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Newspaper Page Text
AUTOMATIC TELEPHONE SYSTEM RIGHTFULLY
BELONGS TO THE PEOPLE
BY N. D. COCHRAN
YOU know what phone service costs you now. And YOU know what
kind of service YOU get for a nickel a call.
Do YOU know that it is easily possible for YOU to have a phone in your
home an automatic phone at that with secret service, prompt service and
excellent service in every way, at A PENNY A CALL?
The people of Chicago have the chance of a lifetime. THE TELE
PHONE PLANT OF THE ILLINOIS TUNNEL CO. NOW REALLY BELONGS
TO THE'PEOPLE OF CHICAGO.
Rightfully, the entire automatic phone plant has been forfeited to the
people of Chicago under the terms of the franchise granted by council to
the tunnel company.
You will remember, perhaps, that the promoters of the tunnel company,
which 'is now operating an underground freight railway throughout the en
tire business section, got its franchise under the guise of a telephone com
pany. The people didn't know council was granting a franchise for an under
ground railway system when it granted the Illinois Telephone & Telegraph
Co. the right to construct conduits under the streets. Those conduits were
supposed to be for a phone system.
. But the promoters knew what they had sneaked through. They built
their subway freight railway and made a stab at a phone system. But they
never really pushed the phone system. They let it drag along, despite .the
fact that the automatic phone was superior in every way to the phone YOU
are now using as superior as the electric light is to the tallow candle. ,
But council didn't protect the city. In that franchise grant council in
sisted that if the automatic phone system didn't get 20,000 actual subscribers
by June 1, 1911, the phone plant of the tunnel company would be forfeited
to the city.
It also provided that if the tunnel company sold its phone system, or en
tered into an agreement to sell its phone system, to any other phone com
pany, then the automatic phone system would be forfeited to the city.
BOTH OF THOSE TERMS HAVE BEEN VIOLATED. THE AUTO
MATIC HASN'T 20,000 BONA-FIDE SUBSCRIBERS AND IT HAS EN
TERED INTO AN AGREEMENT TO SELL OUT TO THE PHONE TRUST.
Attorneys for both" the trust and the tunnel company have appeared
before a council committee, asking council to consent to the purchase of the
automatic by the trust.
The price agreed on is about $6,000,000. Now the Chicago Telephone
Co., which is largely owned by the American Telephone & Telegraph Co.,
can increase its capitalization by whatever amount it pays for the auto
matic, and increase phone rates to subscribers whatever is necessary to
pay interest on the increased capitalization.
But that might work out so as to make the increase of capitalization
much more than $6,000,000. Suppose, for instance, the American Tele
phone & Telegraph Co. were to buy the automatic from the tunnel company
for $6,000,000 and then turn around and sell it to the Chicago Telephone
Co., the same stockholders owning both companies
What is to prevent the A, T. & T. Co. from-charging the Chicago Tsl9-