Economics of telephone relay applications

Today's telephone central office is largely built around the telephone relay. As each office may use some 60,000 of them, their performance characteristics, as well as their first cost, have a very important influence on the cost of the office. By properly balancing such factors economically, the lowest cost office can be planned. This paper shows how performance features and design factors may all be expressed as “equivalent first cost,” and so be related to manufacturing cost itself. The influence of lot-size on manufacturing cost is considered including a determination of optimum lot-sizes, to aid the relay designer in deciding on standardized models. With a basic performance language formulated — equivalent first cost — optimum relations among the variables may be established. Such results are given for (a) optimum coil-plus-power costs, (b) optimum power-plus-speed costs, (c) optimum number of relay codes, and other related problems. Methods are also given to evaluate how serious the effect may be when optimum conditions are not satisfied. Were it not for the application of these methods, central office costs would be much higher.