AC and the induction motor
In late 1886 Tesla met Alfred S. Brown, a Western Union superintendent, and New York attorney Charles F. Peck. The two men were experienced in setting up companies and promoting inventions and patents for financial gain.[49] Based on Tesla's patents and other ideas they agreed to back him financially and handle his patents. Together in April 1887 they formed the Tesla Electric Company with an agreement that profits from generated patents would go 1/3 to Tesla, 1/3 to Peck and Brown, and 1/3 to fund development.[49] They set up a laboratory for Tesla at 89 Liberty Street in Manhattan where he worked on improving and developing new types of electric motors, generators and other devices.
One of the things Tesla developed at that laboratory in 1887 was an induction motor that ran on alternating current, a power system format that was starting to be built in Europe and the US because of its advantages in long distance high voltage transmission. The motor used polyphasecurrent which generated a rotating magnetic field to turn the motor (a principle Tesla claimed to have conceived of in 1882).[50][51][52] This innovative electric motor, patented in May 1888, was a simple self-starting design that did not need a commutator, thus avoiding sparking and the high maintenance of constantly servicing and replacing mechanical brushes.[53][54]
In 1888, the editor of Electrical World magazine, Thomas Commerford Martin (a friend and publicist), arranged for Tesla to demonstrate his alternating current system, including his induction motor, at the American Institute of Electrical Engineers (now IEEE).[55] Engineers working for the Westinghouse Electric & Manufacturing Company reported to George Westinghouse that Tesla had a viable AC motor and related power system—something to which Westinghouse had been trying to secure patents. Westinghouse looked into getting a patent on a similar commutatorless rotating magnetic field based induction motor presented in a paper in March 1888 by the Italian physicist Galileo Ferraris but decided Tesla's patent would probably control the market.[56][57]
In July 1888, Brown and Peck negotiated a licensing deal with George Westinghouse for Tesla's polyphase induction motor and transformer designs for $60,000 in cash and stock and a royalty of $2.50 per AC horsepower produced by each motor. Westinghouse also hired Tesla for one year for the large fee of $2,000 ($52,500 in today's dollars[58]) per month to be a consultant at the Westinghouse Electric & Manufacturing Company'sPittsburgh labs.[59]
During that year, Tesla worked in Pittsburgh, helping to create an alternating current system to power the city's streetcars. He found the time there frustrating because of conflicts between him and the other Westinghouse engineers over how best to implement AC power. Between them, they settled on a 60-cycle AC current system Tesla proposed (to match the working frequency of Tesla's motor), although they soon found that, since Tesla's induction motor could only run at a constant speed, it would not work for street cars. They ended up using a DC traction motorinstead.[60][61]
War of Currents
Tesla's demonstration of his induction motor and Westinghouse's subsequent licensing of the patent, both in 1888, put Tesla firmly on the "AC" side of the so-called "War of Currents,"[62] an electrical distribution battle being waged between Thomas Edison and George Westinghouse that had been simmering since Westinghouse's first AC system in 1886 and had reached the point of all out warfare by 1888.[63][64][65] This started out as a competition between rival lighting systems with Edison holding all the patents for DC and the incandescent light and Westinghouse using his own patented AC system to power arc lights as well as incandescent lamps of a slightly different design to get around the Edison patent.[66] The acquisition of a feasible AC motor gave Westinghouse a key patent in building a completely integrated AC system, but the financial strain of buying up patents and hiring the engineers needed to build it meant development of Tesla's motor had to be put on hold for a while.[67] The competition resulted in Edison Machine Works pursuing AC development in 1890 and by 1892 Thomas Edison was no longer in control of his own company, which was consolidated into the conglomerate General Electric and converting to an AC delivery system at that point.
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