THE RIVAL CABLES.

New Zealand Herald, Volume XLIII, Issue 13148, 10 April 1906, Page 5

THE RIVAL CABLES.

INTEREST! Xi! COiUU^I'OXDEXCK.

By Telegraph — Press Association-—

Mixtiuunxb', April 9. A cikci lap issued by ilifl Australian ma« nager of the Eastern Extension Company stales that the company has decided that. ii» is morally hound to comply with the Government"** request to ccaso collecting cablegrams. Meantime legal opinion is lving taken. Most of the company's staff of operators and other employee; will probably ho transferred to other stations, tit. a. letter to the postal authorities, Mr. Hesse, the general manager, contends that the Senate's amendment is contrary to tlio spirit and letter of the Federal agreement, but. tljo company is desirous of working amicably with the Department,. and is firmly of opinion that* an agreement could bo mado which, while preserving: the independence and autonomy of fho Pacific Cable, would produce marked financial and other advantages to all tlio Governments interested in that enterprise.

The. chairman of directors of (lie Eastern Extension Company, in a. letter to Miv Deakin, points out, tlio inconvenience causal In commercial interests by clewing the Melbourne cilice, ami hints at the possibility that tlio action the Government had taken was in order to deteriorate the Eastern Extension Company's service witlil a, view of securing more business for the Pacific Cable, and thereby reducing Australasia's annual loss of £30,000 over the Pacific Cable. Complaint is made that since tlio opening of tlio Pacific Cable all the unrooted traffic between Australia and Britain lias been given to the Pacific Cable. Another complaint is the refusal by tho Government officers to accept telegrams marked "via Eastern." It is suggested that this is not legal. He suggests that ib should not- be beyond the resourcefulness of tho Federal Government and company to devise in consultation some scheme which would diminish and ultimately extinguish the financial loss now accruing to Australia from tho Pacific Cable, and also guarantee the Pacific enterprise against the, results of possible interruption. Tho Government and the company might, it is urged, find a .mutually acceptable solution.

_ In. 1901 the Eastern Extension Telegraph Company entered into agreements with the Governments of New South Wales, South Australia. West Australia, and Tasmania, which resulted in the English cable rate being reduced gradually from 4s lOd to 3s a word, while it received the right, to open local offices in all these States. These contracts were made in perpetuity. When! the. Postal Department was transferred to Federal control, Sir Edmund Barton v (the first Prime Minister) entered into negotiations with the company, with ihv object of granting it local offices in all the States in return for its forfeiting its perpetual privileges in the four Stales mentioned, and sub-< stituting an agreement, to run for 10 yews from 1905. Two yeans' notico of intention; to renounce this proposed Federal agreement had to he, given. The agreement wa« passed by tho House of Representatives, but hung fire hi tho Senate for nearly three sessions, in the hope that letter terms might be, made with tho company in the interests of the Pacific cable. La.st year, however, the Senate accepted the agreement, but first amended it so that it .should "terminate absolutely in 1913." The company was then asked to ratify the new Federal contract, but, after three month*' consideration it declined to do so. It will, therefore, fall back upon the four original State agreements. which do not give it the right to open local offices in Melbourne.