16
In the first place, we cannot feel confident that the 1-step scheme as here described would certainly afford the service desired; we are prepared to learn that further expert consideration will show that 1,000-kilowatt ares, and not 500-kilowatt ones, must be installed to afford due confidence that the required service can be secured. This would mean a large increase of cost and charges for the 1-step system. Furthe there is always the risk that the 1-step scheme might be based upon the employment of obsolescent machinery.
On the other hand, the 2-step scheme is almost certainly bound up with the advance of wireless science in the immediate future. We are convinced that its results can be anticipated with confidence. It will admit of high-speed working at the outset, and any advance in this direction, such as appears likely to result from the interesting experi- ments in progress at the Army Signals Experimental Establishment, Woolwich, can be readily incorporated in it. Most important of all, this scheme will be able to carry more traffic at once than the 1-step scheme, and it is capable, at a comparatively small addition to operating expense, of carrying three times the traffic of the 1-step scheme. The power side of the scheme is no more than exists in scores of commercial generating stations, and for the valve-systems we have competent expert knowledge immediately available. Every part of the scheme can be manufactured in the United Kingdom. Important patents relating to valve-grouping are already the property of the British Government.
Our conclusion accordingly is that a scheme of Imperial wireless communication will best be effected by the employment of the system of transmission by valves over geographical steps of about 2,000 miles each.
25. At this point it is convenient to examine the "Proposal for a network of wireless communication to serve the needs of the whole British Empire," which has been made by Marconi's Wireless Telegraph Company (Limited) since this Committee was appointed. This proposal has been forwarded to the Government and to ourselves, and we have been requested by the Imperial Communications Committee to consider it from technical points of view. The question of State-ownership versus private ownership of Imperial wireless communication not coming within our terms of reference, we are restricted in our examination of this proposal to aspects which require for their appreciation technical information, but even within this restriction questions not only of technics, but also of cost, of traffic, and of future scientific development naturally arise.
LE
26, The Marconi Company's scheme is of a scope and magnitude never hitherto contemplated. It proposes the construction of 26 Main Trunk Stations," 50" Main Feeder Stations," 100 Local Feeder Stations," and 200 "Small Local Stations," or no fewer than 380 stations in all, The personnel for these includes 10 "Territorial Managers," with status equivalent in time of mobilisation to the military rank of colonel ; 20 superintending engineers (lieutenant-colonel); 30 1st class engineers (major); 370 engineers (captain); 1,840 assistant engineers (lieutenant); 650 chief operators (captain); 1,200 wireless operators (2nd lieutenant and sergeant); 7,200 operators considerable staff" of the (corporal), &c., making a total, without including the General Manager's office, of 17,170 persons, of whom 810 would be labourers, and 2,500 boys.
27. The capital cost of the proposed scheme would obviously be very high. As regards annual expenses, the average remuneration of 13,860 persons (excluding the labourers and boys) could not, at present rates of pay, be below £400 a year, taking into account the necessary provision for pensions and head office charges, and the fact that a large number would be Englishmen living in tropical climates. This would give a wage bill of about £6,000,000 a year.
The standing charges and maintenance costs could hardly be less than £1,500,000, making a total annual charge of £7,500,000. In other words, a sum of £144,000 a week would have to be received for wireless traffic before any profit could accrue.
28. The Company furnish little information as to the traffic which they expect the stations to carry, and as to the charges to be made for such traffic. Indeed, from this point of view, as well as from others, their proposals are of the vaguest possible character. But they appear to contemplate a speed of 100 words a minute, which practice, as has been shown, would represent at the outside a traffic of 40 paying
*
The Marconi contract for the Imperial Wireless Chaiu in 1913 specified a speed of 75 words per minute, but no commercial traffic at a speed approaching this has yet been regularly carried anywhere.
17
500
words a minute. The proposed five main lines of communication from the United Kingdom working duplex and continuously, would then carry 400 words a minute, or about 200,000,000 words a year, The traffic to and from the United Kingdom coustitutes the great bulk of the long-distance telegraph traffic of the Empire, and it Would be from this source that the great bulk of the revenue of the main truuk stations would be derived. But the Post Office informs us that, even at the present rates of charges, 200,000,000 words would produce considerably less than £7,500,000 a year; indeed, this amount is appreciably more than the total revenue of the cable companies from the same regions. It is therefore clear that the Marconi Company would have to look to some other source than the main line traffic if the proposed system were to be remunerative. The only source that we can see from which the necessary additional revenue could be obtained would be that between the various "Feeder" and "Local" stations-that is, from the stations which would duplicate the existing Post Office inland and foreign telegraph systems of the United Kingdom and the Dominions.
29. The Marconi Company propose that the Government should receive 25 per cent. of the net profits. Beyond pointing out that "net profits" is in any case an ambiguous term, compatible with the previous payment of past losses and of a percentage on capital, we do not examine this financial aspect of the proposal.
80. Although we do not wish to trench upon the question of private monopoly versus State ownership, we feel bound to indicate what would in our opinion be the effect of the Marconi scheme upon the development of wireless science in this country, The proposals are, it should be clearly understood, that the Marconi Company shall duplicate the systems not only of the cable companies and the State-owned "Imperial" Atlantic cable and the State-owned Pacific cable, but also the existing telegraph systems of the various Governments of the Empire. Further, "Feeder Stations are to be erected for communication between the United Kingdom and the principal towns of foreign countries, and wireless services are to be estab- lished even between the main stations and inland home towns, the Post Office land lines being employed as little as possible. To use the Company's words, "the purely internal communications of each State or Colony would be catered for by a net-work of small inter-communicating stations, adapted to meet the requirements of the country; provision being made for efficient connection with the main net-work." British Government is to secure for the Company the use of all necessary wave-lengths, And the and to facilitate the compulsory acquisition of sites.
The full development of the Company's scheme would leave no room for any further wireless service in or from the United Kingdom. The stimulus arising from competitive activity would tend to disappear; technical research would be discouraged; wireless technicians or operators could hardly look for employment outside the fighting services, except in the Company's service. Indeed, the concession, from the moment it was grauted, would tend to deprive the services and the Post Office of their best engineering personnel. The heads of the Departments of State concerned will doubtless have regard to this prospect. For ourselves, we should regard the inclusion of virtually all civilian wireless activity in the hands of one commercial company as likely to be deeply prejudicial to research and progress,
31. The Marconi Company say they do not ask for a monopoly; but under existing conditions the mere allocation to them of the necessary wave-lengths for which they ask would in effect constitute a complete monopoly, owing to the limited number of wave-lengths available for long-distance communication, of which, in any international agreement, only a proportion could be claimed by the British Empire,
We are of opinion that, in order to secure efficient working, an Imperial system, by whomsoever provided, must be protected from interference from other sources, and must, therefore, be a practical monopoly. But a State monopoly of this kind would not preclude private enterprise in other spheres of wireless activity. Wireless companies would still have an important sphere as manufacturers, and in providing and operating ship-stations, and they might, if desired, be granted concessions on suitable conditions for long-distance communications between British territory and foreign countries. Indeed, the provision of long-distance communication with foreign countries by commercial companies, and of long-distance communication within the Empire by the Government, might lead to a healthy emulation which would benent both services. On the other hand, the grant of a practical monopoly such as that asked for by the Marconi Company excludes the State altogether. We think it necessary to point out this difference very clearly,
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