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Pony Express and the telegraph

The federal government provided subsidies for the development of mail and freight delivery, and by 1856, Congress authorized road improvements and an overland mail service to California. The new commercial wagon trains service primarily hauled freight. In 1858 John Butterfield (1801–1869) established a stage service that went from Saint Louis to San Francisco in 24 days along a southern route. This route was abandoned in 1861 after Texas joined the Confederacy, in favor of stagecoach services established via Fort Laramie and Salt Lake City, a 24-day journey, with Wells Fargo & Co. as the foremost provider (initially using the old "Butterfield" name).

William Russell, hoping to get a government contract for more rapid mail delivery service, started the Pony Express in 1860, cutting delivery time to ten days. He set up over 150 stations about 15 miles (24 km) apart.

In 1861, Congress passed the Land-Grant Telegraph Act which financed the construction of Western Union's transcontinental telegraph lines. Hiram Sibley, Western Union's head, negotiated exclusive agreements with railroads to run telegraph lines along their right-of-way. Eight years before the transcontinental railroad opened, the first transcontinental telegraph linked Omaha, Nebraska, to San Francisco on October 24, 1861. The Pony Express ended in just 18 months because it could not compete with the telegraph.