Evening star., 1948-08-15
Rate Increases Boost
U. 5. Telephone Bill
S14O,0O0,0O0 a. Year
BY the Associated Press

about everything else since the war
and is due to go up still more.
The $1,000, 900 900 Bell System
worlds biggest utility, has beer
granted since the war rate increases
totaling $140,000,0O0 a year, it /:
shown in an Associated Press sur.
vey made across the country.
The Bell System, which operates
four -fifths Of the Nations $4,000 00(
telephones, says its costs are ur
just like everybody else's. 1t has
been getting most Of the increases
it has asked, but not without Q
struggle in some cases..
These are the first general tele.
phone rate increases in two decades
or more, and they have stirred ur
hot opposition in several States
Utility commissions have made deer
slashes in amounts asked and have
turned their fire on some of the
operation methods of the American
Telephone & Telegraph Co. and
its subsidiaries that comprise the
Bell System.
Granted in SO States.
The increases already granted
affect SO States. In addition, Bel
companies have applications pend
ing for some $64,0oo000 year In
rate boosts in 16 States, including
seven in which no increases have
vat heep Granted
The countrys $500 independent
companies, most of them small
also have been getting increases
and also have additional applica-
tions pending. D.;
The boosts granted SO far gener-
ally have been greater on business
telephones and long distance calls
within the States than on home
service.
In some localities, home rates
we're left unchanged despite general
increases, but most were boosted
IS or so cents a month and some
as much as one dollar
Business telephone rates gener-
ally went up 25 cents to $3.50 a
month over old rates, with 81 in
creases fairly common. A few were
boosted as much as So and $3.25 a
month, but these generally were
accounted for In part by other fac
tors such as increased areas in
which nontoll calls could be made
Interstate Rates Unchanged.
No increases have been granted
or asked in interstate long distance
rates, controlled by the Federal
Communications Commission. 1r
fact, the FEC estimates interstate
rates have been reduced nearly
$13l 900 900 a year since 1885.
With rate increases for Bell com.
panies granted or pending in 4;
States, it is expected the list even.
tually will be Joined by the othel
five-Delaware, Nevada, New York
North Dakota and Pennsylvania.
A. T. & T. President Leroy A
Wilson recently told stockholder!
that other applications will be made
In the near future" They will bt
needed, he said, to meet rising cost.
and keep the Bell System in
sound financial position to continus
its huge expansion program, ane
maintain high standards OF service
to present customers.
In nine of the States in which in
creases were granted-including tW'
with no. State regulation-and II
the District of Columbia, Bell com
panies got the full increases the!
asked. In many others there wa!
only minor opposition and mino
trimming
Attacked in Some States.
But in some States the increase!
have been attacked by State ane
municipal officials and private in
terests as being too high. The mos
common arguments against botf
Bell and independents have beer
that lesser increases would provide
fair returns on company investments
and that, in areas not yet converted
to dial operation. improved service
should be given in advance OF ratt
increases.
Considerable commission fire ha!
been directed against certain of the
financial practices of the giant Bel
System, and several commissions cu'
substantial amounts from Bell com.
pany applications.
On the other hand, Bell COM
panies have been generally success.
full in the courts in cases in which
they contended commission cuts o.
disallowances were confiscatory
Commission rulings involving more
than $13,000,000 year in rate in
creases were upset in courts ir
Georgia, Alabama, Mississippi, Okla
homa, New Hampshire and Ten
neSsee.
Commission criticism of Bell COM
panies has centered largely on three
points:
/. The license fee of one and one
half per cent which A. T. and T
receives on gross receipts of It's tele-
phone subsidiaries.
g. 4llC oIdlludlo " supply IOlltI dSt
under which Bell companies buy the
major portion of their equipment
from Western Electric, the A. T
and T.'s manufacturing subsidiary
3. The rates A. T. and T. and the
subsidiary companies pay for new
money needed to finance their ex-
pansion and improvement programs
Fee Revision Demanded.
A special telephone committee OF
the National Association of State
Utility Regulatory Commissions has
asked A. T. and T. to revise the pei
cent license fee system. 1t says
practically all State commissions
have severely criticized" the per.
centage system of charges for man.
agement services, advice anc
research.
The Bell System says the license
fee plan results in new methods