St. Paul daily globe. [volume] (Saint Paul, Minn.) 1884-1896, 1886-02-15
THE GIANT MONOPOLY.
How the Bell Telephone Anaconda Enfolds
the Whole OOuntry-0nly Ton
Years of Age.
A Fairy Tale of Modern Finance-Pay-
ing Five Dividends in
One Year.
How Men Have Made Enormous For.
tunes on stock Seven Times
Watered.
The Importance of the Suit About TO
to be Instituted by the
Government.

Electric Telephone company, which seems
TO have obtained such wide ramifcations
among the statesmen at Washington, has
directed public attention to telephone mat
tiers in general and especially to that giant
monopoly, the American Bell Telephone
company. Never in the history of Amer
lea, nor in the history of any other country,
has a corporation grown to such dimensions
in so short time as the American Bell
Telephone company. Never before has an
inventor so Immediately grown enormously
rich from the proceeds Of an invention as
Prof. Alexander Graham Bell. Morse took
took out his first patent on his electric tele-
graph in 1910, but il was four years before
the first message was passed over the first
line ever laid, which was between Balti-
more and Washington, and it has taken
the Western Union Telegraph company and
the Baltimore & Ohio Telegraph company
all these intervening years to grow up into
their present great proportions. Morse
himself was but indifferently rewarded; and
probably died without having a conception
of the extent to which his invention would
be employed. and the importance of 1t as a
commercial and financial factor Of the age.
Robert Fulton never dreamed of how steam
ships weuld cover the sea. and Stephenson
tent of the railway tracks that now cover
the earth with a steel network We are
amazed it is true at the sudden and gigantic
growth Of the railroads, the steamships the
cables and the telegraph lines, but none of
them came to much under quarter of a
century.
THE STORY OF ALADDIN'S LAMP RETOLD.
The genera public never heard OF such a
thing as the transmission of speech over
wires till ten years ago. True, some ex-
periments had been made. Bourseuile in
France and Refs in Germany had worked
on the idea some years before. but nothing
OF practical character came from their
efforts, and the world went on in ignorance
OF their labors. Bells application for a
patent was received at the patent Office,
Washington, Feb. Ii, 1876, and it is re-
markable fact. which adds to the romantic
interest, to say nothing of the legal phases
OF the story, that an application for patent
on speaking telephone was received from
Prof. Elisha Gray of Chicago ON the same
day, but little later. The patent was
granted 10 Bell on the ground of the differ
ence in time, and not because of any differ
enee in the merit of the claims. Thus. by
what would ordinarily be considered a
tritiing incident, was the Bell Telephone
company given at least temporary foot
ing, of which it has not failed to take adj
vantage, making Bell very rich man. and
leaving Gray to nurse all his life, perhaps,
the regret that he had not been pricked up
to one days greater haste in sending away
his application.
Bell took his telephone to the Centennial
exposition, where it was seen and expert
mented with by thousands of visitors, who
never suspected that it would come to more
than an ingenious plaything. 1t was two
years after the Centennial that the first
telephone exchanges under the Bell patent
were established, though a company had
been organized in 1878. 1t was not till
1879 that the new method of communication
was firmly established as a commercial and
social necessity, and from that year dates
the marvellous growth and success of the
Bell company. Its capital stock on the
3lst of December, 1884, was S24, 600. 600,
and an application was made last year to
the Massachusetts, legislature for an in
crease to $50, 000.0 600. which is half the
amount of the entire capital stock of the
Western Union Telegraph company. The
receipts for rentals for the fiscal year
and the net earnings for the COM
pany for the same time were
S1.710, 900. The grst dividend was not de-
clared till Jan. 1. 1881, when $500, 500 was
paid to stockholders on 73, 500 shares, or
per cent. One more dividend of the same
amount was declared that year. three divi-
dends of that amount were declared In 1882,
two dividends of the same amount were
paid in 1888. and two of S2SS, 063 the same
year, five dividends of S2sS. 063 each were
paid in 1884. and one of the same amount
was paid Jan. Is, 1885, and several have
been paid since. Up TO the 18th of Janu-
airy. 1855, the total dividends paid to stock
holders amounted to about 81, 900. 900. The
original investors in Bell telephone stock
paid from $40 to $40 per share. Since then
the stock has been increased or ''watered"
seven times and the shares are worth S15O
each, so that an original holder has now
eight shares for every one that he first held,
and what he paid say $50 for Is now worth
81, 200.
AN INTERESTING EXPENSE ACCOUNT.
On the LIST of January. 1885. the Bell COM
pany controlled in the United States and
territories 772 exchanges, 107, 40 circuits;
10l, 1874 miles of wire, gave service TO 5, 16S
employees, and had 1874, 900 subscribers. Its
payroll last year averaged about SO. 900 a
month. or about S120. 600 year. The en-
ploycs are nearly all girls, who receive very
small salaries. The expenses are very light,
the original cost OF property small and the
income sure. AS monopoly of the modern
school il has no rival and what it will at
tain TO in another ten years, unless checked
in its progress, no one would undertake to
fOretell. The character of its property.
when it comes to a valuation i'm dollars and
cents, Is very well illustrated by
the Insignificant amount it has
paid 10 the various states for
taxes Up to the beginning OF 1885 its total
outlay for taxes in all the United States had
reached only S129,OO The amount paid
for taxes in New York for 1884 was S24. Sc.
The amount paid in Missouri the same year
was S54.76, In Massachusetts, where the
capital stock Is taxed. the amount paid in
1884 was S24,41O The amount paid in all
the United States outside of Massachusetts
since 1881 up To the beginning of 1855 was
less than SIS. a company that has
combined salary and tax expense of about
$3.50, 600 year, with an income of 50. 005,-
600 year. is fine illustration of the mod
ern scheme of money-making.
MEN WHO HAVE MADE FORTUNES.
A number of men have grown very rich
through small investments made in Bell tele-
phone stock i've or six years ago. Prof. !
Bell, who makes his home in Washington,
is supposed 10 be worth 81. 900, 900. He
was originally Massachusetts man, and
when he applied for his first patent was a
teacher OF languages in a school for deaf
and dumb. 1t was through his Boston
aequaintanceship that the first company
was organized. W. ii. Forbes of Boston, is
the president. he Is said TO be worth from
SIS, 900. 900 to IS. 600. 900, which comfortable
sum has accumulated on an original invest
ment of S64. 600. Other Massachusetts, men
who have made fortunes the same way are
Gardner &, Hubbard of Boston, said to be
worth sS,Oo0,OO0. &. p. Bowditch of