Evening star., 1939-10-16
F. {. {. Head Seeks
Data for Proposed
Telegraph Merger
Definite Program Due
10 Be Formulated at
Conference Wednesday
BY WILLIAM J. WHEATLEY,


Conference Wednesday
BY WILLIAM J. WHEATLEY.
Intent on speeding up the program
to perfect the communication sys-
tenn of the country in accord with
plans to bolster the national defense,
Chairman James Lawrence Fly of
the Federal Communications Com
mission has taken steps to centralize
all data available in various gov
ernmental units bearing on the need
and effect of a proposed merger of
the two large telegraph companies.
The need for a naturalization of
the wire companies has been pointed
out by the commission, and Chair
man Fly has held conferences on the
matter with officials of the two
companies, President Roosevelt, and
Senator Wheeler, Democrat, of Mon
tana, who is chairman of the Senate
Committee on Interstate Commerce
and heads the special committee
merger resolution.
There are so many angles to the
problem that various Government
departments and bureaus have data
which will be required by the Senate
committee to complete its inquiry.
Aid of the executive branch will be
needed in the investigation, mas
much as the committee has only
5000 with which to do the job.
Chairman Fly has conferred with
officials of some of the Government
agencies involved, including officials
from the Labor Department from
whom data might be sought as to
the possible effect of q merger on
unemployment.
:. Conference Set Wednesday.
Another conference is scheduled
at the Office of Chairman Fly We'd
nesday, when it is expected that a
definite program will be formulated,
which will include the loan of per-
sonnel to the communication group
to scollect and coordinate the data
for the Senate committee.
Mr.. Fly said no definite plan for
q merger had been formulated by
the commission, but something may
develop out of the conferences and
the data which it is hoped will be
available The Justice Department
has been studying the matter for a
long time and just before the Sem
ate authorized its investigation was
working on plan of bringing about
q merger through the medium of
consent decree. However, 1t is un-
derstood this idea has been dropped
for the time being in difference to
the program of Senator Wheeler's
committee. AS a part. Of its pro-
gram the Communications Commis-
sion has taken on its legal staff
Robert M. Cooper as an assistant to
General Counsel William j. Demp-
sey. Mr.. Cooper has been engaged
in the Justice Department for some
time on communications litigation
and is reported to have proposed
the merger by consent decree.
The Communications Commission
Act does not give that body a13-
thority to effect mergers, but some
months ago plan was recommend
ed to Congress that such authority
seemed desirable at this time in
order to put the telegraph system
on a nationalized basis which would
make it an effective medium in the
national defense plans.
A. T. & T. Facilities Considered.
In formula ting a plan for GEN.
traization of wire telegraph facili-
ties, consideration has been given
to including in the new setup the
telegraph facilities now operated by
the American Telephone & Tele-
graph Co. 1t was said that while
the Justice Department was con-
sidering the problem the matter was
discussed with A. T. & T. officials
and they were represented as being
favorable to it, if sufficiently COM
pensated.
Chairman Fly, however, indicated
that one of the greatest obstacles
In connection with a merger plan
would be the labor problem, or
rather unemployment. One of the
purposes of the merger would be to
effect economy of operation, and
this. he pointed out, would involve
closing many Offices, where each
of the companies has stations.
sometimes in the same city, and even
in large Office buildings just across
the corridor.
1t was asserted that telegraphy
has never really been a national
service in the United States. At
present. it was pointed out, West
ern Union has Offices in approx
rnately 1884 places, and Postal
Telegraph in 3,425 places. 1t was
asserted that if Implications were
eliminated and the number OF
cities served by smaller telegraph
companies taken into account, it
Is probable that fewer than 10000
places in the United States have
telegraph service. In contrast there
are approximately 47,640 post Offices
and $4,000 places served by toll tele-
phones. Competition in domestic
telegraphy, it was held, tends to
be competition for telegraph busi-
ness in those cities where most of
the business originates and where
1t can be handled at profit. The
commission said it is not COM
petition in making telegraphy a
national service by placing Offices
in communities which have never
had telegraph service.
Al