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Report Mackay Companies A N N U A L R E P O R T O , T HE T RUST EES O , HE MA C KA Y C O MP A N IES T O T HE SHA REHO LD ERS T H E M A C KA Y C O M P A N I E S , , IC RS O E . C H M CK Y P ESID EN T . R N C . LA E E A A , R - G EO RG G . A R , IC E P ES ID EN T . E W D , R R C P S E . A . EA UR E DW D LATT, TR R K B R B C S EC ET A Y . AL E T E , R R K G N E A L O UN SEL I I M . C E C W LL A W OO , R S TRUS TEE . C R N C H M CK Y LA E E . A A , I I M C K W LL A W. OO . G RG G R EO E . WA D. R C P EDWA D . LATT , R B R . SMIT H O E T A . H N RY , M R I H E . E ED T , M R LT O B CK . M N W . LA A T HE MA C KA Y C O MP A N IES To T HE SHAREHOLDERS : Your Trustees make the following report : Your companies were never in better condition physiw fi ffi u the cally, nancially or in the e ciency and enth siasm of staff . The twelve million dollars reali,ed about two years ago from the sale of American Telephone and Telegraph s r Company stock is till prese ved intact, in cash and in the u u New highest class of sec rities , incl ding York City bonds , f and this great und is ready for emergencies , extensions u or the taking p of a new line of business . The gross income of your telegraph and cable 1 1 companies in 9 0 was the largest in their history . In 1 1 1 u 9 , notwithstanding the temporary interr ption of your , u x telegraph company s b siness to and from Te as, Arkan O e sas , klahoma and parts of the adjoining stat s by reason o f the action of a Texas Telegraph Company ,whose wires formerly worked with your wires ,in connection with ffi u its Bell Telephone a liations , your Tr stees are pleased to report that the gross income of your companies, sepa ratel 1 1 1 y or combined, was almost exactly the same in 9 as 1 1 0 . in the preceding year 9 As to the expenses , however, E such a satisfactory report cannot be made . xpenses have s increa ed , principally by the higher wages paid to the skilled e a s and s s ce Op r tor other employees engaged in the fa t ervi , which the Postal Telegraph Company inaugurate d and n upon which it depe ds for publicfavor. This fast service has preserved to the company its full share of the general u telegraph business . Yo r Trustees believe that the public desires the greatest speed and accuracy obtainable in the ul u to u reg ar service . The res lts would seem j stify this belief. A night letter service was inaugurated by the West ern Union Company two years ago . The Postal Telegraph t Company is giving this kind of service bu is not seeking it . Careful study of its cost to the telegraph company as com u pared with the average toll received, convinces yo r Trus tees that it is carried on without a profit and probably at a loss . The night letter originated in France . It has been in use in that country for several years . u r The res lts there correspond with ou estimate of it here . They have been unsatisfactory . An authoritative statement recently published in France is to the effect that the night u be lettergram contains many nnecessary words, simply u be u ca se they may sent witho t any extra charge, and that , ffi th , the rate is insu cient to pay for e working expenses. u It is f rther stated that . The letter telegram is the outcome of a ve ry plausible u , u ex en idea ,to tili e during several ho rs of the night, p sive lines from which , until now , practically no revenue e e e But e the has be n d riv d . it app ars that conditions were not sufficiently taken into account . There are instruments which wear out ,there are employees to be paid at both ends of a line to be een operate d . The depreciation of the material has not b e considered , the employees appear to have be n a negli gible ,uantity ,the only thought seems to have been to , get more out of them . , The day letter is still another form of service . That is a propo sition to transmit in the day time a telegram of fifty words in plain language at one and a half times the regular day rate, the company retaining the right to defer the transmission until after other day telegraph mes e sages are transmitt d . The Postal Telegraph Company e , a a declined to adopt it, although r cogni ing the f ct th t it was really a cut rate fo r long telegrams . The Postal Tele , graph Company s objection to it is partly the same as to u the night letter . It encourages a wastef l use of words and slows down the service by reason of the time re,uired u fi an d detri for its transmission . It is npro table in itself ffi a mental to the regular tra c . This would have been fat l to the very fast service which the Postal Telegraph Com pany believes is the proper object of a telegraph company . Lines loaded with fifty word day letters cannot render fi v f unex ef cient public ser ice when , as so o ten happens , pected events make a sudden and great demand fo r ih stantaneo us communication . The essence of a good tele graph service and its real value to any community is its t s capaci y to send me sages and receive answers in the short an est possible time and accurately . It is evident that it is agency which above all others should be in such a state of preparedness that it may be relied on for this efficient New service in cases of great urgency and emergency . business is created when the telegraph company makes its u e service so prompt that the largest n mber of messag s , ,uestions and answers can circulate in the shortest possible ur time . A telegram carries with it the idea of gency and no telegraph company should lose sight of that fundamen tal character of urgency in a telegram . Eu co - e The governments of rope, in op ration with all of the Atlantic Cable Companies , have brought about a e e ef the change in cabl rates , designed to b n it occasional e e f It the f s nd r o a cabl egram . is cutting o cable rates on cable messages in plain unabbreviate d language to r fi un - f ce tain speci ed co tries, to one hal the rate previously -five charged , for example, from twenty cents a word to twelve and a half cents a word, subject to the messages being deferred . The Commercial Cable Company does not e ffi e r gard this as a new source of tra c . It does not exp ct that fi the traf c will be either large or profitable . This expecta is out u tion borne by the ret rns to date . The reduced rate is proper because there is a large class of persons of limited means whose need of the cable service is only occa , , u e sio al, and who have no codes to compress th ir mes s. find sage They will the new cable rate of advantage, when in times of stress or domestic affliction their nee d of cable communication with friends abroad is urgent . e u As a general proposition , however, r d ctions in present cable rates cannot be expected . Cablegrams are necessarily expensive . The cost of providing the means of transmission and of operating the means o f transmission is so great as to preclude the possibility of an se cheapness . The merc tile community by the u of highly , , speciali ,ed codes compress into a few words a mass olf necessary and important matter and the expense is part , of the merchant s Operating expense and is taken into account in his transactions . The net cost per word is ex tremel y small . The combination of the Bell Telephone interests with the Western Union created a temporary difficulty for your u companies in Texas and the adjoining states . Yo r land line system had a contract for the exchange of business with the independent Texas Telegraph Company . That as contract ran for many years , and then the Tex Company passed into the control of the American . e e e e He e e e T l phon and Tel graph Company . nc , wh n lat r the American Telephone and Telegraph Company combined with the Western Union Telegraph Com the e e e pany, so that tel phone int rests controll d both the Western Union and the Texas Company, fo r e e e the situation your companies becam intol rabl , and thereupon your Trustees proceeded to extend your land r has line system throughout that territo y .
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