GENERAL ELECTRIC COMPANY

The General Electric Company (GE) is the fifth largest business in the United States. Headquartered in Fairfield, Connecticut, GE was valued at more than $350 billion in the late 1990s. The company's operations span many different areas, including manufacturing, technology, network and cable television, financial services, leasing, loan and information services, electricity distribution hardware, plastics and silicone production, medical diagnostic equipment, and utility, industrial, and marine power systems. GE does business in over 100 countries and maintains approximately 250 plants worldwide.

Established in 1892, GE was the result of a merger between the Thomson-Houston Company and the Edison General Electric Company. Charles Coffin was GE's first president, and inventor Thomas Edison (1847–1931) served as a director until 1894. Lightbulbs, elevators, trolleys, electric motors, generators, and locomotives were among GE's earliest products. In 1900 GE built a research laboratory in New York. The laboratory contributed to a number of breakthroughs, including X-ray tubes, high-speed steam public utilities, photoelectric relay (to control the flow of electricity), gas-filled incandescent lamps, and electrically propelled ships.

GE soon began diversifying its business. In 1918 the company purchased Hughes Electric Heating Company, the maker of an electric cooking range, and Pacific Electric Heating Company, the manufacturer of America's then most widely used appliance, the iron. The following year it teamed with Westinghouse Electric and American Telegraph and Telephone (AT&T) to found the Radio Corporation of America (RCA). In 1922 it debuted one of the country's first radio stations, WGY, in Schenectady, New York. Over the next 20 years GE introduced a series of appliances that quickly became fixtures in the American home. Refrigerators, toasters, food mixers, fans, air conditioners, vacuum cleaners, and washing machines were perennial money makers for the company.

Other advances included GE's 1940 development of frequency modulation (FM) radio transmission, considered a vast improvement over the existing amplitude modulation (AM) mode. GE's innovation proved to be an asset to Allied forces during World War II (1939–1945). The company produced more than 50 different types of radar for the armed services, and more than 1,500 marine power plants for the Navy. America's first jet airplane, the Bell XP-59, and its largest battleship, the North Carolina, were both powered by GE parts and ingenuity. In the late 1940s GE initiated a project to harness nuclear power for civilian and military use. This project bore fruit in 1955, when the Navy unveiled its first nuclear submarine powered by a GE reactor. Two years later the Atomic Energy Commission granted GE a license to operate the first privately owned nuclear reactor. By the end of the 1950s GE was boasting record profits.

GE's dominance in so many areas raised a number of anti-trust concerns. Both competitors and the federal government made efforts to ensure that GE did not hold a monopoly in any one industry. Between 1911 and 1967 GE was named as a defendant in 65 anti-trust lawsuits and formal complaints. Some of the legal actions resolved themselves without great cost, as when GE sold its interest in RCA in 1930 to loosen its grip on the fledgling recording industry. Other lawsuits were more injurious to the company. For example, in 1961 the U.S. Department of Justice indicted GE for fixing prices of electrical equipment. GE was fined nearly $500,000 and required to pay damages of approximately $50 million. Three GE managers faced jail sentences and other executives were forced to quit.

Despite its recurring anti-trust problems, GE continued to enjoy success, tripling its earnings during the 1970s. In 1976 GE made what was then the largest corporate purchase in U.S. history, paying $2.2 billion for Utah International, a major mining company and producer of natural gas and oil. The 1980s marked a period of transition for the company. In 1981 John (Jack) Welch took over as president with the goal of making GE number one or number two in every field of operation. He decentralized operations and sold $10 billion worth of the company's less profitable business, including its air-conditioning, housewares, and semiconductor sectors.

GE used the proceeds from these sales to purchase Employers Reinsurance, a financial services group, in 1984; RCA and the National Broadcast Company (NBC) in 1986; CGR medical equipment in 1987; and investment bankers Kidder, Peabody in 1990. The Employers Reinsurance acquisition made the company's financial services division, known as GE Capital, enormously profitable. The NBC acquisition paid dividends in the 1990s, when it aired a number of critically acclaimed and popular primetime programs on network television and debuted CNBC and MSNBC on cable.

GE's fortune and profitability continued to climb in the late 1990s. In 1997 the company reported revenues of $90.8 million. That same year GE became the first company in the world with a market value exceeding $200 billion. Since surpassed by the Microsoft Corporation's $479 billion market value, GE held on to second place with a market value of approximately $375 billion as of April 1999.

Regardless of its profit margin in any particular year, GE has a strong reputation for community involvement. In 1994 GE received the President's Volunteer Action Award for its charitable work. A year later its College Bound program for underprivileged youth received national recognition. In 1996 the company and its employees donated $75 million to philanthropic organizations around the world. At the end of the twentieth century GE announced that during 1998 its employees had logged 1.3 million volunteer hours doing various acts of good will in communities where the company is present.

GENERAL ELECTRIC COMPANY

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