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The United States and Chile experienced diplomatic tensions that were heightened by the rapid movement of messages through the recently built international telegraph network. Government officials in Washington and Santiago engaged in heated telegraphic exchanges while newspapers from New York to San Francisco emphasized this crisis and published telegraphed reports on military preparations and the possibility of war. Critics of the press pointed out the exaggerations and falsehoods in these reports and warned of the perils in making crucial decisions in the new era of unprecedented speed in communications. Officials in Washington debated the growing crisis. Congressman James Blount deplored “the confusion provoked by instantaneous discussion.” Taking advantage of the confusion, President Benjamin Harrison exploited the quick movement of cabled messages and abandoned standard diplomatic practice to impose a deadline in the negotiations with the Chilean government. Harrison’s aggressive use of international communications forced the Chilean government to make prompt concessions.

The British dominated the world's submarine cable business over the second half of the nineteenth century, but they encountered significant challenges in the 1880s and 1890s—especially from James Scrymser, an upstart entrepreneur from New York. Scrymser exploited a strategic gap in the cable system in the Western Hemisphere and became locked in a confrontation along the west coast of South America with John Pender, the leading British cable magnate. Scrymser gained the upper hand in Chile by outmaneuvering Pender and used this victory to expand his operations with the telegraph network that linked South America, North America, and Europe.