Tesla's Induction Motor

George Westinghouse, knowing of the transmission problems associated with the use of direct current, had purchased the American rights to the English/French ac transmission system in 1885. However, there was no practical ac motor available. In 1888 Tesla demonstrated the commutator-less, one-half horsepower ac motor shown here to the AIEE. Two months later, Westinghouse purchased the rights to the motor for one million dollars and royalties. Based on the increase in the consumer price index since 1888, Tesla received the equivalent of more than a half-billion (tax-free) dollars for his invention.