Omaha daily bee., 1893-04-13
rELEPHoNE JOEER.
now tho rubiio IL Piuched by Mas1et
Monopoly.

How the rublto 4. Plucked by a Me.ts,.
Monopoly.
Telephone charges in our cities arc hirN
because the American He'll Telephone con.
pany steadily increases It's capital its royal.
ties and ITS profits, aud TO a much less degree,
because Of the expenses or profits OF IN,
local organization with which the customer
deals
The local companies are by no means
worked as charities or managed for the bcnc.
NJ Of the public, says the Philadelphia Press
quite the contrary. The Bell Telephone
company Of Philadelphia paws, and has paid
for years past, n steady ~ per cent on its
capital of $500 600 all cash MS To local
subscriptions 1t had accumulated in
lS9l after ten years, a surplus of Stil ,3g4,
and it put $il4,a5l OF this into underground
conduits and the loss incident to the change
Since the ycar ending December al 1856,
when this company began it's regular quar-
tcrly dividend Of per cent, il has jus, about
doubled its business, advancing its gross re-
ccipts, as nearly as can be made out from its
very inadequate reports, from S35O, Az in the
calendar year lSSG to SIl0,j34 in the year
ending June 30, 1891
This is very fair prosperity Dividends OF
IL per cent an addition of Sgl l05 to surplus,
and SIll ,Njl put into plant in five ycnrs on,
an original investment of $3.50 900 is Ger.
tatnly such return as would satisfy
most But this is simply nothing to the
march Of the parent company. From 1881
to 1872, a span of five years the American
Bell Telephone company has raised its CAPT
tai stock from $500, 100 to SlI,5O1,0O0, or
nearly doubled it. II has issued 5000 600
dehenture bonds and it has added Sl,6l5 1863
to its patent account In this five years.
and these the last years of its chief patent,
il has added Sll3l4O63 to the capital on
which it collects money and takes in profits
from the public. 1t has added 55 per cent To
its net earnings which have risen from 81
2l05o6 in 1887 to S3,4ll $40 in 1892, and its
dividends, which were $l.56S 36S in 1857,
were 81 ,090 in 1892, or nearly doubled.
Now the American Bell Telephone COM
pauy holds One-third the stock of the local
companies, and charges them a royalty for
the telephones into the bargain. BY this
ingenious plan every man who pays Sl2O a
year for the privilege Of saying "hcllO' first
and later using stronger language pays the
American Bell Telephone twice lie helps
To earn one-third the dividends of the local
company for stock on which no cash was
paid and by which dividends the Bell re-
Ceived 81 ,422 ,O4S in 1892 against 81 ,0l3,O III
1887, and he pays his share of the j,3O3 T53
received for rental of telephones in 1892, one
fourth more than in 1887, when 81, POD SOB was
paid.
The local company makes money, no
doubt of that; but by the time it has paid
over dividends on one-third its stock, paid
the rental of it's telephones and met the
charges OF new plant and SO on in putting Its
lines under ground. it is making great deal
less money than the large charges would ap-
pear to Indicate. BY this double arrange
ment the real offender the American Bell
Telephone company, is screened from the
public which uses its telephones, and the
real cause and source of high charges is ef
fCCtually concealed and protected.