I'm guessing here, but I'd assume it was used in the transition period just before dial up phones. The old style wooden cased wall mounted pre-desk phone used the same magneto concept to ring the switchboard operator, who the caller would tell to whom they wished to be connected, the operator would physically wire the caller to the line they were calling.
I assumed it was probably for a private branch where you had a local switchboard but it could have been a public exchange as well.
I was thinking similarly, like a direct connect as opposed to block switching
That was my other thought, old corporation building(s) interconnected with the old switchboard system. Possibly even an old streetside police box phone with a direct line to the police switchboard.
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