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and other countries where machine switching methods have been introduced. With practically all the essential equipment now in sight, an intensive effort is being made to hasten completion of the work, additional skilled labour from other parts of the Dominion having been concentrated- at Christchurch to assist in the construction of the internal switching system, as well as in the installation of subscribers' telephones and subsidiary apparatus. If the outstanding items of equipment for subscribers' stations come to hand according to schedule time, as is confidently expected, the whole of the Christchurch metropolitan area will be completed and converted to automatic working in a few months. One indirect advantage arising from the delay that has occurred is that the Christchurch area, being the last of the large centres to receive full automatic treatment, will have the benefit of a number of the very latest developments in machine switching equipment. As soon as the cut-over takes place attention will be directed to the installation of a further 2,000-line extension, so that no unnecessary delay will arise in meeting the growth that is expected to follow the introduction of automatic methods. Automatic Switching Equipment for Small Telephone Communities. During the year experimental work was carried out in the Department's laboratory on a small type of automatic exchange system. The equipment was obtained primarily for experimental purposes with a view to testing its suitability in actual practice for the special conditions met with in rural exchanges in New Zealand where twenty-four-hour service under manual conditions would be economically prohibitive. The experimental work has now been completed, and arrangements are being made to install this system in a suitable rural locality preparatory to its more general adoption should it be found to meet the somewhat exacting conditions encountered in such localities. Automatic Telephones in New Zealand. Of the total number of telephones in use on the 31st March, 1929, about 42 per sent, were automatic (dial) telephones, 5 per cent, common battery, and 53 per cent, magneto instruments. With its large quota of automatic telephones, New Zealand probably possesses a greater percentage of automatically operated subscribers' stations than any other country in the world. An interesting graph hereunder depicts the steady increase in the number of dial telephones in New Zealand since 1920.

GRAPH SHOWING PROPORTION OF DIAL AND MANUAL TELEPHONES IN NEW ZEALAND FROM 1920 ONWARDS.