By the late nineteenth century the submarine telegraph cable industry, which had blossomed in the 1850s, had reached what historians regard as technological maturity. For a host of commercial, cultural and technical reasons, the industry seems to have become conservative in its attitude towards technological development, which is reflected in the small scale of its staff and facilities for research and development. This paper argues that the attitude of the cable industry towards research and development was less conservative and altogether more complex than historians have suggested. Focusing on the crucial case of the Eastern Telegraph Company, the largest single operator of submarine cables, it shows how the company encouraged inventive activity among outside and in-house electricians and, in 1903, established a small research laboratory where staff and outside scientific advisers pursued new methods of cable signalling and cable designs. The scale of research and development at the Eastern Telegraph Company, however, was small by comparison with that of its nearest competitor, Western Union, and dwarfed by that of large electrical manufacturers. This paper explores the reasons for this comparatively weak provision but also suggests that this was not inappropriate for a service-sector firm.