THE NEW MARCONI CONTRACT.

Dominion, Volume 6, Issue 1833, 21 August 1913, Page 11

THE NEW MARCONI CONTRACT.

MR. SAMUEL'S STATEMENT. INCREASE IN THE COST OF WIRELESS STATIONS. MY. Herbert Samuel, the PqstmnslcrGe'neral, made an important statement in the House of Commons on July 4 in respect of the new contract with tho Marconi Company for the establishment of an Imperial series of wireless stations. Jll tones that were severely businesslike (our Parliamentary correspondent writes), Mr. Samuel described tho abandonment of tho old contract, the decision of 'tho exports that the Marconi Company alone could bo employed, and the impossibility of open tenders. Mr. Samuel explained that neither the Post Ollico nor the Admiralty could themselves erect the stations, which, maintains tho similar decision arrived) at a year ago. The creation of a special stall for the purpose of erecting tho stations would be a .speculative and expensive alternative, and tho Marconi Company must, therefore, be employed. ilr. Samuel holds that the use of the Patents Act would not obviate tho necessity of paying royalties which would havo to be fixed by tho Treasury after consulting a Commission. Moreover, the Act only applies to tho United Kingdom, and royalties would havo to bo adjudicated in detail for stations beyond tlioso shores. Undor these circumstances, the agreement is again proposed, with certain modifications. Increase in the Cost. The company cstimato that the additional cost due to the riso in tho price of materials since the agreement was signed amounts to JtlisoU a station. Mr. Samuol does not accept this figure, but admits that such extra cost, if proved, should bo made tho subject of an allowance. The company ask for ~£IOOO compensation for trouble caused through maintenance of a stall', largely unemployed, owing to tho delay in ratifying the contract. This request has been resisted by the Post Office, and on tliis point the company has given way. Tho company asks that tho now contract shall lapse unless ratified by August 31. which has been agreed to. Tho company, pointing out that money is dearer than it was, asks that payment for tho stations shall not bo deferred, as arranged last year, until all aro demonstrably working satisfactorily, but that payment shall bo made during construction on usual contractors' terms—that is, three instalments of 30 per cent., followed by a final instalment of 10 per cent. Mr. Samuel resists this proposal,, attaching tho greatest importance to the provision that payment shall bo strictly by results. But he will allow tho company 2 per cent, interest on capital so locked up until payment ■is made. Royalties Modified. Other details were crowded out by the rules of the House, but were circulated after tho Houso rose. In the original contract it was provided that royalties should be at tho rate of 10 per cent on tho gross receipts of tho stations, and that it should bo payable so long as any valid and still unexpired patents, of which the company jmd tho exclusive use, were being employed for the purpose of tho Imperial chain. Tho com,pany has now agreed to tho following alterations :

That the royalty should be payable for each station separately, and that if Marconi patents wera used in some and not in other* it was to be clear that the royalty should bo payable not in respect of tho rooeipts of tho Imperial chain, but only in respect of tho receipts of the stations where tho pateuts wero used.

That whilo tho contracts should bo for six stations, as originally arranecd, England, Ee.ypt, East Africa, South Africa, India, and tho Malay Peninsula. tho Government should at any time before tho completion of the stations in South Africa, India, and the Malay Peninsula, or of any of theso threo, have tho option of callinj; upon the Marconi Company to ceaso work upon them should it be desired to instal other apparatus. It was provided, however, that tho oompany should bo recouped for any actual expenditure thoy had incurred.

I'iie company had previously guaranteed a speed of transmission of fifty words a minute by automatic apparatus, except during periods of exceptional clcetrical disturbance of tho atmosphere, and a speed of twenty words a minute try hand-signalling apparatus at all times. They ore now in a position to guarantee a speed automatic working of 75 words a minute.