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The act of picking up the handset of a telephone causes a load to be put on the telephone line, so that the DC voltage on the line drops below from the approximately 45 volts present when the phone is disconnected. The black box consisted of a large capacitor which was inserted in series with the telephone, thereby blocking DC current but allowing AC current (i.e., ringing signal and also audio signal) to pass. When the black box was switched into the telephone line, the handset could be picked up without the telephone system knowing and starting the billing process.
In other words, the box fooled the phone company into thinking no one had answered at the receiving end, and therefore billing was never started on the call. Participating in a "black box" call meant talking between rings, since the phone company would continue to send rings (AC current) through the line which was heard as a loud buzzing noise. Few people build or use "Black Boxes" anymore, given that the cost of long-distance telephone calls has come down dramatically since the 1970s.