Public ownership and the telephone in Great Britain : restriction of the industry by the state and the municipalities ...

Front matter

PUBLIC OWNERSHIP AND THE TELEPHONE IN GREAT BRITAIN

PUBLIC OWNERSHIP AND

THE TELEPHONE IN

Chapter II

The Telephone Licenses of 1881 and 1884 ... 8 The Government declines to buy the telephone patents. Mr. Justi-e Stephen holds that the telephone is an infringement of the Postmaster General's telegraph monopoly. 7 he Government waives the Postmaster General's monopoly rights, upon terms designed to restrict the development of t*e telephone business. The Postmaster General by means of an administrative ruling infringes the statutory rights of the owners of the telephone patents. Public opinion compels the Government to relax somewhat its restrictive measures. The Government, in effect, refuses to permit the Post Office to engage in the telephone business. The refusal is prompted in part by the unsatisfactory working of the experiment of State telegraphs, inaugurated in 1868.

Chapter III

The United Telephone Company, owner of the master patents, establishes subsidiary companies for the several parts of the United Kingdom. Those companies subsequently are consolidated into the National Telephone Company. The consolidation results in the issue of $ x 5»525,ooo of securities, which represent a cash outlay of $9,065,000. The injection of $6,460,000 of "water" is vii vnii CONTENTS

not a stock market operation, so-called, but a necessaryincident in the upbuilding of a new industry. At the time of the consolidation the profits yielded by the telephone business were high ; but since then they have averaged about eight per cent, upon the capital actually invested. The "water" injected in 1889 to 1890 is eliminated by 1903, through the practice of expending upon plant undistributed net earnings.

Chapter IV

The Compulsory Sale of the National Telephone Company's Long Distance Service 39

The growth of the National Telephone Company in the years 1885 to 1892, in spite of the lack of power to use the streets, thoroughly alarmed the Government, lest the telephone should largely replace the telegraph for the purpose of intra-city as well as inter-city communication. The Post Office Telegraphs were in no position to meet the competition of the telephone, because of the mismanagement brought about by the intervention of the House of Commons. On the other hand, the public demand for a better as well as a more extensive telephone service, made it impossible for the Government to continue to deny the National Telephone Company way-leaves. Under the circumstances the Government resolved to give the National Telephone Company moderate way-leaves; and to protect the Treasury's interest in the State Telegraphs by compelling the National Telephone Company to sell its long-distance telephone plant and withdraw from the business of providing inter-city communication. The National Telephone Company under compulsion acceded to the Government's proposal. Dr. Cameron, M. P., Glasgow, moved that the Government purchase the entire business of the National Telephone Company, local as well as long-distance; but the House of Commons rejected the motion, after the Government had protested that the increase in the State employees involved in Dr. Cameron's proposal would constitute a grave political danger.

CONTENTS ix

Chapter V

The Post Office Fails to Provide an Adequate Long-distance Service . 6$

The fear of "log-rolling" induces the Government to adopt the policy of making no extensions of the long-distance telephone service, unless no financial risk is involved, or, the districts to be served shall guarantee "a specific revenue per year, fixed with reference to the estimated cost of working and maintaining a given mileage of trunk line wire." Evidence in detail that the Government has failed to provide adequate long-distance telephone facilities. Thus far no Government elected directly or indirectly by universal manhood suffrage has been able to husband its resources so as to be able properly to finance such industrial ventures as it may have undertaken. In that respect the experience of Great Britain has been a repetition of the experience of France, Italy, Australia and Prussia.

Chapter VI

The telephone licenses of 1881 and 1884 merely waived the Postmaster General's monopoly rights; they conferred no power to erect poles in the streets, or to lay wires underground; so that, in cities and towns, the telephone wires had to be strung from house-top to house-top. As late as 1898, no less than 120,000 miles of wire, out of a total of 143,000 miles of wire were sc strung. The system of house-top wires rendered it impossible to provide a telephone service satisfactory in quality or adequate in extent ; and it delayed for years the replacement of the earth-return circuit by the metallic circuit. The National Telephone Company in 1884, 1885, 1888, 1892, 1893 and 1899 asked Parliament for statutory power to use the streets, but the Postmaster General invariably refused to permit the Company's Bills to proceed, though Parliamentary Select Committees in 1885 and 1893 had urged strongly that the telephone companies be given adequate powers of wayx CONTENTS

leave. Down to 1892, the Postmaster General, representing the Government of the day, was influenced solely by the desire to protect the State Telegraphs by hampering the telephone. In the latter year, the Government became willing to give the National Telephone Company certain moderate powers of way-leave ; but it had to bow to the will of the Association of Municipal Corporations, and give the local authorities the power to veto the exercise of any powers of way-leave that the Postmaster General at any time might confer upon the National Telephone Company. The local authorities demanded the power of veto, not in order that they might regulate the time and manner of opening the streets, but in order that they might exact payment for the use of the streets, as well as prescribe the charges which the National Telephone Company should make to its subscribers. The Association of Municipal Corporations had demanded that Parliament itself fix those charges, as well as prescribe the maximum dividends which the Company might pay; but the Government had rejected that demand, lest Parliament should prescribe unremunerative rates. The Government had an interest in the telephone charges being kept on a remunerative basis, for it contemplated taking over the entire telephone business on December 31, 191 1. The Government also received each year 10 per cent, of the National Telephone Company's gross earnings by way of royalty. Manchester, in 1894, was the first city to give the National Telephone Company permission to use the streets ; and as late as September, 1897, only fifty-nine cities in the United Kingdom had followed Manchester's example.

Chapter VII

The Duke of Marlborough's Promise and Retraction . . 99 In August, 1891, the Duke of Marlborough, the head of The New Telephone Company, announced that his Company could make a profit of 12 per cent, to 15 per cent, a year while giving Metropolitan London an "unlimited user" service at $50 or $60 a year. Tn Septem-

CONTENTS xi

ber, 1892, after The New Telephone Company had been absorbed by the National Telephone Company, the Duke of Marlborough withdrew his previous statements, saying he had "bleated a good deal about a $50 telephone." The prospectus of The New Telephone Company had announced that the cost of installing telephone exchanges would average about $170 per subscriber's wire, in the United Kingdom as a whole. At that time the National Telephone Company's capitalization was $350 per telephone in use, of which sum about $120 was "water." A large and influential section of the public refused to accept the Duke of Marlborough's retraction ; and to this day it has insisted that a telephone plant could be installed in Metropolitan London for less than $200 per subscriber's wire, and that an unlimited user service could be given for $50 a year per subscriber. Engineering estimates to that effect were submitted to Parliamentary Select Committees by the London County Council in 1895 and 1898. Mr. W. H. Preece, Engineer-in-Chief to Post Office, and Mr. J. C. Lamb, assistant Secretary to Post Office, rejected those estimates. In March, 1906, the Post Office Metropolitan London telephone plant had cost $270 per telephone in use. The Post Office, upon opening its Metropolitan London telephone exchanges, in March, 1902, rejected the public request for a $50 unlimited user tariff. It established an unlimited service tariff of $85 a year, but only in deference to public opinion. It would have preferred to establish the measured service tariff exclusively, believing that the unlimited service tariff is unsound in principle, and defensible only on grounds of political expediency.

CHAPTER VIII The Select Committee of 1895 115

A Select Committee of the House of Commons is appointed to inquire 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 the provision by the granting of licenses to

*a CONTENTS

local authorities or otherwise.'' Mr. W. H. Precce, Engineer-in-Chief to Post Office, and Mr. J. C. Lamb, Assistant Secretary to Post Office, reject the engineering estimates submitted by the advocates of municipal telephone exchanges. Mr. Lamb argues that under the existing arrangements the Government is able to protect the rights of the public as users of the telephone; that the establishment of competing municipal telephone exchanges would be liable to result in the telephone tariffs becoming unremunerative, a state of things to be avoided, seeing that the Post Office in all probability would take over the entire telephone business on December 31, 191 1. The testimony of Mr. H. E. Clare, Deputy Town Clerk of Liverpool, and official representative of the Association of Municipal Corporations, shows that the members of the Association at heart are aware that the policy of limiting the life of franchises and providing for compulsory sale at structural value, checks the investment of capital and raises the cost of the service to the public. The Committee makes no report; but its chairman, the Postmaster General, is said to have submitted a draft report disapproving the policy of granting telephone licenses to the municipalities.

Chapter IX

The London County Council Episode .... 125 From 1890 to 1899, the National Telephone Company in vain applied to the London County Council for permission to put its wires under the streets. In 1899 negotiations were broken off, and the deadlock thus established was finally broken by the Post Office in November, 1001. The London County Council tried to use the power of veto given it by the Act of 1892, first, for the purpose of prescribing the National Telephone Company's tariff; second, for the purpose of compelling the Company to agree to grant free intercommunication between its subscribers and the subscribers to the proposed Post Office Metropolitan London Telephone Exchanges. From 1899 to 1901, inclusive, the Post Office cooperated with the London County Council in blocking

CONTENTS xiii

the efforts of the National Telephone Company to get underground way-leaves in the Administrative County of London, area 121 square miles.

CHAPTER X The City of London Episode 133

The City of London, desiring to compel the National Telephone Company to permit the city authorities to fix the Company's tariff, never has given its consent to the National Telephone Company laying its wires under the streets or erecting poles in the streets. In November, 1901, the Post Office overrode the City of London, contracting to lay such underground wires for the Company as it should suit the pleasure of the Post Office to let the Company have.

Chapter XI

The National Telephone Company asks the Corporation of Glasgow for underground way-leaves, in order that it may replace its earth-return circuit with a metallic circuit, and thus give the public an efficient as well as an adequate service. The Corporation refuses way-leaves, for two reasons. First, it wishes the Company's service to remain bad, in order that it may create a public dissatisfaction which shall compel the Government to abandon its past policy of refusing to give any local authority a telephone license. Second, after obtaining a telephone license, Glasgow proposes to install an underground metallic circuit plant, and to destroy the Glasgow plant of the National Telephone Company, that Company being handicapped by lack of underground way-leaves. In September, 1897, the Government appointed Andrew Jameson (now Lord Ardwall), Sheriff of Perthshire, a Commissioner to inquire into the telephone service at Glasgow. The Commissioner reported that the continued inefficiency of the telephone service at Glasgow for the most part was due to the Corporation's refusal to give the National Telephone Company xiv CONTENTS

underground way-leaves; that such refusal was neither reasonable nor justifiable on grounds of public policy or any other grounds, unless it be deemed that the Corporation were justified in their refusal because they desired to establish a municipal telephone system, and to place the National Telephone Company "at an enormous disadvantage" in competing with them for the patronage of the public.

Chapter XII

Mr. R. W. Hanbury, Financial Secretary to the Treasury, and Representative, in the House of Commons, of the Postmaster General, the Duke of Norfolk, Attacks the National Telephone Company . .177

Mr. James Caldwell, M. P. for Lanark, makes a motion asking the Government to a'bandon its past policy of refusing to grant telephone licenses to local authorities. The motion is seconded by Mr. G. Boscawen, M. P. for Kent, Tunbridge, and Private Secretary to the Chancellor of the Exchequer, Sir Michael Hicks-Beach. Mr. R. W. Hanbury replies on behalf of the Government, offering to refer to a Select Committee the question of municipal telephone licenses. He prefers a series of charges which prove most damaging to the National Telephone Company, though they would not have passed muster with a well informed body of listeners or readers. Why Parliament and the public were not well informed.

CHAPTER XIII The Evidence Presented Before the Select Committee of

1898 194

The House of Commons orders the appointment of a Select Committee to consider and report upon the question of granting telephone licenses to local authorities. Sir Robert Hunter, Solicitor to Post Office, urges the necessity of giving the National Telephone Company adequate way-leaves. Mr. Forbes, Chairman National Telephone Company, and Mr. Gaine, General Manager,,

CONTENTS xv

argue that under the burdens and disabilities imposed upon the Company by Parliament, the Company's charges must necessarily be relatively dear, while its service must be less adequate and less efficient than the Company would wish. Mr. Arnold Morley, Postmaster General from 1892 to 1895, as well as Mr. J. C. Lamb, Assistant Secretary to Post Office, express themselves against competition in the telephone business. The Association of Municipal Corporations expresses itself in favor of municipal telephone exchanges, as the alternative to the Post Office taking over the entire telephone business. The evidence as to the manner in which the National Telephone Company exercised its right to refuse service. The evidence as to Company's policy and practice in the matter of establishing telephone exchanges in small places and in thinly populated districts.

Chapter XIV

The Report of the Select Committee, 1898 . . .215 The Select Committee makes a report that is not supported by the evidence that had been presented. It recommends "immediate and effective competition by either the Post Office or the local authority," though there is grave doubt whether Parliament and the Government can authorize such competition without violating "the equity of the understanding" that had obtained between the Government and the National Telephone Company at the time of the so-called purchase of the long-distance telephone wires, in the year 1892.

CHAPTER XV Parliament Authorizes All-Round Competition with

the National Telephone Company .... 239

Mr. R. W. Hanbury, Financial Secretary and Representative of the Postmaster General, speaks of the National Telephone Company as if it were a public enemy, if not a criminal. The Telegraph Act, 1899, authorizes unfair competition with the National Telephone Company. It knocks fully 25 per cent, off the market value xvi CONTENTS

of the National Telephone Company's securities; and it makes Mr. Hanbury a member of the Cabinet. In all other respects it is an utter failure. It is partially abandoned in 1901, and completely abandoned in 1905. The reason for the complete failure of the Telegraph Act, 1899, is the conservatism of the local authorities, and the inability of adjoining local authorities to cooperate.

Chapter XVI

The Metropolitan London Agreement, 1901 . . . 269 The Post Office harasses the National Telephone Company into granting a request which the Post Office could not make with fairness, to-wit, free intercommunication between the Company's Metropolitan London subscribers and the subscribers to the proposed Post Office Metropolitan London telephone exchanges. So far as Metropolitan London is concerned, the Government abandons the Telegraph Act, 1899, in November, 1901. The act achieved nothing of benefit to the public that could not have been attained in 1899 by means of friendly negotiation with the National Telephone Company.

Chapter XVII

The Telegraph Act, 1899, proves a complete failure also for that part of the United Kingdom known as the Provinces; and it is abandoned in February, 1905. The Post Office agrees to purchase, at reconstruction value, on December 31, 191 1, the National Telephone Company's plant. That arrangement will get the Company out of the way, in 191 1; and will leave Parliament free to determine whether the local telephone service — as distinguished from the long-distance service — thenceforth shall be conducted by the Post Office or by the local authorities. The agreement is referred to a Select Committee of the House of Commons, which Committee makes two recommendations which the Government declines to accept, on the ground that they would be

CONTENTS xvii

respectively "an infringement of a statutory right" and a "most unfair" action. A third recommendation made by the Committee, if it had been carried out, would have inflicted upon the holders of the securities of the National Telephone Company even more serious loss than had inflicted the Report of the Select Committee on Telephones, 1898, and the Telegraph Act, 1899. The agreement of 1005 will leave the British public without an adequate telephone service until December 31, 1911.

Chapter XVIII

The Municipal Telephone Exchanges of Glasgow, Brighton, Hull, Swansea, Portsmouth and Tunbridge Wells 312

The Corporation of Glasgow embarks in the telephone business, expecting to install a plant for about $95 per subscriber's line. In May, 1906, its expenditure had been $183 per subscriber's line. The corporation lays its wires under the streets ; at the same time denying the National Telephone Company all public way-leaves. It expects to destroy the Company's business in Glasgow; but it is beaten "ta.a stand-still." In September, 1906, the Corporation sold its plant to the Post Office for $1,525,000, that is, at a net loss of $58,980. Shortly afterward the Postmaster General announced that he would have to reconstruct the main exchange, as well as replace every one of the 12,800 subscribers' telephones in use. Those operations probably will cost from $500,- 000 to $750,000. The Postmaster General also announced that he would have to revise, that is, raise, the tariffs enforced by the Corporation.

In October, 1906, the Postmaster General paid the Corporation of Brighton $245,000 for its telephone plant, enabling the corporation to withdraw with a loss of $12,250. To the Corporations of Hull, Swansea and Portsmouth, the Postmaster General offered considerably less than these corporations had expended upon plant. Swansea subsequently sold its plant to the National Telephone Company. Tunbridge Wells, the only other municipality that had gone into the telephone xviii CONTENTS

business, had sold out to the National Telephone Company in November, 1903, after two and one-half years of operation.

Chapter XIX

The Post Office Monopoly and Wireless Telegraphy . 337 The Government, in 1889, resolved to acquire the monopoly of submarine telegraphy to neighboring European countries. In 1896, it failed to purchase the patents of Mr. Marconi, inventor of wireless telegraphy. In 1904, the Government carried the Wireless Telegraphy Act, largely for the purpose of protecting the revenues of the Government submarine cables. The Government curtails the use of wireless telegraphy both across sea and overland. The Government hampers the Boy Messenger and District Service Companies, for the purpose of protecting the Post Office Monopolies. An episode from the reign of Charles II.

CHAPTER XX Conclusion 348 Index 365

PUBLIC OWNERSHIP AND THE TELEPHONE IN GREAT BRITAIN

Introduction

SCOPE OF THE INQUIRY

Four factors have shaped the telephone policy of Great Britain. They have been : the desire of the State to protect the national telegraphs from competition from the telephone ; the Duke of Marlborough's letters to The Times, alleging that it was possible to supply telephone service to Metropolitan London on the basis of $50 a year for unlimited user ; the desire of the Municipalities to regulate the charges of the National Telephone Company, a licensee of the Postmaster General; and the political ambition of Mr. R. W. Hanbury, who, as Financial Secretary to the Treasury, in the period from 1895 to 1900 represented in the House of Commons, the Postmaster General, the Duke of Norfolk.

The Government having acquired the monopoly of the telegraph business in 1869, the logical thing for it to do upon the appearance of the telephone, in 1876-77, would have been to purchase the rights of the patentees of the telephone, and to make the telephone a supplement to the telegraph. But the Government was unwilling to engage in any further industrial ventures, because of the unsatisfactory working of the experiment of national telegraphs inaugurated in 1868. Under the circumstances the Government granted companies licenses to engage in the telephone business, incorporating in those licenses various restrictions upon the licensees, designed to protect the State telegraphs from the telephone. In 1884, 1892, 1899, 1901 and 1905, the Government changed, or modified, its telephone policy ; but it always adhered to two principles : to protect the State telegraphs as much as public opinion would permit ; and to secure the ultimate purchase of the licensees' telephone plants at cost of replacement, that is, with no allowance for earning power or good-will. The Government invariably preferred the interests of the national treasury to the rights of the public as users of the telephone.

In the fall of 1891, the Duke of Marlborough inaugurated a campaign on behalf of The New Telephone Company, alleging that the Company could make a profit of 12 to 15 per cent, a year while serving Metropolitan London under a tariff of $50 a year for unlimited user service. In the fall of 1892, after The New Telephone Company had been absorbed by the National Telephone Company, the Duke of Marlborough retracted the statements made in The Times letters, saying that he had "bleated a good deal about a $50 telephone." A large and influential section of the public refused to accept the Duke of Marlborough's retraction; and continued

INTRODUCTION 5

to demand for Metropolitan London an unlimited user tariff of $50 a year, and for the large cities outside of London an unlimited user tariff of $25 a year. Those demands were supported also by the argument that the National Telephone Company could afford to grant the aforesaid rates were it not for the fact that in the year 1890 the National Telephone Company had raised its capitalization to $15,525,000, through the injection of $6,460,000 of "water."

Down to 1892 the Government adhered to the policy that the National Telephone Company should have no right to erect a pole in a street or to lay a wire under a street, lest the telephone should become too formidable a competitor of the State telegraphs. In 1892, the Government modified its past policy, and became willing that the Company should have such rights to erect poles in the streets and to lay wires under the streets as the Postmaster General should see fit to let the Company have from day to day and from place to place. Thereupon the Association of Municipal Corporations, one of the most powerful political organizations in England and Wales, demanded for the local authorities the right to veto the exercise of any way-leave powers that the Postmaster General at any time or in any place might confer upon the National Telephone Company. The local authorities demanded the power of veto in order that they might be able to make a charge for the use of the streets, as well as fix the tariffs of the National

Telephone Company. They were given the power of veto ; and they used it in such a way as to retard for a number of years the replacement of the earth-return circuit telephone by the metallic circuit telephone. Some local authorities, such as the London County Council, the Corporation of the City of London, the Corporation of Glasgow and the Corporation of Brighton, never have given the National Telephone Company power to erect a pole in a street or to lay a wire under a street.

For all practical purposes the National Telephone Company remained without way-leaves in the streets until the year 1897. The resulting inadequacy and inefficiency of the service offered the public by the National Telephone Company, led to widespread popular dissatisfaction with the Company. In 1898, Mr. R. W. Hanbury, Financial Secretary to the Treasury and Representative in the House of Commons of the Postmaster General, the Duke of Norfolk, resolved to take advantage of the aforesaid widespread discontent, and to make himself the parliamentary leader of the rising movement in favor of municipal telephone exchanges. Mr. Hanbury's parliamentary activity resulted in the enactment of the Telegraphs Act, 1899. That measure, in the year 1900, made Mr. Hanbury a Member of the Cabinet in the reorganized Salisbury Ministry; and it knocked fully 25 per cent, off the market value of the securities of the National Tele-

INTRODUCTION 7

phone Company. In all other respects it was a complete failure. In 1901 and 1905, respectively, the Telegraphs Act, 1899, in effect was repealed by the political Party which had enacted it.

The policy of municipal competition with the National Telephone Company proved a complete failure, partly because of the conservatism of the municipalities, partly because of the inability of adjoining municipalities to overcome parochial jealousies and to cooperate in supplying a common telephone service.

Glasgow entered upon the telephone business with the avowed purpose of destroying the National Telephone Company's business and property in Glasgow. It was beaten "to a stand-still" by the Company.

The municipal telephone ventures of Brighton, Hull, Portsmouth, Swansea and Tunbridge Wells were no more successful than the Glasgow venture.

In 1 90 1 and 1905, respectively, the Government contracted to purchase on December 31, 191 1, at cost of replacement, the property of the National Telephone Company. At that date Parliament will decide whether the Post Office shall retain possession of the property purchased of the National Telephone Company, or shall sell the property to the several local authorities.

Chapter II The Telephone Licenses Of 1881 And 1884

The Government declines to buy the telephone patents. Mr. Justice Stephen holds that the telephone is an infringement of the Postmaster General's telegraph monopoly. The Government waives the Postmaster General's monopoly rights, upon terms designed to restrict the development of the telephone business. The Postmaster General by means of an administrative ruling infringes the statutory rights of the owners of the telephone patents. Public opinion compels the Government to relax somewhat its restrictive measures. The Government, in effect, refuses to permit the Post Office to engage in the telephone business. The refusal is prompted in part by the unsatisfactory working of the experiment of State telegraphs, inaugurated in 1868.

In December, 1876, and July, 1877, respectively, Mr. Graham Bell and Mr. Edison obtained from the British Government patents for the telephone. In 1878, Professor Hughes, of England, invented — but refused to patent — the microphone, which made the telephone "commercially" available. In that same year was established the Telephone Company, Limited, which acquired Mr. Bell's patent rights for the United Kingdom. In the following year was established the Edison Telephone Company of London, which acquired Mr. Edison's rights for the United Kingdom. Litigation over patent rights between the two companies soon followed. Partly for the purpose of ending that litigation, both companies began negotiations with the Post

Telephone Patents ° ffice forthe Sale ° f thdr P^ent rights. 1 offered to Those negotiations failed; and in May,

Government lg8o> the United Telephone Company,

Limited, purchased the patent rights of the litigants for the sum of $1, 500,000. 2

In the meantime, in 1878, the Government had made an unsuccessful effort to protect the State Telegraphs from the Telephone. While the Telegraph Bill, 1878, had been before the House of Lords, the Postmaster General had inserted the following clause : "The term telegraph in addition to the meaning assigned to it by that Act [of 1869] shall include any apparatus for transmitting messages or other communications with the aid of electricity, magnetism, or any other like agency." The House of Commons, however, had rejected the clause, and the Government had acquiesced. 3 Dr. Cameron, M. P., for Glasgow, College Division, has stated that he induced the Government to accept the rejection, the clause in question appearing to him to be a proposal to confiscate the property of the patentees.

1 The Times; January 20, 1899: The Case of the National Telephone Company, by a Correspondent ; and Hansard's Parliamentary Debates; March 29, 1892, p. 167, Dr. Cameron, Glasgow. Compare : Report from the Select Committee on the Telephone Service, 1895 ; q. 9, Mr, J. C. Lamb, Assistant Secretary to Post Office.

2 Report from the Select Committee on the Telephone Service, 1895 ; q. 4963, Mr. J. S. Forbes, Chairman National Telephone Company.

3 Hansard's Parliamentary Debates; July 29, 1884; p. 869, Mr. W. E. Gladstone, First Lord of the Treasury; August 7, 1884, p. 143, and March 29, 1892, p. 166, Dr. Cameron.

In the fall of 1879, the Edison Telephone Company of London announced that it would establish telephone exchanges in Metropolitan London ; and on November 27, and December 20, 1879, respectively, the Postmaster General, through the Attorney-General, brought

suit against the Edison and Bell Com- Postmaster . & . ._

General's Mo- pames for infringement of the Post-

nopoly covers master General's monopoly acquired under the Telegraph Act, 1869. The case was tried before Mr. Baron Pollock and Mr. Justice Stephen, of whom the latter rendered the verdict, on December 20, 1880. 1 The Court held that "every organized system of communication by means of electricity, and any communication by means of wires according to any preconcerted system of signals, were within the monopoly conferred under the Act of 1869." 2 The decision, it will be noted, held that the Postmaster General's Monopoly covered future inventions.