there are economic and service advantages in the consoHdated con- 

 struction of plant used b\- the two companies involved and, for such 

 situations, this is the common practice. This involves the joint use 

 of land, buildings, right of way, pole lines, conduits, etc. 



The economic advantages of such joint use of plant are obvious. 

 For example, one duct run with a sufticient number of ducts for both 

 companies can be built more cheaply than two separate duct runs, and 

 the same is true of pole lines. When toll cable is installed, it is an 

 economy, when practicable, to place within one sheath sufficient 

 circuits to take care of the requirements of both companies. The 

 same is true for other parts of the telephone plant. Furthermore, 

 there are advantages in having the toll switchboard in a building used 

 for exchange service and often in having inter-area and intra-area toll 

 circuits terminate at the same switchboards and use the same groups 

 of trunk to the local exchange plant. 



Other things being equal, there is an advantage in each company 

 owning the plant required for its service, and this is the basis generally 

 followed. This leads to a large extent to the joint o\\nership of 

 jointly used plant, particularly of outside plant. This includes joint 

 conduit runs, joint pole lines, and jointly owned toll cables. 



In some cases, rather than joint ownership of jointly used plant, 

 there are advantages in a single ownership by one of the companies, 

 generally the company having the largest requirements, which leases 

 some of the plant to the other company. This applies, for example, 

 to land and buildings where, because of the greater ease and simplicity 

 of transactions of various sorts, a single ownership is preferable . This 

 is also often true where the requirements of one company are small or 

 where, as a result of growth, the division of ownership of jointly oc- 

 cupied plant no longer corresponds exactly to the relative needs of 

 the two companies for the use of the plant. It applies also to the 

 temporary use by one company of spare plant owned by another 

 which will later be required for the owner's use. 



Rental Arrangements 



To meet the varying conditions, two general bases of rental are in 

 use: (1) the "reserved plant" basis, and (2) the "spare plant" basis. 



On the reserved plant basis, rentals cover plant designed and 

 constructed by the owning company for joint use with the renting 

 company or for the sole use of the renting company under a specific 

 plan mutually agreed upon, usually in advance of construction. 

 Existing plant may also be put on a reserved basis by specific agree- 

 ment. The plant reserved for the lessee provides not only for its 



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