumer-based . In so doing, Mr. Amman ran the company as two separate companies. One business consisted of the money transfer business, which was funded and operated to take advantage of the significant growth opportunity. The second unit consisted of all the non-strategic communications assets such as the
analog voice network, satellite business and undersea cable assets. In the 3-year period through 1990 Mr. Amman was supported by , also installed by Mr. LeBow, as a special advisor who oversaw the divestiture of the four non-strategic telecommunications assets for about $280 million.
The official name of the corporation was changed to
in 1991, just in time for that entity to seek bankruptcy protection as part of Mr. Amman's strategy to eliminate the overleveraged balance sheet while continuing to grow the money transfer business . The name change was taken to shield the Western Union name from being dragged through the proceedings (and the bad PR that would cause). Under the day to day leadership of Robert J. Amman and the backing of , the company's value increased dramatically through its years operating under chapter 11.
Following various restructurings that included negotiations with Carl Icahn who became a large bond holder, Mr. Amman engineered the sale of New Valley in a bankruptcy auction to
in 1994 for $1.2 billion where he became vice chairman, and a year later merged with
in a $6 billion transaction. On January 26, 2006, First Data Corporation announced plans to spin Western Union off as an independent, publicly traded company. Western Union's focus will remain money transfers. The next day, Western Union announced that it would cease offering telegram transmission and delivery, the product most associated with the company throughout its history. This was, however, not the original Western Union telegram service, but a new service of First Data under the Western U the original telegram service was sold off after New Valley Corporation's bankruptcy and now operates as .
The spin off was completed September 29, 2006 and Western Union became an independent, publicly traded company again.
Western Union telegrams were transmitted through a
message switching system. Early versions were manual telegraph systems. Later systems using
were semi-automatic, using punched
to receive, store, and retransmit messages. , Western Union's last paper tape based switching system (), was fully automatic, with automatic routing.
Western Union was a prime contractor in the
(AUTODIN) program. AUTODIN, a military application for communication, was first developed in the 1960s and became the precursor to the modern
in the 1990s. The
(DMS) replaced AUTODIN in 2000.
AUTODIN, originally named "ComLogNet", was a highly reliable service that operated at 99.99% availability, using mechanical
readers and tab machines to send and receive data over . During the peak operation of AUTODIN, the United States portion of the network handled twenty million messages a month. Western Union failed in its attempts to engineer a replacement (AUTODIN II), leading to the development of an acceptable
(the developer of the ) which became the foundation of today's Internet. AUTODIN service ceased in 2000, years after it had become obsolete.
A related innovation that came from AUTODIN was Western Union's computer based EasyLink service. This system allowed for one of the first marketable
systems for non-government users. In addition, the system allowed the same message to be sent simultaneously to multiple recipients via email, fax, mailgram, or telex services as well as allowing messages to be sent from the integrated formats. With the service, users could also perform research utilizing its InfoLink application. EasyLink Services is now its own company.
As of February 2006, the Western Union website showed this notice:
"Effective , Western Union will discontinue all Telegram and Commercial Messaging services. We regret any inconvenience this may cause you, and we thank you for your loyal patronage. If you have any questions or concerns, please contact a customer service representative."
This ended the era of telegrams which began in 1851 with the founding of the New York and Mississippi Valley Printing Telegraph Company, and which spanned 155 years of continuous service. Western Union reported that telegrams sent had fallen to a total of 20,000 a year, because of competition from other communication services such as email. Employees were informed of the decision in mid-January.
Telegram service in the United States continues to be available through
and other companies.
In May 2009, Western Union announced its intention to acquire
from Peter Gustavson. The deal closed in September 2009, with Western Union purchasing Custom House for 370 million. Its acquisition led the company to be re-branded as Western Union Business Solutions.
In January 2011, Western Union acquired 100% of Angelo Costa, a group active in money transfer and services to immigrants. Angelo Costa has a network of 7,500 points of sale in various European countries. The agreement was signed for US$200 million.
In July 2011, Western Union acquired 's Global Business Payments division for 606 million.
In October 2011, Western Union completed the acquisition of Finint S.r.l., one of Western Union's leading money transfer network agents in Europe, counting more than 10,000 subagent locations across Italy, Spain, and the United Kingdom.
A Western Union outlet in ,
Western Union's website, <, still allows users to send and receive funds to others, pay bills, or purchase gift cards.
The domain < attracted at least 8.7 million visitors annually by 2008, according to a
As the Internet became an arena for commerce at the turn of the millennium, Western Union started its online services. BidPay was renamed "Western Union Auction Payments" in 2004 before being renamed back to BidPay. BidPay ceased operations on December 31, 2005, and was purchased for US$1.8 million in March 2006 by CyberSource Corp. who announced their intention to re-launch BidPay. BidPay was later discontinued by CyberSource effective December 31, 2007.
In October 2007, Western Union announced plans to introduce a mobile money-transfer service with the , a global trade association representing more than 700 mobile operators in 218 countries and covering 2.5 billion mobile subscribers.
The proliferation of mobile phones in developed and developing economies provides a widely accessible consumer device capable of delivering mobile financial services ranging from text notifications associated with Western Union cash delivery services to phone-based remittance options. Western Union's mobile money transfer service offering will connect its core money-transfer platform to m-bank or m-wallet platforms provided by mobile operators and/or locally regulated financial institutions.
In order to send funds, a sender goes to a Western Union office and presents funds (plus fees) for "Next Day" or "Money in Minutes" service. The sender provides his or her name and address, the recipient's name, and a designated payment destination. Western Union then provides the sender a 10-digit Money Transfer Control Number (MTCN) that the sender must provide to the recipient. The recipient then proceeds to a Western Union agent office in the designated payment location, presents the 10-digit MTCN, and a photo ID. Money is then paid out to the recipient. In some locations, if a recipient lacks identification documents, the sender and receiver can set up a pre-arranged password. Funds are paid out in cash, although if payment exceeds a local maximum or cash on hand, a check is issued. Alternatively, a sender may forward funds to a recipient by using Western Union's website or by phone. In some countries, the recipient doesn’t need the MTCN number if he has sufficient identification.
Fees vary based on the sender and receiver's location, type of transfer, and whether the money is sent from a counter location or by the website.
WU phone parlors near , 2008
Along with satellite telecommunications, Western Union was also active in other forms of telecommunication services:
terrestrial microwave networks
Business communications networks such as
and TWX, which was acquired from
and renamed Telex II by Western Union
Landline-based leased voice and data communication circuits
Long distance telephone service
air-ground radiotelephone service from 1981 to 1986
Cellular phone service for a very short time in the early 1980s (the phones were made by
manufacturer )
Most of these services were discontinued by Western Union in the late 1980s due to a lack of profitability, with the company's divisions providing said services being
and sold to other companies, such as the 1988 sale of WU's satellite fleet and services to , and the sale of WU's Airfone service to
Western Union was a major shirt-sponsor of the
team from . The company still sponsors the team, but not as a shirt-sponsor. Around the world, Western Union sponsors numerous community events that help support the diaspora communities that use the global Money Transfer service.They also sponsored numerous
pay-per-view events such as the
The First Data Western Union Foundation donates money to charitable causes around the world. After the , the Foundation donated US$1,000,000 to the relief effort.
The big queue at an ATM in , .
Western Union advises its customers not to send money to someone that they have never met in person. Despite its efforts in increasing customers' awareness of the issue, Western Union is used for
by scammers.
Western Union has been required to maintain records of payout locations of the individuals who may be
the money, though this information may be obtained only through the use of a . Hence
continue to receive funds via Western Union confident in the knowledge that money lost to overseas scammers is almost always unrecoverable. For this reason, it is banned as a medium of payment through , and discouraged on other online auction websites.
reprimanded and fined Western Union EUR1.75m in May 2015 because of failures in anti money laundering practices which could have left the firm’s payment services open to being used for money laundering and/or terrorist financing saying that they were concerned that Western Union "failed to have in place sufficiently robust systems and procedures to train agents, to monitor and identify suspicious activity in respect of smaller transactions, and to maintain appropriate records" and "the splitting of payments into many separate smaller payments is a common method used to launder money. Similarly, terrorist financing is often carried out by small payment transfers"
There were allegations by that Western Union provided
with personal information.
Western Union has begun blocking transactions based on suspicion of
connections, as a part of the company's involvement with the . Currently, transfers sent from the Western Union website require telephone confirmation of the sender's identity. On occasion, the transfer will fail and Western Union's customer service will inform the sender that the transaction "does not meet our requirements". If details are requested, no information will be given other than the fact that their disclosure is forbidden. Numerous customers have reported this problem.
– Former headquarters
– The quick brown fox jumps over the lazy dog. Used by WU to test teleprinters.
— Question before the : when Western Union Money orders are supposed to
to the state if not fully redeemed, what state is to get the money?
, 1939 schooner chartered by Western Union Telegraph Company, used in film as slave ship La Amistad
– Former Headquarters
(XBRL). United States Securities and Exchange Commission. February 24, 2014.
(XBRL). United States Securities and Exchange Commission. May 1, 2014.
. United States Securities and Exchange Commission.
. Western Union 2015.
. . February .
Schmotter, James W. (1992). . Ithaca, NY: Cornell University Press 2010.
Klein, Maury (1997). The Life and Legend of Jay Gould. Baltimore: Johns Hopkins University Press. &#160;.
Renehan, Jr., Edward J. (2006). Dark Genius of Wall Street: The Misunderstood Life of Jay Gould, King of the Robber Barons. New York: Basic Books. p.&#160;263. &#160;.
, , New York&#160;: Alfred A. Knopf, 2010.
Casson, Herbert Newton (1911). . Chicago: A.C. McClurg. pp.&#160;81–84.
Phillip R. Easterlin, “Telex in New York”, Western Union Technical Review, April 1959: 47 figure 4
Bechtel, Warren.
. www.storefound.org. StoreFound 2015.
– From the Western Union website
(archived February 20, 2006). Accessed July 15, 2008
. January 2011.
. Businesswire. July 5, 2011.
. October 2011.
. authorize.net 2008.
David Derbyshire (March 3, 2007). "eBay-er Beware". National Post (Canada). p.&#160;FW5.
– Internet Crime Complaint Center
Ben T Khushwant Sachdave (October 29, 2005). "The ebay racketeers". DAILY MAIL (London). p.&#160;19. Three Romanian immigrants who conned eBay customers out of nearly Pounds 300,000 were behind bars last night. In the biggest Internet fraud of its kind, the gang fooled 3,000 bidders who they arrogantly described as 'idiots' into paying for goods that did not exist. Victims from around the world handed over sums of up to Pounds 5,000 for everything from concert tickets to motorbikes through the money transfer chain Western Union.
David Brown (December 18, 2005). "Fraudsters Targeted In New eBay Crackdown". The People. p.&#160;33. The auction giant will protect customers by BANNING the use of online money transfers. Now eBay will bring in the ban – backed by Western Union and already in force in the US – from January&#160;15&#160;in the UK. It will tell punters to use secure payment systems that verify the identity of users, and which can track both buyers' and sellers' accounts.
. The Irish Times. 19 May 2015.
. Central Bank of Ireland. 18 May 2015.
Suskind, Ron (2007), , Simon & Schuster, &#160;
– Cryptome
– The NewsLog of Flemming Funch
Sundaram, Anjan (July 6, 2006). .
Wolff, Joshua D., Western Union and the Creation of the American Corporate Order, . New York: Cambridge University Press, 2013.
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