PART 14.

RETURN OF THE RAILROADS TO PRIVATE OWNERSHIP.

COMMITTEE ON INTERSTATE AND FOREIGN COMMERCE,

HOUSE OF REPRESENTATIVES,

Tuesday, September 16, 1919.

STATEMENT OF CAPT. S. W. BRYANT, UNITED STATES NAVY, ACTING DIRECTOR OF NAVAL COMMUNICATIONS.

Capt. BRYANT. Admiral Bullard has prepared a memorandum for you, Mr. Chairman, I believe, on the question of radio transmission, or wireless and its regulation. To our minds the language of the bill is not clear, as to its intent in the proviso contained in the last five lines on page 2 and on the top of page 3.

The CHAIRMAN. Is that the committee print of the bill?

Capt. BRYANT. That is H. R. 4378, at the bottom of page 2 and top of page 3. The question in our minds was whether or not this provision exempts the transmission of intelligence between a fixed point in the United States and a fixed point in a foreign country. It would seem to be desirable that the provision of the bill should not apply to transmission of this character, except as to the question of rates to and from shore radio stations, but rather that this should be controlled by international agreement. The regulations covering the transmission of intelligence by means of wireless telegraphy are provided by certain international conventions of which the United States is a signatory party, the one at present in force being the London convention of 1912. This convention, on account, presumably, of the youth of the art, distinctly reserved the regulation of the transmission of information or intelligence by wireless telegraphy between fixed points to the high contracting parties, having in mind, of course, fixed points in different countries and, naturally, claiming no jurisdiction concerning wireless communication between fixed points in one country, as that is a matter of national control and not an international affair.

Another thing, there does not seem to be anything in the bill that exempts the regulation of wireless transmission involving fixed land stations along our coast in communication with ships at sea. This question is entirely covered by the regulations of the present international treaty, and it is a question as to how far local laws would interfere with international treaties or international laws on the subject contained in the London convention or future international conventions.

Mr. HAMILTON. An act of Congress can supersede a treaty, and if we should choose to do that it could be done.

Capt. BRYANT. Yes, sir. The point I wanted to bring out was that it was already regulated by international treaties.

Mr. HAMILTON. An act of Congress can supersede the treaty?

Capt. BRYANT. Oh, yes, sir; I understand that. In the London convention, where the international treaty was drawn up, the United States delegation made a reservation as to the matter of rates and abstained from any action with regard to rates. The question of rates has never been brought into question, as they have always been less than those, that were arranged by international treaty or convention. We thought that it would not be wise to bring that class of transmission under the regulation of the Interstate Commerce Commission, except as to the question of rates to and from shore stations. We, of course, were very much in favor of that as to rates to or from shore stations. With us it is simply a question of the regulation of the transmission between shore stations and vessels at sea. It is suggested that a proviso might be added.

In line with my remarks concerning the transmission of intelligence by wireless between a fixed point in the United States and a fixed point in a foreign country, I have to recommend that the regnlation of such transmission be exempted. I suggest that the following be inserted in the bill H. R. No. 4378 after line 7, page 3:

The provisions of this act shall not apply to the transmission of intelligence by wireless (1) between coastal stations and ships at sea except in the matter of land line rates to and from the shore station, (2) between points in the United States and points in a foreign country, except in the matter of land line rates to and from the radio stations on United States territory.

The CHAIRMAN. Where would you put that?

Capt. BRYANT. I suggest that might come in after line 7 on page 3, or wherever you think it would be most convenient.

The CHAIRMAN. At the end of a paragraph?

Capt. BRYANT. Yes, sir. If the provisions of this act do apply to transmission between fixed points that is, between one point in the United States and one point in a foreign country-I should like to have an opportunity to submit further data on that subject, Mr. Chairman.

The CHAIRMAN. You may extend your remarks in the record of the hearing.

Capt. BRYANT. I will do so.

The CHAIRMAN. I do not think it was contemplated when the bill was prepared that it would cover communications between shore stations and vessels of the Navy at sea, that being departmental work under the jurisdiction of the Navy Department, and it ought not to be under the Interstate Commerce Commission.

Capt. BRYANT. I was referring to our work in connection with the commercial business that is transmitted. We have to communicate from our coast stations with foreign ships as well as United States merchant ships. We do that business at our coast stations.

The CHAIRMAN. You have that service on the Pacific coast now to Hawaii and the East?

Capt. BRYANT. Yes, sir; we maintain a service through to Japan and the Philippines.

The CHAIRMAN. A commercial service?

Capt. BRYANT. Yes, sir; we have all of those stations now under the Navy Department.

The CHAIRMAN. The cables are not sufficient to carry the business? Capt. BRYANT. No, sir.

The CHAIRMAN. So that you have opened the naval stations to commercial business because of the inadequacy of the cable lines and other means of communication?

Capt. BRYANT. That is what it amounts to.

The cables can not take care of the traffic, and the naval radio stations are handling the overflow.

The CHAIRMAN. How do you fix those rates?

Capt. BRYANT. We are keeping to the same rates that were previously fixed by the commercial companies that operated those stations before they were taken over by the Navy Department.

The CHAIRMAN. They were taken over under the war powers, as a war emergency matter, were they not?

Capt. BRYANT. Yes, sir.

The CHAIRMAN. Is it contemplated that they will be restored to private ownership after the emergency is over?

Capt. BRYANT. Yes, sir.

The CHAIRMAN. Then, this legislation should be addressed toward their future, when peace shall come?

Capt. BRYANT. Yes, sir.

The CHAIRMAN. You think there should be some regulation?

Capt. BRYANT. On the question of rates on connecting land lines to and from the radio stations; yes, sir. As to the regulation of the transmission, that, I think, is a matter for international convention, and there will be an international convention within the next six months, I believe, on this subject of radio.

The CHAIRMAN. Have you any other suggestions to offer, Captain? Capt. BRYANT. These remarks are based upon the assumption that none of the provisions apply to the construction and operation of stations by any department of the Government itself, but always, of course, with the exception of land wire rates. So far as this commercial business between fixed points wholly under United States jurisdiction is concerned, there can be no objection, and there would be none, to the control of rates by the Interstate Commerce Commission. The law to-day as to the transmission of commercial business by naval radio stations provides that the rates are subject to the control of Congress.

The CHAIRMAN. Or such instrumentalities as Congress may desig

nate.

Capt. BRYANT. It specifically says that such rates shall be regulated by Congress; that is, fixed by the Secretary of the Navy, subject to control of such rates by Congress.

Mr. MERRITT. I understood you to say that it was contemplated that those stations would be turned back to their private owners?

Capt. BRYANT. Yes, sir.

Mr. MERRITT. But now you are talking about the Navy continuing in the commercial business.

Capt. BRYANT. Where there are commercial stations within 100 miles of our stations we are not permitted to operate commercially, provided the commercial stations maintain continuous service. Mr. MERRITT. You are not permitted by what?

Capt. BRYANT. By law.

Mr. MERRITT. But after the war emergency ends, will the Navy still own some stations?

Capt. BRYANT. We will own most of them.

Mr. MERRITT. I thought you said you would turn them back to their private owners.

Capt. BRYANT. The private stations that we took over will be turned back.

Mr. MERRITT. Were those naval stations built under the same law or power?

Capt. BRYANT. They were built for use in connection with the handling of our naval forces.

Mr. MERRITT. Under the war powers?

Capt. BRYANT. No, sir; most of them were built before the war. The whole system was built with the idea, first, of being able to use them in connection with the operation of the naval forces, and second, to provide a subsidiary use for commercial purposes.

Mr. DENISON. What is the reason for doing that?

Capt. BRYANT. They do it principally to supply the public with the service that they demand.

Mr. DENISON. It is not any part of the business of the Navy Department to supply the commercial demand, is it?

Capt. BRYANT. No, sir; except that these stations are not running to capacity, and so long as they are there and not more than 50 per cent of the time are they engaged in particular naval uses, the other part of the time we feel that they can be turned over to the public for their uses.

Mr. DENISON. What do you do with the revenue?

Capt. BRYANT. It is turned into the Treasury as miscellaneous receipts.

Mr. DENISON. Is that because of the fact that the private stations can not supply the demand for service, or is it simply a desire on the part of the Navy Department to provide this service, which is it?

Capt. BRYANT. For both reasons. We are required to have a number of coast stations for our fleet.

Mr. DENISON. Yes.

Capt. BRYANT. There were at one time a few commercial stations, 20 or so, about the coast, that did transact commercial business and in out of the way places our naval stations took up that business and transacted it where there were no commercial stations. During the war these commercial coast stations, the low-powered stations, were purchased by the Navy Department and they handle practically all of the ship to shore work, that is, during the war, but after the war, according to the present law, if the commercial companies put up stations along the coast within 100 miles of our stations and maintain continuous service we will have to close up our stations and we will not be able to transact commercial business, even if the public wants us to do so.

Mr. HAMILTON. I should like to ask you a few questions simply to get some information for some of us who are not very well informed in the subject.

When did the Navy Department begin to install the wireless service?

Capt. BRYANT. In the very beginning, I think, about 1904.

Mr. HAMILTON. What corporations are there engaged in the wireless service?

Capt. BRYANT. That is, commercial companies, you mean?
Mr. HAMILTON. Yes, sir.

Capt. BRYANT. There is the Marconi Co., the Tropical Radio Telegraph Co., the International Radio Telegraph Co., and there is a radio company which is called the Ship Owners' Radio Association, I think.

Mr. HAMILTON. Could you give, in a general way, the scope of the Government wireless operations at this time?

Capt. BRYANT. Yes, sir.

Mr. HAMILTON. In a general way.

Capt. BRYANT. Yes, sir; we practically own about 95 per cent of all coastal and other radio stations in the United States on United States territory.

Mr. HAMILTON. You say coastal?

Capt. BRYANT. Yes, sir; that is the ship-to-shore as distinguished from the transoceanic stations.

Mr. HAMILTON. Take the Atlantic coast, how many stations are there?

Capt. BRYANT. The low-powered stations, that is, the ship-to-shore stations, I should say, roughly, between 30 and 40. I can not give you the exact number.

Mr. HAMILTON. And how many on the Pacific coast?

Capt. BRYANT. On the Pacific coast, including Alaska, there might be about 25.

Mr. HAMILTON. Does this system practically in operation now extend around the world?

Capt. BRYANT. We are in communication with all our outlying possessions by means of the Navy radio system.

Mr. HAMILTON. You answer that it covers all of our outlying possessions, and beyond that, by cooperation with the other nations, the service extends around the world, I take it?

Capt. BRYANT. It is not established around the world. It could be if the other nations cared to extend our transmission.

Mr. HAMILTON. The other nations have not gone so extensively into the service?

Capt. BRYANT. Yes, sir; more extensively, especially the British Government.

Mr. HAMILTON. Then, it is easily possible, by cooperation of the nations, to extend the service around the world?"

Capt. BRYANT. Yes, sir.

Mr. HAMILTON. The Navy Department took over the wireless service, did it not, before there was any enabling act?

Capt. BRYANT. No, sir. The radio act of 1912 authorized the President to do that in time of war, and he took over the stations in accordance with that act.

Mr. HAMILTON. Subsequently there was a law which originated with this committee, as I remember, and Mr. Daniels appeared before the committee, if I am no. in error, Mr. Chairman; and I think that the Navy Department had already taken over the radio system. The CHAIRMAN. Yes; that was on the hearing on the bill to take over the wireless system.

Mr. HAMILTON. Yes, sir.

Captain, could you give in a general way the extent of the service by private corporations at this time?