The New York herald. [volume] (New York [N.Y.]) 1840-1920, 1873-06-08
Minister Sohenck Reports to the
State Department.
OycFchafgeS Divided Between the Anglo-Ameri-
can and Western Union Companies.
GRINDING" CONTRACT.
Double Rates Collected in London for
Inland American Messages.
A Timely Expose Of the
IMPOSITION.

WASHINGTON, June Z, 1873.
The following letter from Minister schenck TO
the Secretary OF State has just been made public,
and, it is said in official circles, will lead to spir-
tied controversy on the subject OF extoruon by
telegraph companies generally.
LEGATION OF THE UNITED SrATE5.l
LONDON, April 49, 1878.
SIR have been thinking for some time OF
writing 10 you in relation TO the charges made on
kilograms sent to the United States by the Anglo
American Telegraph Company. That company
have an arrangement with the Western Union Tel
egraph Company, IN our country through which .
systematic imposition is practised which ought to
be exposed | bring ii to your attention because
communications transmitted by ocean cable on
government business are subjected to the same
overcharges as are the messages OF individuals,
and the public ana private persons are equally
concerned in having what is done known. with
view to some correction OF the wrong. ! discov-
cred something OF what | am about to explain
three or four months ago, and since then have
been making inquiries which have ELECTED the fol-
lowing as Ibeieve true statement OF the case:-
THE AN6Lo-AMERIcAN AND WESTERN UNION CON
TRACT.
These two companies have some contract be-
tween them by which 1t is agreed and arranged
that messages sent from England by the Anglo
American TO all points in the United States shall
be received and transmitted by the Western Union
to their destinations. Thus the intsrior land
lines OF the latter company are made continue
tions OF the cable on the American side OF the
Atlantic. This is proper enough and a convenience
to every one as well az to the contracting parties
It gives TO the Western Union monopoly OF bust
ness coming through the cable 20 America, and
naturally for that monopoly they agree to pay
something. Accordingly the contract binds the
western Union to allow tine Anglo American to re-
tain certain portion-beng. believe, one-third
OF what is charged for transmission over the wires
in the United states.
The Anglo-American Company have tariff OF
prices The charge Tor message from London TO
New York, or points east OF New York, is four sh-
llngs English money per word. After this month
it is understood they have promised reduction to
three shillings word.
prices. The charge, now IS ron New York to
Washington for the first ten words forty
cents. and three cents for each succeeding
word; from New York to Chicago for
the first ten words 81. ana seven cents Tor each
csso s. 81 md ass
each word beyond ten. and so IN proportion TO
Every word sent by the cable is charged for, in
Guiding date, address, and signature. ON the land
lines OF the Western Union within The United
States there Is no charge made Tor date, address
BUT now OBSERVE THE PRACTICE
under the contract before referred to between
the British and American companies. message
is sent by the cable from London 10 Washington,
Chicago or San Francisco. The Office here demands
and collects for each word four shillings, which
pays for transmission to New York. ana also
three pence more for each word TO
Washington, nine pence more for each word
TO Chicago, and fifteen pence more for each word
To san Francisco. This, with exchange and the
present difference between gold and United states
beyond New York, more than double the proper
charge OF the Western Union Company. and Is so
far an overclarge to be divided between the con-
panies who are the parties to il.
DOUBLING THE CHARGES
When the charges imposed for transmission over
the wires west OF New York are double the regular
tarin prices the American company can well AFFORD
to allow the cable company One-third or the re-
ceps for that portion Of the service performed by
If the charge were only double the account
would stand thus The Western Union being
a ar l.
lected from them was but 81, they would leave
sxty-six and twothird cents with the British
company and yet receive 81 33ls for their share,
beng thirty three and onethird cents in excess or
their regular and legitimate charge at home. But
the case is IN come particulars much worse than
this
LET US ILLUSTRATE
by surprising message OF 100 words sent from
London 10 Washington. Ten OF these words may
be supposed to constitute the date address and
names. The cable company would require to be
land line between New York and WASH
ington three pence on each Of the whole
100 words. This would amount TO 81 IS, which
is equal to SO 90. But the regular published charge
Tor such message by the Western Union would be
for the date address, names-ten words-nothing:
ing eighty words at taree cents. 81 40; 100
words. 81 So Thus there wonid be.extorted
for the service in the United states an
the SO 90 being divided would give tue British
company the equivalent OF 81 80 and leave the
American company Tor their share "a "a, which ~
still 81 "a beyond their legitimate charge at nome.
IN THE CASE or SHORTER MESS AGES.
where the address, date and names bear larger
proportion to the text the proportional oycrcharge
would be greater For message. for in
stance or twenty words there would be col
lected here, for the line from New York
TO Washington five sbilings, equal TO
81 SO In United States currency instead OF
forty cents. which would be the charge at home.
In such case the Western Union pocket for their
share, for service performed by them nnety-three
cents, being much more than twice their whole
proper charge. And it must be remembered that
large proportion OF kilograms sent across the
ocean have text OF but ten words or less.
This may dealing with an inconsideraoe
matter, but considered III the aggregate ana COM
putting the percentage OF nnjusfnable charges IL
Is no small thing, affecting the cost OF sending
intelligence between the two countries. so FAR as
the government Of the United states Is concerned,
il must have made large difference during the
past year.
/ have no means OF knowing whether messages
coming from Washington or other points IN the
United States To he transmitted by the cable 20
England are subjected to the same or similar over
charges or not. NY calculations arc based on 100
for exchange and liz Tor gold. which has been Tor
some time q air average.
submit this exposure To you Tor such use as you
NAV deem IL proper 70 make OF the information. 1
have the honor to be, sir very respectfully, your
obedlent servant, ROBERT &. SCHENCk.
To Hon. HAMILTON FISH, Secretary OF state, wash
ington.. d. G.
SOUTH AMERICA.