How was the telephone used in the beginning?

In the very early days when Graham bell had invented the telephone, the telephones were connected using point to point connection or in other words to connect each telephone to every other telephone one needed a wire. This meant if we had n telephones in the network we needed 2n-1 cables or wires. This was a near impossibility if you consider say 1000 telephones in the network which would give rise to 1999 connection. For this reason the switching offices were developed wherein all the telephones would be connected to the switching office. Connection between the caller and the cal lee would be made at the switching office if both of the them have a connection to the office or the call would be transferred to the next office. As the population increased more and more connections were required, which gave rise to the same situation as with telephones earlier(i.e more number of wires required to make the connection) which resulted in the formation of toll office. (The next higher hierarchal level) Today one can find hierarchy of upto 4 or 5 levels