Daily Kennebec journal. [microfilm reel] (Augusta, Me.) 1870-1975, 1925-09-15
Resume Hearing
On Phone Rates
Before P. i. Comm.

engineer of the American Telephone
and Telegraph Co., was on the wit
ness stand again Monday morning in
the rate proceedig of the New Eng
land Telephone and Telegraph Com
pany pending before the Public IT'LL
tiles Commission. Continuing his tes-
timony, Mr.. Rhodes stated that the
American Telephone and Telegraph
Company supplies the New England
TEL & Tel. Co., with all telephone
transmitters, receivers and induction
coils used by the latter'S subscribers.
1t does this as part of the service
for which the New England company
pays Az per cent of it's gross tele-
phone revenue. He stated that the
other services, which are many and
valuable, constitute assistance in en-
gineering, legal, financial and ac
counting matters. to which he had
previously referred. He showed that
it would cost the company in Maine
81 cents per station annually to pro-
vide its own instruments.
At the afternoon session before the
Commission, Edward V. Cox. assist
ant Vice. President of the American
Telephone and Telegraph Company
was the witness. He was examined
by Chares s. Pierce, general counsel
of the company. Mr.. Cox stated that
his duties relate to the supervision
of the supply service rendered to the
various associated companies of the
Bell System under the contract be-
tween the individual companies and
the Western Electric Co., which is the
manufacturing and purchasing branch
of the American Tel. & Tel. Co. He
testified that his job is to see that the
supplies are adequate and that the
prices charged for them are reason
able. He stated that in the year 1923
the New England Tel. &, Tel. Co. pur-
chased from the Western Electric Co.
telephone apparatus to the amount Of
$7,470.0O0; lead covered cable to the
amount of s1,945,000, and supplies
which the Western Electric Co., does
not manufacture to the amount of
$4,S51 900. He also stated that the
earnings Of the Western Electric Co,
in 1924 amounted to tx per cent on
the book cost of that companys pro-
perty.
Mr.. Cox outlined in detail the ad-
vantages which accrue to the New
England Tel. & Tel. Co., through the
purchase of its apparatus and sup
plies from the Western Electric Co,
and stated that as a result of the
contract the New England Co., &C
quires the best apparatus as to types
and quality at the lowest possible
prices. due to the fact that the Wes-
tern Electric Co., manufactures and
purchases enormous quantities of
goods for the entire Bell System. He
also emphasized the fact that the
Western Electric contract permitted
the New England Telephone and
Telegraph Co., to eliminate it's own
purchasing and warehousing organi-
cations. thereby effecting great econ
omy and enabling the New England
Co., to obtain from the Western Tiec-
trio warehouses the necessary sup
plies to meet it's everyday needs and
for emergency purposes. Mr.. Cox re-
ferred to the sleet storm of 1921 and
stated that the Western Electric Co.,
met the New England Company's
need for supplies and apparatus,
which enabled the New England Co.,
to quickly restore it's service. He
stated that the Western Electric Co.
maintains 81 distributing houses in
different parts Of the United States,
in which 1t keeps on hand ready for
immediate delivery to any part of the
Bell System s15,000,000 worth of sup
plies, and that at the principal manu-
featuring center Of the Western Elec-
trio Co, at Hawthorne, ILL.,, S25,O00.-
600 worth of supplies are ready for
immediate shipment to meet the
needs of emergencies which may arise
due to storms or other catastrophes.
Mr.. Cox will continue his testimony
today.