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Originally appearing in Volume V26, Page 557 of the 1911 Encyclopedia Britannica.
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LINE MYAFS low resistance telephones. The transmitter on long and high resistance lines worked better by joining, in the manner shown in fig. 7, the microphone, a battery and the primary of an induction coil in a local circuit, and putting the line in circuit with the secondary of the induction coil, which acted as the transmitter. The resistance of the microphone can thus be made a large fraction of the total resistance of the circuit in which it is placed; hence by using considerable currents, small variations in its resistance can be made to induce somewhat powerful currents in the line wire. The requisite energy is derived from the battery. In the earliest telephone switchboards the lines were connected to vertical conducting strips, across which were placed a series of similar horizontal strips in such a manner that any horizontal could be connected to any line strip by the insertion of a plug into holes provided in the strips for the purpose. Any two lines could be connected together by connecting both to the same horizontal strip. The next step of importance was the introduction of what was termed the " Standard board." This board was equipped with spring-jacks and annunciators (calling-drops) for the subscribers' lines, and with flexible cords terminating in plugs for connecting purposes. The spring-jack used was a form of switch with two contact springs which pressed against each other, one being connected to the subscriber's line wire and the other to the annunciator, which was also earthed. When a plug was inserted in the spring-jack the connexion between the springs was opened, disconnecting the calling-drop from the line. Each connecting-cord circuit had associated with it a clearing-out drop connected between the cord and earth and a key by means of which the operator's speaking and ringing apparatus could be brought into circuit. When a subscriber called (by turning the handle of his magneto-generator), the shutter of the annunciator associated with his line dropped. This attracted the attention of the attendant, who in response to the call inserted a plug into the spring-jack and connected the speaking apparatus to the circuit by means of the key. Then, having obtained particulars of the subscriber's requirement, the operator connected the second plug to the spring-jack of the wanted subscriber, whom she rang up. When the conversation was finished either of the subscribers could release the shutter of the clearing-out drop by turning his generator handle, and theoperator thus notified of the fact removed the plugs and discontinued the connexion. The single-wire earthed circuits used in the early days of telephony were subject to serious disturbances from the induction caused by currents in neighbouring telegraph and electric light wires, and from the varying potential of the earth due to natural or artificial causes. The introduction of electric tramways caused an enormous increase in disturbances of this classi It was early recognized that a complete metallic circuit would obviate troubles from varying earth potentials, and that if the outgoing and in-coming branches of the circuit were parallel and kept, by trans-position spiralling, or otherwise, at equal average distances from the disturbing wire, induction effects would likewise be removed. These advantages led to the gradual supersession of the single-wire system until at the present day the all-metallic system is employed almost universally. Since the time when the system first became prominent all switchboards have been arranged for metallic circuits. Though many types of manually operated switchboards have been brought into use, differing from each other in respect of circuit and working arrangements, yet each of them may be placed in one or other of three main classes according as the system of working is magneto, call-wire, or common battery. The fundamental principle of the magneto system has been described in connexion with the " Standard board." 1n a large exchange a number of operators are necessary to attend to calls. Several single switchboards like that described may be employed, each devoted to a certain section of the sub-scribers, and placed in care of an operator. In these circumstances, when, as frequently will be the case, the person calling desires to be put in communication with a subscriber who belongs to another section, connexions must be established in the office between the two sections; this necessitates additional switchboard arrangements, and also increases the time required to put subscribers in communication with one another. The difficulty was obviated by the introduction of the " multiple switchboard." This board is built up in sections of one or more operators' positions each. All the subscribers' lines are connected in order to jacks on the first two or three or four operators' positions, and these connexions are repeated or " multipled " upon each succeeding similar group of positions. Each subscriber's circuit is further connected to another spring-jack directly associated with the calling-drop. These springacks, known as answering jacks, are distributed along the switch-board, a certain number being terminated upon each position and placed in the care of the operator assigned to that position. Hence this operator, when signalled in the ordinary way, can put any one of these subscribers in connexion with any subscriber whatever, without the necessity of calling upon another operator to make connexions. Two methods of multipling " have been much used. In the arrangement first introduced the line wire is connected in series through the various spring-jacks, the circuit finally passing through the answering jack to the calling-drop. This arrangement is liable to give trouble, as disconnexions may arise in the spring-jacks in consequence of the failures of the springs to make contact. Operating mistakes also cause interruptions to conversations, as it is possible, by the insertion of a plug in a multiple jack, to disconnect the circuit between two talking subscribers. To overcome these difficulties the " branching multiple " was introduced. In this arrangement, instead of the circuit being made through the jacks in series, each jack is connected to an independent branch from the main circuit. With the " branching multiple " the " self-restoring drop " was introduced. This apparatus has two coils, one of which, connected across the line, is provided for the purpose of projecting the shutter, while the other is intended for its restoration and is joined in a local circuit arranged to be closed when a plug is inserted in any one of the associated jacks. It is necessary that the operators working at a multiple board shall be able to ascertain without entering a subscriber's circuit whether the circuit be disengaged. This requirement is usually met by connecting a third or " test " wire to each of the jacks associated with a subscriber's line, and by making the circuit arrangements such that this wire is either disconnected or at earth potential when the line is not in use, and at some potential above or below that of the earth, when the circuit is engaged. With a proper arrangement of the operator's speaking set it is possible, by touching the socket of a jack with the tip of a peg or a special " test " thimble, to determine whether the circuit connected to the jack is in use. Both the series and the branching methods of multipling are recognized at the present time as standard methods, although the former is only employed in comparatively small exchanges. The magneto system itself is dying out. There are still many magneto exchanges in existence, but when new exchanges are erected only the very smallest are equipped for magneto working, that system having succumbed to the common battery one in the case of all equipments of moderate and large dimensions. The " call-wire " system has been used to some extent, but it is now obsolete. The feature of the system was the provision of special service circuits, termed call-wires, for purposes of communication ay cat between the subscribers and the exchange operators. Each sub- causing the reproduction of the speech in the latter's receiver. scriber was given the exclusive use of a circuit as in other systems, The Stone system, compared with that of Hayes, possesses the and shared a call-wire with a number of other sub- scribers. Each telephone set was equipped with EacHnree c a special key or switch by means of which the telephone could be transferred from an exclusive line to the call-wire at will. A subscriber desiring a connexion pressed the key and communicated his own number and that of the wanted subscriber to the operator in attendance on the call-wire. Then, when the connexion was made, the originating subscriber rang up the other. At the close of a conversation the originating subscriber again entered the call-wire and requested the operator to take down the connexion. The call-wires were From the Post Office Electrical Engineers' Journal. usually equipped with drops in order that the FIG. io.—Dean Common Battery System. exchange might be called at night when the operators were not listening continuously. I disadvantage that one of the conditions affecting the supply of One of the greatest advances made in the development of the current to any particular subscriber's circuit is the resistance of the art of telephony was the introduction of the " common battery relay system." This advance did not merely remove the primary o batteries from the subscribers' stations; it removed also theJ EXCHANGE magneto-generator, and at the same time it modified consider-ably the conditions governing the exchange operating. The calling-drop of the magneto system was displaced by a relay and a small electric incandescent lamp, and whereas in the older system the calling-drop and the answering jack with which it was associated SUBSCRIBER'S were some distance apart, the calling-lamp and the answering jack OFFICE SUBSCRIBER'S CIRCUIT of the newer system were placed in juxtaposition. This alteration improved the operating conditions in three ways. In the first place it increased the visibility of the signalling instrument; in the second place it brought that instrument into the position in LIRE o-which it could most readily catch the operator's eye; and finally it eliminated the effort involved in associating one piece of apparatus with another and in finding that other. Moreover the clearing-out drop of the cord circuit was replaced by an arrangement which included the provision of one signal to be controlled through the agency of a relay by the calling subscriber, and another to be controlled by the person wanted. These supervisory signals took the form of lamps and were placed on the keyboard in positions immediately adjacent to the associated cords. With the adbption of relays the signalling between the subscribers and the exchange became automatic, and, with the introduction of the principle of double and automatic supervision on the cord circuits, it became possible for the operators to tell at any instant the state of a connexion. As a result the time occupied by an operator per call was reduced from 50.77 seconds to 16.63 seconds. Threefundamental common battery transmission systems have been devised and are shown in figs. 8, 9 and To. In the Hayes system (fig. 8) a repeating coil is placed in the cord circuit, and when two sub-scribers are connected together the winding connected to the line of the subscriber who is talking for the time being acts as primary, and the other, which is in the line of the listening subscriber, as secondary. The conditions permit of the circulation of the alternating currents of low periodicity, which are used for operating the bells, but in respect of the battery the circuit is open until the subscriber lifts the receiver, when the hook switch, thus released, joins the transmitter with one winding of an induction coil in series across the circuit. A current then flows and I I in passing round the circuit operates the line relay, with the result that the calling-lamp is lighted. The operator, whose attention is thus attracted, inserts a peg in the jack, then throws over the speaking key of the cord circuit, and having ascertained particulars of the requirement places the other peg of the pair in the nearest multiple jack of the wanted subscriber, whom she proceeds to ring up. In the meantime the calling- lamp has darkened; and each subscriber's line being equipped with a cut-off relay whose function it is to disconnect the calling variation in resistance of the transmitter spoken into causes a apparatus while -the circuit is in use, the insertion of a peg is im- variation of the pressure at the line terminals of the impedance mediately followed by the disappearance of the calling signal. coils, and since those terminals are common to the two circuits The supervisory lamp associated with the peg in the wanted sub- the variable E.M.F. operates in the line of the listening subscriber, scriber's jack glows from the time that the peg is inserted until other circuit to which it is connected for the time being. An improvement in this respect has been effected by the insertion of condensers in the cord circuits, coupled with the use of two EXCHANGE sets of impedance coils, one set on each side of the condensers. Dean's method (fig. so) embodies the idea of supplying current to the transmitters over the line wires in parallel instead of round the loop circuit, as in the other systems referred to. An earth return is used. The transmitter is placed in multiple with the primary winding of an induction. coil whose secondary operates in the loop circuit, and con- sequently when the transmitter is spoken into, a variable E.M.F. is impressed upon the circuit through the medium of the induction coil. The impedance coils shown connected between the battery and the lines and between the latter and the transmitters are joined up non-inductively as regards The Stone system (fig. 9) is characterized by the use of imped- the transmitter circuits, but inductively as regards the secondary ance coils between the battery and the line wires. When one of circuits. Figs. II and 12 indicate typical subscriber's and con- two subscribers connected together by this arrangement talks, the necting-cord circuits as equipped by the Western Electric Company. ExeHANc At the subscriber's station when the receiver is on the hook From the Post Office Electrical Engineers' Journal. "A" The the circuit is through the call-bell and a condenser. From the Post Office Electrical Engineers' Journal. bells was such that not more than two or three persons could be connected without seriously impairing the efficiency of the circuit for speech transmission. An improvement was effected in this respect by the introduction of the " bridging " system, in which the bells possessing high inductance are placed in parallel between the two wires of the circuit. Although the bells are constantly in circuit their high impedance prevents any appreciable interference with the telephonic currents. In America, on farmers' circuits, ten or more stations are frequently connected to one line; . but in England ten is practically the maximum. In city districts the modern practice is to restrict the number to four stations per line, and to equip the exchanges and stations for selective ringing. In one arrangement, now in extensive use, each telephone set is fitted with a relay of high inductance which is bridged across the circuit in series with a condenser. When the relay is operated it connects a bell between one of the wires of the circuit and earth, while the bell itself is arranged to respond to current pulsations in one direction only. The four tele- phones on a circuit are so wired that the relays rt, connect two of the bells between each wire and "~ryyr earth, and further that one of each pair of bells responds to positive and the other to negative pulsations. This system of course requires that the exchange equipment shall include machines capable of delivering a positive pulsating current and a negative pulsating current, besides the usual alternations required for the ringing of ordinary subscribers. In another party line system a harmonic principle is employed : the ringing machines deliver alternating currents of four frequencies, while frequency only. Of the four bells connected to a circuit each responds to a different frequency. Trunk Line Working.—Trunk or long-distance working is complicated by the necessity for recording all calls. The system of the British Post Office is worked as follows: A subscriber desiring a long-distance connexion calls tip his local exchange in the ordinary way, and the operator there, being informed that a trunk connexion is desired, extends the subscriber's line to the Post Office by means of a record circuit. At the Post Office a record operator replies and takes particulars of the connexion, and these are entered upon a ticket. The record operator then removes her speaking apparatus from the circuit, and the local operator, receiving a disconnect signal, severs the connexion at the local exchange. Meanwhile the ticket is conveyed to the position where the lines to the town wanted are terminated. If there be a line free, or when the turn of the call is reached, particulars of the connexion wanted are passed to the distant end, and the trunk operators request the local exchanges to connect the subscribers by means of junction Answc*,NG PEG e,.. Mw Lw. .M.R Ow.oMU...1 the subscriber responds, when it darkens, in which condition it remains until the subscriber restores the receiver to the hook and causes the lamp to light up again. The other supervisory lamp on the cord circuit is controlled in a similar manner by the sub-scriber who originated the call, and as that subscriber's telephone is off the hook when the peg is inserted, the lamp is not lighted at all until the subscriber replaces the receiver. When both lamps glow, the operator, who thereby knows that both subscribers have restored their instruments, discontinues the connexion. A cord circuit, similar in many respects, including the method From the Post Office Electrical Engineers' Journal. of operation, but equipped with condensers and impedance coils, in place of the repeating coil, is shown in fig. 13. In fig. 11 a meter or counter is shown associated with the sub-scriber's line, and in both figs. 12 and 13 position meters are shown connected to the cord circuits. The operation of these meters is controlled by the operators. The subscriber's meter is joined in multiple with the cut-off relay, and whenever a peg is connected to the circuit a current flows through the meter. This current is small, however, and the meter is not operated until a much larger current is passed through it. Calls are registered by pressing a key, which connects a battery through a position meter of very low resistance to the socket of the line jack, thereby furnishing the necessary energy to the meter. The position meter just mentioned is common to all the cords on one position and records all completed calls handled at the position. Some administrations, in addition to employing the ordinary position meter, use a second one for registering ineffective calls. In large towns served by a number of exchanges the junction equipment is an important feature. In many cases from 6o to 8o per cent. of the calls originated at an exchange are for subscribers con- - a w„ nected to other exchanges, and in these cases the junction plant forms a considerable fraction of the whole equipment. Moreover each call junctioned is dealt with by at least two operators. The junction circuits connecting two exchanges are invariably divided into two groups, one for traffic from exchange A to exchange B, the other for traffic from B to A. At the outgoing end the circuits are multipled on the subscribers' switch- „.,.. W. board, while at the incoming end they terminate in plugs on a special incoming junction switchboard upon which the subscribers' lines are multipled in the usual way. When a subscriber at exchange A asks for a connexion to a subscriber at B, the operator at A, to whom the request is made, passes the particulars over an order wire to an operator at B. The latter names a disengaged junction circuit, then " tests " the line of the wanted subscriber, and if she finds it free, finally completes the connexion and rings the subscriber. During the progress of these operations the A operator connects the originating subscriber to the junction circuit named by the B operator. There is only one signal on the cord circuit at B, and that signal is controlled by exchange A. Each of the subscribers controls a signal at A, and when either or both of the telephones are replaced, the action is indicated by the lamps there. Control of the call is thus vested in the operator at the originating exchange, at which point the connexion must be severed before a clearing signal can appear at B. Party Lines.—A circuit which serves more than one subscriber is termed a " party line.” It was originally tiie practice to place the calling apparatus in series in the line circuit, but the effect of the large impedance introduced by the electromagpets of the call- From the Post Office Electrical Engineers' Journal. circuits to the trunk exchanges where the necessary connexions are made between the trunk line and the junctions. The call is controlled by the trunk operators, the junction circuits being equipped in such a manner that the subscribers' signals appear at the trunk exchanges, from which point disconnecting signals are sent automatically to the local exchanges, when the connexions between the trunk and the junction circuits are removed. The large modern trunk exchanges are equipped with relays and lamps for signalling purposes. " Calculographs " are employed for stamping the time upon the tickets, and there is associated with each trunk circuit a device which lights a lamp as soon as the scheduled limit of the period of conversation is reached. Particulars of calls are now passed between trunk centres to a great extent over telegraph circuits superposed upon the trunk o...* . n lines. This arrangement permits particulars of calls to be passed over lines while conversations are in progress. Automatic Systems.—The idea of automatic telephony is to substitute for the operator of the manual exchange an electromechanical or other switching system, which, controlled in its movement by the action of the subscriber, will automatically select, connect and disconnect circuits as desired. Several schemes em-bodying this idea have been developed, and one of them has been put into extensive operation. Each subscriber's circuit on this system terminates upon the incoming portion of a selector switch, called a first selector, and is multipled upon the outgoing portions of a number of similar switches called connector switches. Only calls originated by a subscriber pass through the selector switch (first selector) provided for his sole use; the calls incoming to him pass through one or other of the various connector switches upon which his circuit is multipled. Each connexion involves the use of three switches, viz., a first selector, a connector switch, and a second selector which is brought into operation between the other two. The subscribers' lines in an exchange are arranged in groups of I000, which are divided in turn into sub-groups of too each. By means of his first selector the circuit of a calling subscriber is connected to the outgoing end of a junction whose other end terminates upon the incoming portion of a second selector in the thousand group to which the wanted subscriber belongs. The second selector in turn extends the connexion by means of another junction circuit to one of the connector switches in the hundred group wanted, while finally the connector switch completes the connexion. One hundred circuits are connected to the outgoing portion of each switch, and the contacts upon which they terminate are arranged in a number of horizontal rows upon the face of a curved surface, at whose axis a vertical shaft is placed. This shaft, which carries a set of " wipers " connected to the incoming circuit, is susceptible of a vertical and a rotational movement, so that the wipers may be brought, first opposite any particular horizontal series of contacts, and then into actual contact with any particular set in the series. The movements of the shaft are con-trolled by relays and electro-magnets which operate in response to the action of the subscriber whose telephone is fitted with a calling mechanism which, when the subscriber calls, earths the line a certain number of times for each figure in the number of the wanted subscriber. Wire Plant.—In suburban and rural districts subscribers are usually served by means of bare wires erected upon wooden or iron poles. As subscribers' lines are invariably short, the smallest gauge of wire possessing the mechanical strength necessary to with-stand the stresses to which it may be subjected can be employed, and bronze wire weighing 40 lb per mile is commonly used. In large towns telephone distribution by means of open wires is practically impossible, and the employment of cables either laid in the ground or suspended from poles or other overhead supports is necessary. In the types of cable that were first used, the wires, usually with a cotton insulation, were drawn into lead tubes, and the tubes filled with paraffin or other similar compound, which kept the wires from the injurious effects of any moisture which might penetrate the lead tube. This form of cable has been superseded by a type with paper insulation. The separate wires are surrounded only with a loose covering of specially prepared paper, which furnishes abundant insulation. In the manufacture of the cable the wires are first enclosed in the paper, which is applied sometimes longitudinally and sometimes spirally. The conductors are then twisted in pairs with definite lays. These pairs are laid up symmetrically into cables, each layer being protected with an additional covering of paper and all adjacent layers revolving with an opposite twist. The cable is then placed in an oven, and, after all moisture has been driven off, it is passed through a lead press whence it emerges protected by a continuous lead pipe. The electrostatic capacity of a cable of this type is low, and its dimensions are small, the external diameter of a cable containing 1600 ten-lb conductors being only 21 in. The conductors used for subscribers' circuits are of copper weighing from to to 20 lb per mile. Junction circuits are usually made up of 20 or 40 lb conductors. When a number of cables follow the same route, they are gene-rally laid in conduits made up of earthenware or cement ducts; iron pipes are used when the number of cables is small. Manholes are placed at intervals in the line of ducts to facilitate the drawing in and jointing of the cables, and surface boxes are placed in the footways for distributing purposes. Various methods of making the connexions between the large main cables and the subscribers are in use. In one system the main cables terminate in large air-tight iron boxes placed in the manholes. There, the large cables divide into a number of small cables, which are carried along the footways in pipes and are tapped at suitable points to serve sub-scribers. Another method of distribution, largely adopted, is to run the lead cables into the interior of blocks of buildings, and to ternnate them there in iron boxes from which the circuits are distributed to the surrounding buildings by means of rubber-covered wires run along the walls. Aerial distribution from distributingpoles is a method frequently adopted. In this case the cables terminate upon the poles, the connexions between the cable wires and the open wires being made with rubber-covered leads. The introduction in 1883 of the hard-drawn copper wire of high conductivity invented in 1877, by T. B. Doolittle was of the greatest importance in rendering the use of long lines practicable, and it is universally employed for such service. Wire weighing between' 15o and 400 lb per mile is generally used. The New York-Chicago line, built in 1892, is of wire 165 millimetres in diameter (No, 8 Birmingham), weighing 435 lb per mile and having a resistance of 2.05 ohms per mile. Speech has been habitually transmitted for business purposes over a distance of 1542.3 m., viz., over the lines of the American Telegraph and Telephone Company from Omaha to Boston. Conversation has been carried on over 2200 M. of No. 8 line. As no practical process of telephone relaying has been devised, it is extremely important that the character of the line should be such as to favour the preservation of the strength and form of the telephone current. In circuits possessing high resistance and capacity and low inductance per mile, telephonic currents are rapidly attenuated, and the higher the frequency the more rapid is the attenuation. Moreover, as the velocity of propagation is a function of the frequency, there is distortion of the complex waves. Oliver Heaviside showed mathematically that uniformly-distributed inductance in a telephone line would diminish both attenuation and distortion, and that if the inductance were great enough and the insulation resistance not too high the circuit would be distortionless, while currents of all frequencies would be equally attenuated. Following up this idea, Professor M. I. Pupin showed that by placing inductance coils in circuit, at distances apart of less than half the length of the shortest component wave to be transmitted, a non-uniform conductor could be made approximately equal to a uniform conductor. Many circuits have been " loaded " in the manner proposed by Pupin during recent years, especially in underground cables, and it has been found in practice that the transmission value of these when loaded is approximately from three to four times their value unloaded. Open aerial long-distance lines have also been loaded, but not to the same extent. The introduction-of inductance coils into such circuits renders them more susceptible to trouble from atmospheric electricity and more sensitive to leakage variations. In consequence of their high capacity, the attenuation constant of submarine cables is high, and only a small number of cables, of comparatively short length, are in use for telephonic purposes. Attempts have been made to improve submarine cables in this respect, and in 1906 a short cable " loaded " with Pupin coils was laid across Lake Constance. The problem, however, of constructing a deep-sea cable satisfactorily, with suitable inductance coils inserted at short distances apart, is a difficult one, and one which it cannot be said has been solved. (H. R. K.) Commercial Aspects.—The records of the telephone industry in Great Britain during the thirty years from 1877 to 1907 form an instructive chapter in the industrial history of the country. The aspects which stand out most prominently in this history are: (a) The vacillation of successive governments due to the conflicting policies adopted from time to time to protect the telegraph revenues of the Post Office and to avoid the suppression of an enterprise which was becoming a public necessity and yielding substantial royalties to the Postmaster-General. (b) The obstructive use made by the local authorities of their power to veto underground wayleaves. (c) The remark-able success achieved by the National Telephone Company, despite these obstacles, in developing an extensive organization and a profitable business. The chief events in chronological order are: 1876. Graham Bell's telephone patent was granted for the United Kingdom. 1877. Edison's telephone patent was granted for the United Kingdom. 1878. Professor D. E. Hughes invented the microphone, but did not apply for letters patent. The Telephone Company, Limited, was formed to acquire Bell's patent. During the passage of the Telegraph Bill 1878 through parliament the Postmaster-General endeavoured, without success, to insert a clause declaring that the term " telegraph " included " any apparatus for transmitting messages or other communications with the aid of electricity, magnetism, or any other like agency." 1879. The Edison Telephone Company of London was formed. Both the Bell and the Edison Companies opened negotiations with the Post Office far the sale of their patents to the government, but without success. The Edison Company announced its intention to start telephone business in London, and the Postmaster-General instituted proceedings against the company for infringement of his monopoly rights under the Telegraph Act 1869. 1880. The two companies amalgamated as the United Telephone Company Ltd. Mr Justice Stephen decided (Attorney-General v. Edison Telephone Company, 6 Q.B.D., 244) that the telephone was a telegraph, and that telephone exchange business could not legally be carried on except by the Postmaster-General or with his consent. The decision covered also future invention in regard to " every organized system of communication by means of wires according to any preconcerted system of signals." 1881. The company's appeal against the decision was withdrawn, the Postmaster-General agreeing to grant licences for restricted areas of about 5 m. in London and about 2 m. in the provinces. The licences merely condoned the infringement of the Telegraph Act 1869, and did not confer powers to erect poles and wires on, or to place wires under, any highway or private property. The licensee was precluded from opening public call offices and from laying trunk lines from one town to another. The licences were for 31 years, expiring in 1922, without any provision for purchase or compensation, and were subject to the payment of a minimum royalty to the Post Office of to per cent. of the gross revenues. The United Telephone Company confined its operations to London; subsidiary companies were formed to operate in the provinces. The Post Office at the same time established several telephone exchanges in provincial towns so as to enable the Postmaster-General " to negotiate with the telephone companies in a satisfactory manner for licences." 1882. The Postmaster-General (Mr Fawcett) declared that he would issue no more licences unless the licensees agreed to sell telephones to the Post Office. As a result only eight companies out of over seventy that had applied obtained or accepted licences. 1883. The Post Office proposed to engage in active competition with the telephone companies, but the Treasury at that time opposed this policy on the ground that the state should at most be ready to supplement and not to supersede private enterprise. 1884. The licences within restricted areas having proved unsuitable for the growing business, public opinion appealed to the Post Office to issue new licences applicable to the whole country. All limitations of areas were removed and licensees were allowed to open public call offices but not to receive or deliver written messages, and they were allowed to erect trunk wires. The royalty of to per cent. was continued. The Post Office reserved the right to compete either directly or by granting other licences, and it was under no obligation to grant way-leaves. The new licences were to terminate in 1911 without any provision for purchase or compensation in that year, but with the option to the government to purchase the plant of the licensees in 1890, 1897, or 1904 at a price to be deter-mined by arbitration. The United Telephone Company asked parliament for rights of way in streets but was refused, and its only right to place overhead wires was obtained by private wayleaves. 1885. The United Telephone Company again applied unsuccessfully for right to lay wires underground. 1888. The application of the company for permission to lay wires in streets was again refused. 1889. After the withdrawal of the restriction against the companies erecting trunk wires it became evident that the development of the telephone services throughout the country would be facilitated by complete intercommunication and uniformity of systems, and that economies could be effected by concentration of management. The various companies therefore amalgamated as the National Telephone Company. 1890. The government had the option to buy out the companies under the licences of 1884, but did not exercise it. The Bell telephone patents expired. The National Telephone Company applied to the London County Council for permission to lay wires underground and continued efforts till 1899 to obtain this power, but without success. 1891. The duke of Marlborough, in the name of the New Telephone Company, inaugurated a campaign for cheaper telephone services, but the New Telephone Company was subsequently merged in the National Telephone Company. 1892. The National Telephone Company again applied to parliament for powers to lay wires underground; public discontent with inadequate telephone services was expressed, and at the same time the "competition of the telephone with the Post Office telegraph became more manifest. The government again changed its policy. It compelled the companies to sell their trunk wires to the Post Office, leaving the local exchanges in the hands of the companies. It also expressed willingness that the companies should have rights of way in the streets. 1893. The National Telephone Company again applied to parliament for power to lay wires underground, but was refused. 1894. The draft agreement between the government and the National Telephone Company to carry out the policy of 1892 was submitted. to parliament and led to much discussion. Local authorities (particularly London and Glasgow) refused to permit the company to lay wires underground. 1895. A select committee of the House of Commons (with Mr Arnold Morley, Postmaster-General, as chairman) was appointed " to consider and report whether the provision now made for the telephone service in local areas is adequate, and whether it is expedient to supplement or improve this pro-vision either by the granting of licences to local authorities or otherwise." The committee was not unanimous and made no report, but merely submitted to the House the evidence it had taken. 1896. The trunk wires were transferred to the Post Office in pursuance of the policy of 1892, but for all practical purposes the local authorities had vetoed the permission of the government to the company to lay wires underground. 1897. The government had an option to purchase the plant of the company under the licences of 1884, but did not exercise it. The corporation of Glasgow having persisted in its efforts to obtain a licence, the Treasury appointed Sheriff Andrew Jameson (afterwards Lord Ardwall) a special commissioner to hold a local inquiry in Glasgow to report whether the telephone service in that city was adequate and efficient and whether it was expedient to grant the corporation a licence. The commissioner reported that the service was adequate but not efficient; that the rates were reasonable but that the corporation was responsible for unreasonably withholding facilities, thus rendering the service inefficient; that it was inexpedient to grant the corporation a licence because the funds of a city ought not to be applied for the benefit of a limited class of citizens; that delay and waste would result from two systems in one area and would increase the difficulties of the government in 1911; and that the corporation had not proved it could work the licence without placing a burden on the rates. 1898. The policy of the government was again changed; Mr R. W. Hanbury, Financial Secretary to the Treasury and representative in the House of Commons of the Postmaster-General, advocated the granting of licences to local authorities. A select committee was appointed with Mr Hanbury as chairman to consider " whether the telephone service is calculated to become of such general benefit. as to justify its being undertaken by municipal and other local authorities, and if so under what conditions." The committee reported (9th August) that the telephone service was not likely to become of general benefit so long as the present practical monopoly in the hands of a private company shall continue." The committee considered that the Post Office was not prevented either by legal agreement or by good faith from limiting or ending the monopoly of the company, and that competition appeared to be both expedient and necessary in order to extend and popularize the service and to avoid the danger that a purchase of the company's undertaking at an inflated price might be forced upon the government. While considering that a really efficient Post Office service would afford the best means for securing such competition, it recommended that general, immediate and effective competition should at once be undertaken either by the Post Office or by local authorities. The Association of Municipal Corporations passed resolutions on the 28th of April that " the subject of telephonic supply should be treated as an imperial and not as a local one, and that the Postmaster-General should have the sole control of the telephone system," and " that in the event of the Postmaster-General not taking over the telephone service it should be competent for municipal and other local authorities to undertake such services within areas composed of their own districts or combination of such districts." 1899. In pursuance of the report of the select committee, 1898, the Telegraph Act 1899 was passed to enable the Post Office to develop its telephone exchange business, for which a loan of z,000,000 was sanctioned, and to empower local authorities, subject to certain conditions, to enter upon telephone business. The licence of the National Telephone Company was extended so as to be co-extensive with that of a competitive licence for any locality on condition that the company should afford intercommunication with the telephone systems of the new licensees. In short, all-round competition was authorized, and the Post Office decided to establish a telephone system in London in competition with the company. 1900. The Telegraph Act 1899, while providing for intercommunication between the telephone systems of the local authorities and the company, did not give the Post Office the right to demand intercommunication between its exchanges and those of the company. The Post Office co-operated with the London County Council to put difficulties in the way of the company which had placed wires underground in London with the consent of the local road authorities. In February the Postmaster-General applied for an injunction to restrain the company from opening any street or public road within the county of London without the consent of the Postmaster-General and the London County Council, which injunction was granted in July. 1901. The government policy of 1899 was abandoned in London, the Post Office making an agreement with the company in regard to the London business. The company consented to free intercommunication between its subscribers and those of the Post Office, and undertook to charge rates identical with those charged by the Post Office. The Postmaster-General on the other hand agreed to provide underground wires for the company on a rental, and agreed to buy in 1911 the company's plant in London at the cost of construction less allowance for repairs and depreciation. 1904. The government had option to purchase the company's provincial plant under the licence of 1884. Negotiations took place, but no agreement was reached. 1905. The government contracted to buy the company's plant in 1911, thus in effect annulling the act of 1899 which had failed to accomplish its object of establishing all-round competition. By 1907 altogether 59 local authorities had examined the proposition of establishing telephone systems after 1899, and licences were granted to local authorities at Brighton, Belfast, Chard, Glasgow, Grantham, Huddersfield, Hull, Portsmouth, Swansea, Tunbridge Wells, Oldham, Scarborough and Hartle-pool, but only six municipalities proceeded with the business. Glasgow opened its exchange in March 1901, Tunbridge Wells in May 1901, Portsmouth in March 1903, Brighton in October 1903, Swansea in November 1903 and Hull in October 1904. The Tunbridge Wells and Swansea municipal undertakings were subsequently sold to the National Telephone Company, and the Glasgow and Brighton undertakings to the Post Office. Hull and Portsmouth were the only municipal telephone systems working in 1907. The effect of the unsettled policy of the Post Office until Tnos and of the difficulties created by the local authorities was that the National Telephone Company was never able to do its best to develop the enterprise on the most efficient lines. In 1885 there were only 3800 telephone subscribers in London and less than to,000 in the rest of the United Kingdom, and telephonic services were available in only about 75 towns, while in the same year the American Bell Telephone Company had over 134,000 subscribers. The removal in 1884 of the prohibition against the erection of trunk lines at once enabled considerable expansion to take place. Within six years the services had been extended to 400 towns with about 55,000 subscribers. Large as this progress was it would have been much greater if the Telephone Company had been granted adequate powers to put wires underground and thus instal a complete metallic circuit in place of the single wire, earth-return, circuit which it was constrained to employ. Subsequently the progress was still greater. In 1906 there were 30,551, equal to 7.2 per cent., more telephone stations in the United Kingdom than in the ten European countries of Austria, Hungary, Belgium, Denmark, Holland, Italy, Norway, Portugal, Russia, Sweden and Switzerland, having a combined population of 288 millions as against a population of 42 millions in the United Kingdom. Apart from France, Germany and Switzerland, there was no European country that had as many telephones working as London. That city, with a population of 6 millions, had nearly as many telephones as the whole of Sweden with about the same population, or as the whole of France, with a population of 39 millions. The only European country which can be compared with the United Kingdom in telephone development is Germany. With a population of 58 millions there are 10.2 telephones per I000 of the population in that country compared with 10.15 in Great Britain and Ireland. The development of telephony in the United States of America is much greater than anywhere else; on the 1st of January 1907, 5 per cent. of the population were telephone subscribers. Tariffs.—Telephone business is characterized by two features: (I) that the capital account is never closed, and (2) that the costliness of the service increases with the size of the undertaking. The original method of charging adopted in Great Britain took the telephone instrument as the unit, charging a fixed annual rental independent of the amount of use to which the instrument was put. The study of telephone economics showed that the proper basis for charging was the " message-mile," on the theory that theuser should pay according to the facilities offered and the extent to which he made use of them. In a large city, where several inter-connected exchanges have to be built and thousands of subscribers are put into communication with each other, the service is at once more costly and more valuable than in a small town with a few hundred subscribers accommodated in one exchange. Differences not only in the size of towns, but in the arrangement and character of the population, make each district a telephone problem by itself, and nullify close comparisons between telephone rates and telephone efficiencies in different areas and different countries. But the tendency is towards a system of charging a moderate sum to cover the rent of the instrument and an additional fee per message. For instance, in the county of London, the telephone tariff is £5 per annum plus Id. per call within the county and 2d. per call outside the county. Subscribers outside the county of London pay only £4 In annual subscription and Id. per call to sub-scribers on the same exchange and 2d. per call to subscribers on other exchanges. In each case the minimum annual amount for message fees is £1, tos. The alternative is given of an unlimited service (" flat rate ") at £17 per annum. In the provinces the unlimited service costs only £7, Tos. for subscribers within half a mile of the exchange, £1, 5s. being charged for every additional quarter of a mile or fraction thereof. The toll or message rates are £3, with Id. per call, with a minimum of £T, Ios. As the cost of the service varies in proportion to the amount of use, the toll rate is more scientific, and it has the further advantage of discouraging the unnecessary use of the instrument, which causes congestion of traffic at busy hours and also results in lines being " engaged " when serious business calls are made. The tariff for unlimited use has to be made very high to cover the cost of the additional burdens thrown upon the service, and it only works economically to the individual subscriber who has an exceptionally large number of calls originating from his instrument. The message-rate system equalizes the charges according to the service rendered. Another method of charge, known as the " measured service rate," is de-signed to make the subscriber pay in proportion to the quality and quantity of the service he takes. It is widely used in America, and was introduced into Great Britain in 1907. The subscriber pays a fixed annual rent which covers a certain number of free out-ward calls, say 500; additional calls he purchases in advance in blocks of several hundred at so much per hundred, the price being reduced as the number increases. For subscribers who desire the telephone for occasional use, the party-line system has been devised, whereby several telephones are connected to one line leading to the exchange. In London a two-line party service costs £3 per annum, the message fees being id. per call to subscribers within the county and 2d. per call to those outside it, with a minimum of £3. The fee charged for the use of public telephone call offices is 2d. per message. The trunk line service is charged for on rates which vary from 3d. (for 25 m.) up to Is. (for Too m.) for a three minutes' conversation between 6 a:m. and 8 p.m. For every 40 M. above Too m. an additional 6d. per conversation is charged. A reduction has been made in the charges for trunk calls at night, and calls for single periods of three minutes are allowed at half the ordinary rates between 7 p.m. and 7 a.m. A call between London and Liverpool, which ordinarily costs 2s., can he made for is. between those hours. The growth of traffic on this basis has been considerable, and the arrangement has proved of advantage to the public, as it provides cheap facilities at times which are convenient for social conversation. Telephone subscribers may telephone ordinary messages to any post office which may be reached through the local exchange system, or by means of the trunk wires, in order that the messages may be written down and forwarded as telegrams or express letters or ordinary letters. Subscribers to exchanges may also make arrangements to have all telegrams (except Press telegrams) ad-dressed to them delivered by telephone instead of messenger. Telephone subscribers may also obtain the services of an express messenger by telephoning to the nearest post office connected with the exchange. National Telephone Company.—The issued share and debenture capital of the company on the 31st of December 1907 was: 15,000 6% 1st preference shares of f, To each. . £150,000 15,000 6% 2nd preference shares of £Io each . 150,000 250,000 5 % 3rd preference shares of £5 each . . 1,250,000 6 % preferred stock . 2,225,000 Deferred stock . . 3,366,425 71,715 new shares of £5 each 358,575 £7,500,000 31 % debenture stock . . 2,000,000 4% debenture stock . . 1,716,593 £I 1,216,593 The company has a reserve fund of £2,467,707, the major part of which is invested in the business. The gross income for the year 19u7 amounted to £2,702,228, of which £257,920 was paid to the Post Office in respect of royalties. The working expenses amounted to £1,530,093 or 62.6 per cent. of the net income, leaving a profit for the year of £914,216. At the time of the formation of the various telephone companies the enterprises were regarded as speculative, and much of the capital was raised at a discount. The business subsequently proved profitable, good dividends were paid, and the securities for the most part commanded ,a premium in the market. After the consolidation of the companies in 1889-1890 the profits declined, patent rights had expired, material reductions were made in the rates for telephone services, and considerable replacements of plant became necessary, the cost of which was charged to revenue. Agreement of 1905.—By this agreement the Postmaster-General agreed to purchase all plant, land and buildings of the National Telephone Company in use at the date of the agreement or constructed after that date in accordance with the specification and rules contained in the agreement, subject to the right of the Postmaster-General to object to take over any plant not suited to his requirements. The price is to be fixed by the Railway and Canal Commissioners as arbitrators on the basis of the " then value," exclusive of any allowance for past or future profits or any compensation for compulsory sale or other consideration. In those cases in which the company's licence has been extended beyond 1911 (Glasgow to 1913, Swansea to 1926, Brighton to 1926 and Portsmouth to 1926) the Postmaster-General will buy the unexpired licence with allowance for goodwill. The Postmaster-General agreed also to buy the private wire plant of the company at a value based upon three years' purchase of the net profits on the average of the three years ending 31st of December 1911. The Postmaster-General also agreed to lay underground wires for the company at an annual rental of £1 per mile of double wire in any local area in which the company was operating, but not in areas in which the municipalities had established exchanges. Free inter-communication was established by the agreement between the subscribers of the company and those of the Post Office, and a scale of charges was ado¢ted or arranged to be agreed as binding on both the Post Office and the company. The late Mr W. E. L. Caine, general manager of the company, stated before the Select Committee that in the view of the directors the bargain was a hard one, because it gave no consideration in respect of the goodwill of the great business, with its gross income of over £2,000,000 per annum and its net revenue of over £750,000, which the company had built up. The company had had to pay for all the experiments and mistakes which are inherent in the launching and development of any new industry. It had paid the Post Office in royalties already £1,848,000, and the Post Office under the agreement would step into the business in 1911 by merely paying for the plant employed. The Association of Municipal Corporations and the London County Council, on the other hand, considered the terms of purchase to be too favourable to the company. The London County Council, according to the statement of its comptroller, was disturbed by the hope expressed by the manager of the company, that the holders of the company's ordinary shares would obtain the par value of their shares in 1911. Inasmuch as the debenture stocks and preference shares would have to be redeemed in 1911 at premiums ranging from 3 to 5 per cent., the state would have to pay the company £253,000 in excess of the total of the outstanding securities in order to enable the ordinary shares to receive par, and in the touncil's view this payment would diminish the probability of the Post Office being able to afford a substantial reduction in the telephone charges. Post Office Telephones.—The number of trunk wire centres open on the 31st of March 1907 was 533, and the total number of trunk circuits was 2043, containing about 73,000 M. of double wire. The capital expenditure on the purchase and development of the trunk wire system amounted to £3,376,252. The total number of conversations which took place over the trunk wires during the year 1906-1907 was 19,803,300. The gross revenue derived from the trunk services was £480,658, being an average of 5.82d. per conversation. The total number of subscribers to the Post Office provincial ex-changes on the 31st of March 1907 (excluding those in Glasgow and Brighton) was 10,olo, and the number of telephones rented was 12,006. The Glasgow system included 11,103 subscribers' lines with 12,964 telephones, and the Brighton system contained 1542 subscribers' lines with 1884 telephones. The sum received by the Post Office as rental in respect of private wires was £183,000. The years' working of the whole telephone system of the Post Office showed a balance of £451,787 after payment of the working expenses, while the estimated amount required to provide for depreciation of plant and interest at 3 per cent. on the total expenditure of £7,252,000 was £432,726. The number of telephones connected with the Post Office system in the metropolitan area on the 31st of March 1907 was 41,236, and additional subscribers were being connected at the rate of about 15o a week. There were 425 post office call-offices in the London area. The length of underground pipes which had been laid in the metropolitan area for telephone purposes was 2030 M. Cables containing 317,789 M. of wire had been laid, including 69,066 m. rented by the National Telephone Company. The average cost of constructing an exchange circuit in the metropolitan area (includingthe installation of telephone instruments and of exchange apparatus, but excluding the provision of spare plant) has been £33. Taking into account the whole system (including spare plant of all kinds), the capital expenditure per station (i.e. per telephone connected with an exchange) stands at less than £50. International Telephone Lines.—The Anglo-French telephone service, which was opened between London and Paris in April 1891, was extended to the principal towns in England and France on the 11th of April 1904. The service has since been extended to certain other English provincial towns; and the Anglo-Belgian telephone service has similarly been extended. There are now four circuits between London and Paris, one between London and Lille, and two between London and Brussels, the last carrying an increasing amount of traffic. Experiments have been made in telephonic communication between London and Rome by way of Paris. It was found possible to exchange speech when the conditions were exceptionally favourable; but in spite of the partial success of the experiment, a public service between the two capitals is not at present practicable.
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