TELEPHONE CHARGES

Dominion, Volume 13, Issue 166, 9 April 1920, Page 8

TELEPHONE CHARGES

MEASURED RATE AND FLAT RATE CASE FOR THE FORMER SYSTEM A CHANGE TO IT PROBABLE i At a meeting held in Wellington South i on Wednesday evening complaint was made against the wide divergenco in rates • for. telephones within the metropolitan ; area of Wellington. One speaker stated that his annual charge was «Ell (for a small business), whilst for a big business in town that had a hundred times as many calls the charge would probably ■ bo ,£6 per annum. This matter was referred by a reiiorter to the Post nnd Telegraph authorities yesterday. At tho same time inquiry was made about the reduction in rates that was to .follow the installation of the automatic system. To deal with the latter point first, the reporter was told that a- reduction had indeed been promised. The promise still held good, but it referred to the time when the new system should have been fully installed; and at the present time the "installation was by no means complete. As a matter of fact, the telephone service at present consisted of three svsfems—the Western. Electric and tho Strowger systems (two kinds of automatic). and the manual system. No change could very well be made until the whole 6,vsteni was automatic, and it would be automatic, the authorities hoped, before verv long. Had it not been for the war, the system would have been fully installed long ago, and the promised reduction in charges would liavo been operating. The Measured Rate. At present the whole question of telephone charges was under the consideration of tho Department, and it wns most probable that as the outcome of these deliberations the system of charging would be charged from a flat rate to a measured: that is to say, there would bo an annual charge to cover the. cost of installation and upkeep—say from £3 to M —and over and above that users would be charsed on the -number of calls made, which calls would be registered by a mechanical device attached to. tho telephone. That was the system adopted generally - throughout the United States and Europe, and really was the only fair one. It was not right. that one man making ten calls a day should have to pay as much as. or more than, one making 600 calls a day. The. system, too, wns one that acted ns'n check upon the many futile, unreasonable, and silly calls made on an unlimited call sj'stem. Then, too, the measured rnte system of payment mnde for more subscribers, for a suburban resident who now probably paid nearly twice as much as a city business -house, would find the* adjustment in rates going his way. The small user would be encouraged. Australian Views.

Some years ago. the Commonwealth Parliament set up a commission to go into the matter of telephone* charges. The commission consisted of a committee of accountant' and the Chief Electrical Engineer, and some of tho findings in the report arc most interesting. At one stage the report said: It has been stated in tho Press that under a measured service system the telephone would practically go out of use. The contrary has been the experience in every other part of the world. The rate of growth of the system has in every instance increased from the date the measured service was instituted. Under the flat-rate system the number of telephones pnr 100 of population is considerably lower than under a measured service system. This has been the experience not pnly of America, but of England and such countries of Europe as have adopted the measured service basis of charging. As a measured service system leads to a larger extension of.the telephone service,' it follows that it;must ei.able the service to be placed' at the disposal of manv who, under a fait-rate system, would have to go vHhout; that is to say. under the flate rate not'only are the co?ts of the service ; inequitably distributed, but the growth of the system is retarded, and the true aim of any Government Department, service of the people, that is in tlfis case -of as great a number of the. community as possible, is frustrated. Lord Stanley's Opinion.

The opinion of Lord Stanley (formerly Postinnstcr-General of Great Britain) was contained in the following article vbich appeared in the London "Timw":—

"Lord Stanley desires me to noint out that there are 'two systems of cWges in London—the unlimited service system and the message-rate system. The unlimited service system. in Lord Stanley's opinion, is unsuitable for a modern telephone exchange service, and owes its continuance to the force of custom and the demands of a limited number of large users. The London Exchange system is constantly increasing both in the number of subscribers and exchanges. The growth of tlie system has greatly increased its value to subscribers, but the cost of construction and maintenance lias increased in even greater proportion, and this must necessarily be the case, in every growing exchange system. It is clear, therefore, that no fixed rate for unlimited use'can adequately correspond with such conditions. If fixed with regard to the cost of the service for a' large exchange system, it must necessarily be prohibitive for small users, and if fixed on the basis of the cost of a small exchange system it must soon become unremunerative. In Lord Stanley's view the proper method of charges is that which was recommended l>y the Select Committee of 1898, under which the payments of the subscribers are fixed in proportion to their use. The measured-rate swstem offered by the Post Office fulfils this requirement, and its advantages have been proved by its nccentance by more than 90 per w-nt. of the subscribers to the London Post Office system. In the United States, where during the last few years the telephone exchange system has been largely improved and developed, methods of this kind have ben widely adopted, and have proved nil effective means of increasing the number of subscribers."

Change of Control,

At the nrcsent time the various telephone exchanges are under the direct control of the Superintendent of Telegraphs for the district. Now that with the coming of the automatic system the telephone business has become a highly technical one. a change of control is about to be instituted by placing the telephone services under tho control of the Chief Electrical Engineer, which will mean that the engineer of each district will be responsible for the telephone system, instead of the Superintendents of Telegraphs,