The Montgomery advertiser., 1903-10-04
A FLAT FAILURE
OWNERSHIP OF
 TELEPHONES IN ENGLAND.
Found to Be Excessively Expensive. Even the Telegraph Business Loses Money for the
 Government.

The backward condition of the tele- phone industry of England has been c hindrance to commerce, source of an- noyance to private communication the subject of Investigation by parliament and a topic of endless discussion and controversy by those interested in both sides of the problem of municipal own ership. The advocates of municipal trad ing and of State appropriation of public utilities have vociferously maintained that the cause of this lack of enterprise may be traced to the fact that until re- gently the telephone service was wholly in the hands of a private company. On the other hand, the friends of the com pany declare with equal force and strong array of facts that the real cause of the trouble comes from the unrea- sonable interference and unjust demands of the British government, which have made 1t impossible for private capital and enterprise to push ahead, apply the latest inventions and increase the ser- vice by reduction of price and extension alike of public and private exchanges. A glance at the history of the telephone in England strongly indicates that the gov ernment has played a fast and loose game with those who have undertaken to establish 1t, with the result that its pro- gross has been retarded because the com pany never knew quite where 1t stood. In the first place. the learned electric savant of the postofflce declared that it was in full operation, that the telephone was an ingenious toy, but of no value for commercial purposes. This same off, ficial is now vociferousiy denouncing the Marconi wireless elegraphy as of no commercial value, and the postoffice de- partment is placing an obstacle in the way of it's utilization by refusing to build two miles of telegraph wire and estab- fish all-nfght service as Poldhu. In this way. off1cialdom is doing what 1t can to retard invention and stife enterprise. Government Losses on Telegraph. In the case of the telephone. however. when 1t was finally established between
 such large centers of population as Liv- erpool and Manchester, and began to make inroads into the postal telegraph revenues, the postofice department be- came alarmed and interfered. It was de- creed subsequently by the courts that the telephone was a telegraph. and that tele- phones worked for public benefit came
 under the telegraph act. and that, there- fore, the government had a monopoly of | them. This was naturally severe blow to the National Telephone Company and one calculated seriously to impede its en- terprise. As the government was not pre- pared or not sufficiently sure of the financial success of the telephone to take 1t over bodily, as 1t had done the tele- graph, 1t licensed the National Telephone Company to work under the telegraph act at a 10 per cent. royalty on the gross
 receipts. The licenses were restricted be- cause they were contingent upon the
 consent of local authorities who could place obstacles in the way and prevent the laying of wires and otherwise ob- struct the systems installation.
 For some years the telephone people
 struggled along. having little faith in the final outcome, until in 1892 the govern
 ment of the day came to a general ar engagement in reference to the telephone
 business of the country. The British gov
 ernment took over the trunk wires which connect large towns and placed them under the postmaster general. The busi- ness inside towns, which in England is generally called exchange business" was left in the hands of private com panies. This dual arrangement had It's
 disadvantages and, as those who under
 stand the business will realize, it's in- conveniences. However, the telephone
 ccompany could do nothing. but go ahead
 along the line mapped out by the gov
 ernment. Having no control over the en-
 tire system, being more or less hampered
 by municipalities in the matter of laying
 wires, and being compelled to pay over
 a large royalty to the government, the
 
 ditionAl capital
 The government and the company seem to have got along fairly well, giving an indifferent service for a rather high price, until the municipal traders, looking around for new fields to conquer, took up the matter The telepraph act of 1899 gives the municipalities the right to estab- lish and work local systems within their own area in competition not with the government trunk lines, but with the tele- phone company. Now, as everybody knows, the telephone service is not one which lends itself to competition, because it is obviously inconvenient for a tele- phone subscriber to find that people with
 whom he wishes to speak are not on his system, but on the system of some other company. This, with the government ab- sorbing the trunk lines and municipalities reaching out after the local business, has discouraged the company which original ly undertook the equalization Of the tele- phone in England and some of the of- ficers openly say that rather than still
 further complcate and obstruct business
 by municipal trading 1t would be wiser
 for the government to take 1t all over and run 1t with the telegraph as State monopoly.
 There arc several reasons why this plan
 is just now not agreeable to the British
 Government. In the first place. public sentiment is murmuring against increas- ing State undertakings. The govern
 ment has made a mess of the telegraph
 business, which does not even pay. Up