F.—l.

Improved medium-wave transmitting-equipment lias been provided at Hokitika, Blenheim, and Nelson, the previous equipment being released for temporary use elsewhere. With a view to relieving the congestion on the medium-wave aeradio channels, the Wellington, Palmerston North, Blenheim, Nelson, and Christchurch stations have been supplied with transmitters for operation 011 short waves, and similar equipment will be provided shortly at other stations. This equipment will be utilized for intercommunication between the aeradio stations, leaving the 900 metre wave for solely ground-to-plane communication. An experimental direction-finding station for use in connection with the Rongotai aerodrome (Wellington) was opened at Palmer Head, near Lyall Bay, on the 7th November, while direction-finding equipment has been installed at the Nelson aerodrome and will be brought into service shortly. Equipment for direction finding and also for approach beacons is to be installed at several other aeradio stations. . in v. The establishment of a permanent aeradio station at Raoul Island, in the Kermadec Group, has been approved by Government, and a second radio operator has now been provided at that station. INSTALLATION OF RADIO EQUIPMENT FOR MARINE DEPARTMENT. On behalf of the Marine Department, radio-beacon equipment has been purchased and installed at Cape Campbell, Marlborough. The station transmits the signal ZLOB. Radio equipment for communication with the mainland has also been installed on behalf ot the Marine Department at Cuvier Island, Moko Hinau Island, and The Brothers lighthouses. TELEPHONE-EXCHANGE SERVICES. TELEPHONE DEVELOPMENT. Telephone development continued during the year at a very gratifying rate, and notwithstanding that several telephone statistical records have been established in recent years the figures for t it* year now under review exceed those of any previous year in the history of the Department. At the 31st March the total number of subscribers had reached the high figure of 157,605. lhe number of new connections was 19,025, exceeding the previous year's record by 695 ; but allowing for relinquishments the net gain in subscribers during the year was 9,755, or 6-6 per cent. At the end of the year the total number of telephone stations (subscribers' connections, extension telephones, public call offices, &c.) was 202,712. If to this number is added the number of telephones (3,504) connected by private lines with toll stations, the total number of telephones in service in New Zealand at the 31st March, 1939, was 206,216, an increase of 7-4 per cent, over the number in use at the end of the previous year. n , ~ The telephone density in the Dominion is now 12-69 telephones per hundred ot population, a figure which is exceeded in the United States of America only. During the year a Telephone-manager was appointed to control the operating, accounting, and commercial sections of the Telephone Branch at Dunedin. Concurrently with the installation at Hamilton in November of a modern toll-board equipped for sixteen operators' positions, a Telephonemanager was appointed at that place also. RESIDENTIAL TELEPHONE CONNECTIONS : REDUCTION IN CHARGES FOR MISCELLANEOUS EQUIPMENT. During the year the charges for certain items of miscellaneous telephone equipment associated with residential connections were reviewed. Residential users had been required to pay for auxiliary apparatus on the same basis as business subscribers, and it was felt that, in view of the less extensive use made of such apparatus in residential premises and the consequent lower maintenance charges, the cost to residential subscribers should be reduced. From the Ist October, therefore, the following reductions were made in the charges for auxiliary apparatus associated with residential telephone connections :—

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Installation Charge. Annual Rental Charge. Item of Equipment. , _ „ * Old. New. Old. New. __ ....... £ s. d. £ a. d. £ s. d. f a. d. Extension telephones (ordinary) .. •• 0 15 0 0 10 0 I 10 0 0 15 0 Hand-microtelephones (automatic black) .. .. 0 10 0 0 5 0 Hand-microtelephones (automatic coloured) .. 2 0 0 1 10 0 0 5 Extension bell — Ordinary .. .. •• 0 12 6 0 7 6 0 7 6 0 5 0 Loud 0 12 6 0 7 6 0 10 0 0 7 6 Portable telephones— , „ „ ,, _ _ . Automatic i! J 0 0 15 0 Jack equipment for plugging in portable '* 0 15 0 telephones * No alteration.