The Barre daily times. (Barre, Vt.) 1897-1959, 1913-10-15
EXPLAINS coNTRAc%. RELATIONS.
New England Co. Official Continues His
Testimony.

Vice President +. X. Hall of the New
England company is continuing his tes.
timony before the Vermont public serv-
ice commission at Montpelier on the
proposed reduction Of rates.
Referring to tie development of the
New England company, Mr.. Hall said II
had never been the policy of the New
England company to build competitive
exchanges and seek to divide business
with existing companies. There was NJ
difference of opinien between this com
pany and the American Bell company
which owns 5S per cent OF the New Eng
land. In many states the laws absolute
ly prohibit the building of such com
petitive exchanges.
The next proposition in occupied ter
ritory is to purchase and consolidate,
and the third is the arrangement of a
traffic contract
Purchase is not always possible and
traffic contracts are more frequently en-
tered into These contracts are the same
with subsidiary as with other companies.
Aside from the four actual subsidiary
companies, the New England holds stock
in the Heath company, which bought out
the New England; the White Mountain,
operating mostly in New Hampshire, and
the Granville company, where the minor
ity interests of the New England and
New York combined would give control.
Mr. Hall explained the contract rela
tions with other companies The old
contracts were based on the rental of
instruments, but it soon became ap-
parent that the element OF service was
the more important one to be consid-
cred. Originally the exclusive use of
the Bell eompany's instruments in GER
tain territory was specified. But with
the changing of ideas and the expiration
OF patents, this form Of contract became
obsolete and began to be abolished in
1910.
A bad feature Of the old contract was
the 'other line" charge, by which five
cents extra toll WAS charged on mes
sage over the lines of another company
though this was never used by the New
England for its own benefit.
There was, too, an extra charge of two
cents for delivery and a switching charge
of one cent per message, for the benefit
of the company where the message was
received. Commissions were allowed on
incoming and outgoing business, which
an extra amount of record
keeping. At the present time under the
new contract, the percentage is reck
oned on the revenue collected, and that
rate of percentage is different in diff
ferent companies, varying with local con
ditions.
The New England has endeavored TO
induce the other companies to accept the
new contract, which has increased the
revenue OF the Ia out of 33 companies
which have adopted it $4,000 a year.
The new contract was drawn in the in-
terests of the New England the inde-
pendent companies and the public.
These contracts having been adopted,
the companies become part of the New
England system and it becomes desirable
to standardixe the service as far as pos.
sible, and the New England endeavors
to assist them in every way possible.
One method of assistance is the pureAas,
ing contract, by means of which they
purchase their material through the New
England. This is optional and not COM
pulsory. II they accept it, the New Eng
land buys for them any material and
charges a commission of two per cent
except on goods OF the Western Electric
This insures them standard
and inspected material, and gives them
he opportunity to get practically whole |
sale rates on small orders
In 1912 the Champlain Valley company |
paid the New England S57.s4 in two
per cent commissions; the Franklin com.
oany, Sl03l6; Vermont company, $780,
81; Passiumpsic, SS6414, this being |
argely due to new construction and an
,Id contract covering all purchases; and
. connecting companies, SIP.
Subsidiary companies pay one per cent
II their gross receipts for services of |
.xperts and officers OF the New England |
This is not regarded as adequate com
,ensation, but as recognition of the
ervice rendered The legal and auditing
departments Of the New England com
,auy are at the service OF the subsidia.
les, as well as the engineering depart
nent with no charge therefor beyond
his one per cent.