07 Dec




















Few telephone companies paid any profits at first. They had undervalued the cost of building and maintenance. Denver expected the cost to be two thousand, five hundred dollars and spent sixty thousand dollars. Buffalo expected to pay three thousand dollars and had to pay one hundred and fifty thousand dollars. Also, they made the unwelcome discovery that an exchange of two hundred costs more than twice as much as an exchange of one hundred, because of the greater amount of traffic. Usually a dollar that is paid to a telephone company is divided as follows: Rent............ 4c Taxes........... 4c Interest........ 6c Surplus......... 8c Maintenance.... 16c Dividends...... 18c Labor.......... 44c ---- $1.00 Most of the rate troubles (and their name has been legion) have arisen because the telephone business was not understood. In fact, until recently, it did not understand itself. It persisted in holding to a local and individualistic view of its business. It was slow to put telephones in unprofitable places. It expected every instrument to pay its way. In many States, both the telephone men and the public overlooked the most vital fact in the case, which is that the members of a telephone system are above all else INTERDEPENDENT. One telephone by itself has no value. It is as useless as a reed cut out of an organ or a finger that is severed from a hand. It is not even ornamental or adaptable to any other pur-pose. It is not at all like a

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