The early Western Electric theater systems were of one-way design consisting of large re-entrant type exponential horns.
The Western Electric 555 driver was used with these large assemblies. Frequency response was band limited, and the range
covered was probably no more than 100 Hz to about 5,000 Hz. Later on, Western Electric added a high-frequency unit as
well as an array of low-frequency woofers to augment these systems. They used Jensen 18" woofers in open-back enclosures
to supplement low frequencies and a device known as the Bostwick tweeter to extend the upper range. These additions to the
basic one-way system appeared in 1931.

The sound department at Metro-Goldwyn-Mayer Studios was not happy with the augmented Western Electric systems.
Specifically, they objected to the twelve-foot path length in the mid-range and its concomitant time delay relative to the
low- frequency and high-frequency sections. The RCA systems of the same era were not even as good as the three-way
Western Electric systems; they used a single eight-inch cone transducer mounted on a straight horn.

In 1933, Douglas Shearer, head of the MGM sound department, got the idea of building his own system. He enlisted the aid
of John Hilliard, a young electrical engineer, and Robert Stephens, a design draftsman, who later was to found the Stephens
Trusonic Company. John F. Blackburn, a physics graduate of the California Institute of Technology, suggested to Hilliard that
MGM enlist the aid of James B. Lansing to manufacture components for the MGM system. The so-called Shearer horn system
was introduced in 1936 and won an award from the Academy of Motion Picture Arts and Sciences for technical excellence.
It was a large two-way system that had much in common with an earlier system that had been designed for auditory perspective
experiments at Bell Laboratories. The Shearer system used high-frequency multicellular horns driven by a driver with an annular
slit phasing plug. The low-frequency section of this system consisted of a large W-horn with fifteen-inch woofers operating in an
open back configuration. Both woofers and high-frequency drivers had three inch voice coils. Flat wire was used in the high-
frequency driver and round wire in the woofer voice coils.

There is no question that the Shearer MGM system set new standards for sound in the motion picture theater. The basic design
was later adopted by many manufacturers around the world; both RCA and Western Electric adopted the basic approach for their
later systems.

Western Electric objected to the use of annular slits in the high-frequency phasing plug the Lansing company had designed.
Western Electric had patented this design, and as a way around this problem John Blackburn and Lansing devised a radial slit
phasing plug, which they incorporated in the 284 driver. Later, Blackburn found a way around the Western Electric annular slit
patent by noting in the literature that Bell and Tainter, in the early years of the century, had established prior art in the area of
acoustical phonograph design.

Another important system that Lansing designed for the industry was the Iconic, a small two-way system using a fifteen-inch
low-frequency loudspeaker and a small high-frequency driver, the 801 (later known in its Alnico form as the Altec 802), driving
a small multicellular horn. The Iconic system gained wide popularity throughout the motion picture industry as a monitor
loudspeaker; many two-way monitor systems of today are only minor improvements over this early system.

The United States government, taking note that Western Electric held a virtual monopoly in motion picture sound recording,
forced that company to divest itself of all holdings in the sound recording business. Western Electric signed a consent decree
in 1938 and sold the holdings of Electrical Research Products, Incorporated, to a group of engineers who were working for
them at the time. The name, Altec, was coined for this occasion: Altec, a contraction of All Technical. The principals of this
new company were George Carrington and E. L. Conrow. Their new company was called Altec Service Corporation and
maintained contracts with theater chains around the country for system maintenance work. The Altec Service Corporation
went about its business for two years without a source of new stock or parts. They used existing stocks of ERPI products
where required, but their main business was service.

It became apparent to Carrington and Conrow that they would have to develop a source for new manufactured items if they
were to be a viable force in the business on a long-term basis. In 1939, Ken Decker, Lansing's business partner and a reserve
officer with the United States Army Air Force, was killed on maneuvers when the airplane he was piloting crashed. Without
Decker, Lansing's business suffered, and it became apparent in 1941 that the sale of the company was the only way to keep
it afloat. On 4 December 1941, the Altec Service Corporation bought the Lansing Manufacturing Company. They were reputed
to have paid a price of $50,000 for the acquisition, and there were nineteen employees at the Lansing Manufacturing Company
at that time. Lansing assumed the title of Vice-President of Engineering in the new Altec Lansing Corporation. Western Electric
agreed to license the Altec Lansing Corporation to manufacture any and all of the proprietary designs that were covered by the
consent decree. Royalties were never charged by Western Electric for items manufactured.