Salt Lake evening Democrat. [volume] (Salt Lake City, Utah) 1885-1887, 1886-02-20
GOOD STOCK TO OWN.
.,: ilYGt .litt $40 1T-TTicft IIirT .t5f 10
81 made by the Bell TeIeDhone
mOmOpOlX . ~" i@T7i afIl-
SATURDAY

| ia mil.
The New York Times saws. Tba 800
would shed no tears if the Bell telephone
patents should be declared null and ua;a
Inc monopoly that has been establishe1
upon these patents by the American 'Rsil
Telephone company has few friends az.
eept those whose friendship has been
pougnG ana PAID Tor. For many reasons
II mas become obnoxious to the public
1t demands and collects from the peonla
enormous prices for the use Of telephona
instruments. The company has testifiaS
tliat the cost of a set Of these instrn.
menus , transmitter and a receiyarli
de ei to its inspecting department IL
only S3.42. For the use of these two in.
strunents it charges to a local conmnany
an annual rent of $l4.' The rent in this
city is said toibe $15.. March 20. 1881
the parent company had 500 ,S26s trans,
mitters and receivers in use. and IFS rel
ceipts from rent for the preceding year
had been 81 ,969,442., BY the company's
own admission, the cost of these instrn-
ments was only 1864 900, and the value
OF Its telephones for the calendar. wear
1884 was entered in its statement OF as
sets at only $55S,379. Still, upon this in
vestment OF less than $500, 1000 it de-
manded and received from the local tsex
changes" an annual rent of nearly 80
000,0O0. ia51J3 9a lCt ~ mi ,iF-'
Here is an enormous annual profit Of
$50 per cent. which the Bell companv az
acts from the local exchanges. These ex-
changes must take another profit from
the subscriber. Let us see how much
this profit is. About one year ago d per-
son thoroughly familiar with the tele-
phone business estimated the cost of wire.
instruments, exchange plant, etc. for an
exchange of I, 700 subscribers in this city
at $364 900 a year, and the expenses for
salaries, repairs, ETC., at $4,000 a wear.
On the other hand i the receipts for the
year from 4, 900 subscribers, at an average
annual payment of $175, would be $780,
0oO, SO that in one year the entire plant
would be paid for, the running expenses
met and a surplus of $256,S00 laid aside
for stockholders: These figures may in
dlcate the size OF the profit taken by the
local exchange from the subscriber. br79
What percentage OF the capital paid in
cash the dividends issued by the Bell COM
pany represent it is difficult to ascertain.
An official statement presented to the
Massachusetts, Legislature whenthe com
pany was asking permission to initiate its
capital from $40 100000 to $50, 900, 900:
shows that only $4,000 was paid into
the treasures of the three Companies
that preceded the Bell company and were
merged into it. After 5000, 100 in stock
had been issued, the company stated
that So ,102 ,001 had~been paid in cash and
that $1,000, 900 had been paid in stock to
the National company for property valued
by that company at only $S50,000 The
Boston Globe, and other papers have de-
clared that the stock has been watered
seven times, or by giving to holders for
each original share seven new ones, so
that the value OF the shares, which was
at that time very great, has been diluted
until the profits do not appear to exceed
II per cent. But ii it be true that the
total amount OF cash invested did not ex-
coed 81 100000, the size of the dividend
will appear, for the net earnings
of the company in the year end
ing March /, 1885, were $1,71O,S 1892,
to say nothing of the dividends from
stock in local companies to the face val
lie of over $40 100000 held by the parent
COMPANY. tT.t.f t... -..tat " $50 |