Deposit 20

Twenty-two years have passed since coin-booth telephone rates were doubled, and the nickel phone call joined the 5-c- cup of coffee, the 15-c- pack of cigarettes, the 2-c- newspaper and the 3-c- stamp on first-class mail in nostalgic oblivion. Now the 10-c- rate for phone-booth calls may also buzz off. Permission to double the rate to 20-c- has been requested by phone companies that serve six states and Canada, and other A T & T companies intend to follow eventually. Last week New York Telephone, Ma Bell's biggest offspring, requested the 20-c- public call as part of a proposed $306 million rate increase. Managers told the New York Public Service Commission that besides trying to cope with higher wage and tax costs, they must also raise $700 million in capital next year. Profit margins on revenues have fallen below 6%, v. the 8.2% that the commission set as the lowest return that could provide adequate service and attract capital. (Margins of other AT&T subsidiaries average 7.7%.)

New York Telephone also hopes to wipe out another venerable institution --the flat-rate, untimed local telephone call. In its proposed system, the cost of a call from a home phone would increase by one message unit (7.1-c-) every five minutes. That change is necessary, company chiefs said, partly because people are talking longer than they used to. Although 72% of local calls from home phones are completed within five minutes, the average duration of the other 28% has increased from twelve minutes in 1964 to 16 minutes today.

Proponents of the rate increase will contend that without it New York Telephone might relapse to the service depths of two years ago. Helped in part by higher rates, the company since 1971 has reduced the percentage of blocked calls due to circuit overloads from 4.5% to 1.6% and the number of out-of-order pay phones from 11% to 6%. Phone users notice the improvement. Written complaints to the Public Service Commission have dropped to less than half of the 1971 peak of 400,000.

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