In 1877 news of the development of telephony – the electrical transmission of sound – reached New Zealand. In 1878 the government set up wires between Dunedin and Milton to test the new invention. The first public demonstration of the new wonder (linking Blenheim and Nelson) took place later the same year.
As a social tool, the telephone had more appeal than the telegraph. It provided immediate voice contact and had no code to master. Enthusiasm for the telephone led to the setting up of rural party-lines and even private telephone cooperatives by individuals – the lower Wairarapa was notable for this.
Setting up the telephone network
In New Zealand the state monopolised the development of telephone exchanges and the network from the very beginning. By contrast, in Australia (briefly), the United Kingdom (up to 1912) and in the United States (up to the present), business interests took the initiative.
Broadcasting by telephone
In the early days of telephony there was a craze for sending music, songs and even nursery rhymes over it. The novelty of telephony as primitive broadcasting soon faded in the face of its obvious value for commerce and government.
The government demanded at least 30 subscribers for an exchange to be viable; it found them in Christchurch (including the local asylum) where the first exchange opened on 1 October 1881. Auckland followed the same month. The other large population centres also gained exchanges over the next 10 to 15 years.
Subscriber numbers rose from around 50 in 1880 to 25,000 by 1910, and the number of exchanges rose to 14.
Cost to the consumer
The first subscribers paid a hefty annual fee (£17 10s.) to rent (not own) their phone. Rental cost had more than halved by 1900, as more people subscribed. Premier Dick Seddon’s rejection of the ‘American toll system’ (charging for each local call) kept prices down.
Costs for the combined telephone/telegraph system were also kept down by not sending trained telegraphists to out-of-the-way places. Small telephone offices were opened instead (first in the Otago backblocks) to allow isolated settlers, or the office telephonist, to phone in messages to the nearest telegraph office for onward transmission.