THE EASTERN EXTENSION COMPANY.

Star (Christchurch), Issue 7605, 15 January 1903, Page 2

THE EASTERN EXTENSION COMPANY.

A BIG DECREASE IN REVENUE. THE PACIFIC CABLE COMPETITION. [Prom Oub, Corkespondent.] LONDON, Nov. 14. ■Sir John Wolfe Barry, in presiding over the meeting of the Eastern Extension Telegraph Company last Wednesday, tad much to explain to the shareholders. There has been a decrease in the revenue of £62,480 during the past, half-year. The great depression of trade in Australia, the reduction, in the rates, and the- loss in exchange are ail factors that have led to this decrease. It appeaiis that although the Australian tariff has becni reduced during the last three years from 4s 9d to' 3s per word, the actual traffic now transmitted is practically the same as when the higher tariff prevaile:l. This seems to "dispose of the contention that cheap rates mean enhanced business, but of course the depression caused by drought must be taken into account. In normal times the cheaper rate would probably have caused a considerable increase in the caible traffic to and from Australia. Last veair tha tariff reductions cost the company," according to Sir John, £26,000. # During"the half-year under review (to Juno 30 last) the chairman said the working and other expenses in the half-year hadi been* £121,000, showing an increase of £5456 over those of the corresponding period of IGOI. This advance- was almost entirely accounted, fcr by the opening of the new station's in connection -with their ■ direct Cape-Australian cable, and by the general growth of expenditure. The net profit for the half-year was £148,500, out of which the usual'lnterim dividends had been paid and £73,500 was carried forward. The general reserve fund had been debited during the year with £69,530, on account of further expenditure in- connection with the Cape-Australian cable, and, after being credited with £12,657 for interest on investments aaid the value of picked-up cable, there was a balance of £912,9b0 to the credit of this fund. This was by no means an unsatisfactory condition, of things. Adverting to the "All Red" cable, Sir John said the shareholders knew that cable wait not a private enterprise, having been established to connect Canada and 1 (New Zealand and Australia, a-nd to fulfil a> sentimental notion of what was called! an "^illBritish cable" When one came to think about what was and what was not an allBritish cable, he ventured to think that the company's connection with Australia, with the single exception of touching at one small island belonging to Portugal, was to all intents and purposes as much an allBritish route as the route to Australia via the Pacific. When the new cable was i opened competition with the company's system would at once begin. They were not glad to have this competition, and he did not think Australia would gaiu anything by it, but the directors did 1 not look at the competition with any serious amount of alarm. They felt certain that the company could offer far greater facilities, amd undoubtedly much greater certainty in the transmission of the messages compared with the. Pacific Cable Board's one single line, which had been laid with what was called " a swing ". of a length ab present almost without a parallel. They, however, could ' not help noticing that, almost for the first time, the British and the Coloniail Governments Jiad taken -vvliafc iva.s, from somo points of view, a Regrettable step in -enter; ing into competition with private enterprise, and in the present case the competition was with a company to which the' credit was due of connecting Great Britain with all her colonies and dependencies. As regarded efficiency, th- company compa/red favourably Avith any company in the world j transacting public business. The meeting '• in London of the International Telegraph Conference had now been definitely fixed to take place on May 26 next, when all matters connected with the well-being and intercommunication of cables would be deailb with exhaustively, with the advantage of the advice of people from every parfc of the globe. With reference to wireless U-le-graphy, they thought that the system would to m certain extent be useful to them, hub they did not look on wireless telegraphy as a competitor. In the course of the discussion preceding the unanimous adoption of the report and accounts a Mr Newton adverted to The 3500 miles "swing" of the Pacific cable. He said:: "Think what the result would be if they were to have a break there, and how it would swell the traffic of the existing lines, and the fact that such a break will perhaps males them much more disposed to enter into some sort of arrangement with the ca;bie companies, and' in that case I dnrosay we should get back to> higher rates. The experience of most bu?inct<s men is that the traffic is r.ot a question of rates, but a question of the amount of business that is go-ing forward. People do nob consider for a moment the cost of a telegram when it bears upon large commercial transactions, aaid altogether I do not think we need be much alarmed at the competition that has come before ais." Mr Orme did not think there could bo any doubt that the service the Eastern Extension offered was fa<r the mo-re efficient of the two, and it would be noticed in regard to the fact that there were no lesis than) 3500 miles, in one case, from one point to am-other in 'the Pacific cable, and that in'order to obviate that they would have to touch the Sandwich Mands, which was foreign territory. The Governments might yet find themselves obliged to do that.