Evening star., 1934-03-13
TELEPHONE RATES
RAPED BY DILL
Washington Senator Backs
Communications Commits
sion in Forum Talk.

rates and Objectionable radio adver-
tising practices were attacked by Sem
ator c. c. Dill, Democrat. of Wash
ington, last night in an address in
which he advocated the establishment
of Federal Communications Com
mission.
The Senator's plea for enactment
Of administration approved legislation
to create such a commission was de-
livered in the National Radio Forum,
arranged by The Washington Star,
and broadcast over a coast to coast
network of the National Broadcasting
Co. 1t was heard locally through sta
ton WRC.
Assails High Rates.
Senator Dill cited savings made by
telephone and telegraph companies
during recent years through the use
of new inventions, but asserted that
rates for their use had continued 'as
high as ever" He also pointed out
the failure of State commissions to
regulate rates successfully.
while the price of almost every
thing else has come down during the
last four years" he said, telephone
rates have continued as high as ever"
adio-telegraph and radio-tele-
phone rates. Senator Dill said, also
are high. but he added that through
competition of these new services
cable rates have been forced down.
ward.
Radio Body Lacks Power.
Turning to radio broadcasting and
advertising, he asserted that the
Federal Radio Commission is with
out sufficient authority to regulate
"rates for advertising or broadcast
ing or rates Of any kind"
TT is my opinion, however, that
unless radio station managers elimi-
nate some of the Objectionable ad-
vertiSing practices now prevalent, the
protests and demands of radio lis
teners will eventually force Congress
to give the commission complete con-
troll over both rates and advertising +"
Senator Dill sketched the history
of communications in this country
and outlined the provisions of the
proposed measure to set up a Federal
Communications Commission.
Text OF Dills Address.
The text Of Senator Dills address
follows
We want communications COM
mission in this country, because we
want some effective regulation of the
telephone and telegraph business
We have never had that. With TO-
100000 telephones carrying more than
27,000,000.000 separate telephone con-
versations each year, and the tele-
graph and cable companies carrying
200,000000 written messages each
year. the cost of telephone and tele-
graph service has become extremely
important.
For years our State commissions
have tried to regulate telephone rates,
but they have failed. Why? SIM
ply because no State commission can
possibly regulate the holding compa-
nies. subsidiary and affiliated compa-
nies that own and operate the tele-
phone, telegraph and cable business
of this country.
Some of these companies engage
only in State business. Others engage
only in interstate business. Still
others engage in both State and in
terstate business. Yet practically all
of the large companies are intercon-
nected by stock ownership, service
contracts and interlocking direct0-
rates.
When a State commission has un-
earthed sufficient facts to justify it
in issuing an order reducing tele-
phone rates. the companies generally
take the case into the. Federal court
before judges who are appointed for
life and who are never required to
submit their records to the voters.
After years Of litigation the COM
missions order Is generally set aside.
Cut Employees and Pay.
What then has been the result?
Simply this: While the price of al
most everything else has gone down
during the last four years, telephone
rates have continued as high as ever.
There are many reasons why tele-
phone rates should have come down
the past few years. The telephone
companies have installed the dial
system so almost everybody who uses
q telephone must be his own tele-
phone operator. Reports show that
80 per cent Of telephones in this
country are dial telephones. That
cuts down expenses. They have
dropped many employees and cut the
wages of those they didn't drop.
That cut off some more expenses.
BY means of certain inventions they
now send several telephone conver-
sations and telegraph messages over
single wire at the same time, in
stead of only one conversation or one
message, as in the past. Thus they
multiply the amount of business they
formerly did over the same wires
without adding to the expense.
But regardless of all these reduc-
tions In expenses, they have not cut
local telephone rates, which apply to
more than 90 per cent of the tele-
phone business. These facts explain
In part at least why the telephone
monopoly and its subsidiaries have
been able to pay regular dividends
every year of the hardtime period.
The American Telephone &, Telegraph
Co., the parent company of this vast
monopoly. paid 50 per share every
year of this hard-times period. while
few years ago 1t paid only $3.50
and So per share.
What is true Of the rates in the
telephone business is true of the rates
in the telegraph business also, but
to q somewhat less degree. Indeed.
I am told that in some instances the
rates on telegraph messages have
actually increased.
AS to the regulation Of radio tele-
phone and telegraph rates. there
never has been any such regulation.
The radio telephone and the radio
telegraph are so new and so little
used that only a comparatively few
people know about them. Radio tele-
phone rates to foreign countries are
necessarily quite high, because so few
people use the interoceanic telephone
as yet. While radio telegraph rates
are still high, the competition of the
radio telegraph with the cables has
brought the only reduction in cable