PACIFIC CABLE RATES.

New Zealand Herald, Volume LXIII, Issue 19511, 15 December 1926, Page 12

PACIFIC CABLE RATES.

The new tariff under discussion by the Pacific Cable Board will not excite much enthusiasm. The capacity of the system will presently be vastly increased by the opening of the second cable between Fiji and Canada, an enlargement of the board's equipment that will be' wholly free of capital charges since its cost has been defrayed from the accumulated profits of the last 11 years. Those profits were obtained by maintaining a tariff which was admitted to be excessive by the board's repeated refusal of reductions on the ground that they would induce greater traffic than it could handle. Two years ago, a reduction was made —of 5d a word in the case *of ordinary messages between New Zealand and Britain—but the latest report, covering a full year's operations at the -lower tariff, disclosed a clear profit of £IOO,OOO. The gross receipts certainly declined by £BI,OOO, but this was due primarily to loss of business in America to more enterprising competitors. Now, with all-the advantages of its exceptional financial position, the board proposes to reduce its charge for New Zealand by 2|d, to which the Imperial Government is to add lid in respect of the Atlantic cable, while a further reduction is to be obtained in Australia by the Commonwealth Government modifying its terminal charges. Similar alterations in. respect of Canada and the United States are also proposed. The actual concessions by the board are estimated at £50,600 a year—abmit half last year's surplus—but the board is confident that this will quickly be neutralised. That statement is a sufficient demonstration of the inadequacy of the proposals. It might have been expected that, contemplating the vast new works that have been constructed out of past profits, the board would have been moved to seize a wonderful opportunity for quickening and expanding communications within the Empire. The small concession now proposed will neither satisfy the board's customers nor create the great volume of new traffic which the augmented system is capable of handling.