Affect on Western Union by acquisition of the B & O Telegraph

How Absorption of the Baltimore and

Ohio Affects Western Union.

"The telegraph is the best barometer to indicate the commercial condition of the country that can be found," said President Norvin Green, of the Western Union Telegraph Company. "It varies directly in volume of business as trade varies, except in time of panic, when the telegraph business increases, though only to fall afterward. The charge that this company has increased its rates since the absorption of the Baltimore and Ohio line is not true. The rates to Chicago and St. Louis, which were 50 cents, are now 40 cents. To St. Paul, Minneapolis, Omaha, and that range, the rate, which was 60, is now 50. There is scarcely a Western Union rate any where that has been increased, except the ten-cent and fifteen-cent rates. These the other companies were handling at a loss. The Postal and United Lines have come up to our increase and are going to stand by it. I demonstrated, in fact, in my last annual report, that the average cost to us of handling a message was a little over 23 cents. On city business, for instance, from one station to another, we make nothing at all, as each message has to be relayed and requires four operators, and if sent uptown, 5 cents additional for delivery.

"The sequel of the deal shows that we have taken all the Baltimore and Ohio business, and at better rates. The Baltimore and Ohio business last year averaged $36,000 per week. Of this about three-fifths, or $21,000 or $22,000, came from the larger or test offices, which report weekly. A comparison of our revenues from the test offices for the past three weeks in this mouth shows $218,464, against $173,590 for the first week in November of last year; $219,300, against $169,000 for the second week, and $225,467, against $170,856 for the third week. We had an increase for the weeks just before, varying from $12,000 to $17,000. Add to the $21,000 of the Baltimore and Ohio receipts our own average increase of $16,000, and you get $37,000. This leaves about $15,000 per week as the result of advancing the non-paying rates of the Baltimore and Ohio. The estimated general increase in our business is about $75,000 per week over last year."

Dr. Green further gave the figures from the leading offices of the country, first for the first three weeks of November, 1887, and secondly for the same weeks in November, 1883. They were as follows: New York, 1887. $32,600, $30,600, and $33,700; 1886, $24,100, $25,500, $25,400. Chicago, 1887. $18,700, $17,900, $20,900; 1886. $14,700, $14,600, $14,500. Baltimore, 1887. $3,700, $4,000, $4,300; 1886, $2,400, $2,600, $2,700. Boston, 1887 $8,900, $9,600, $9,700; 1886, $6,500, $6,700, $6,800. Cincinnati, 1887. $4,700, $5,100, $5,100; 1886, $3,400, $3,400, $3,800. St. Louis, 1887. $8,600, $8,900, $9,000; 1886, $6,000, $6,000, $6,400. Kansas City; 1887. $4,500, $4,700, $4,900; 1886. $2,800, $3,000, $3,100. Louisville, 1887. $2,900, $3,000, $3,000; 1886, $1,800, $1,800, $1,900. New Orleans, 1887. $5,800, $6,300, $5,800; 1886, $3.500, $3,600, $3,900.

"We shall be able to handle the Baltimore and Ohio business, "he continued, "at a cost of 40 per cent. of its receipts, as soon as we get rid of their rentals. We have got off some and shall get rid of more on the 1st of May. We shall put in effect on Dec. 1, an extensive scale of changes to equalize rates and make them consistent with each other in different parts of the country. This we could not do during a competing fight. We shall level all those downward, however, and are leveling none upward except the ten-cent and fifteen-cent rates, which could not be maintained at those figures except at a loss. Our average rate per message was reduced last year from 31 1/4 cents to 30 1/4. This year it will be reduced below 30 cents, the reduction being made in the long rates."