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media: NYT: Pay Phone Companies Rush To Refit for the Internet Era

From: David Poehlman <poehlman@clark.net>
Date: Tue, 30 May 2000 10:01:44 -0400
Message-ID: <3933C9C8.89DE064F@clark.net>
To: wai-ig list <w3c-wai-ig@w3.org>
a different kind of media story for a change not one that talks about wai
bashing.

From the web page:

http://www.nytimes.com/library/tech/00/05/biztech/articles/30payphones-inter 
net.html

May 30, 2000

Pay Phone Companies Rush To Refit for the Internet Era

By DENNIS BLANK

The pay phone is an endangered species. With cell phones seemingly in every 
pocket or briefcase, fewer and fewer people must rely on phones that are 
attached, quaintly, to a wall or booth.
There are still two million pay phones across the United States, but that 
is down by 300,000 the last two years alone.

In response, the companies that make or operate pay phones are rushing to 
reinvent themselves, working to change the perception that pay phones are 
nothing but black boxes for making calls. New technology will transform 
them into tools to provide communications access to the Internet, find 
local news and weather and even offer e-mail.

In the meantime, though, economic reality is forcing the removal of many 
phones. "For every five telephones we installed in North Carolina today, 
we're taking out six," said Glenn Lancaster, president of Triangle 
Telephone in Cary, N.C.

This shift hurts poor people the most. In many urban areas, including New 
York, at least 25 percent of low-income residents have no telephone -- 
cellular or otherwise. The pay phone can be their lifeline, providing the 
only way to get help in an emergency, hunt for a job or call friends.

But when phones do not pay, they may be removed. Nationwide, the average 
number of calls for each phone has declined from 712 a year, to 588. And 
once a given phone does not yield a profit, phone companies often eliminate 
it. The cost of operating pay phones is going up faster than revenue from 
them, Mr. Lancaster said. He and other operators in North Carolina want the 
price of a call raised from 35 cents to 50 cents.

"The coin-based revenue model is dying fast as pay phone operators see 
their coin revenue model drop 20 to 30 percent," said Michael J. Boyle, 
president and chief executive of Elcotel in Sarasota, Fla., one of the 
leading pay phone manufacturers in the United States.

"They need to find a way to reinvent themselves," said John Bain, an 
analyst at Hoak Breedlove Wesneski in Dallas.

Elcotel is breaking new ground with 27 software patents that would 
transformed the black box into a snappy unit with a five-inch video screen 
that provides ads, restaurant listings and access to "800" numbers.

"Our strategy is move our industry from coins to content," Mr. Boyle said.

After spending $8 million on research, Elcotel sold 45,000 of its new 
Grapevine models for $125 million to Canada Payphone, which began 
installing them in March.

In June, new software will be installed to make them Internet-friendly. Mr. 
Boyle said new revenue would be generated from advertisers, transaction 
fees and revenue-sharing agreements. The new phones can be used with a 
credit card.

Other manufacturers are also introducing new units. Intellicall of Dallas 
introduced units that play audible spots of six seconds to eight seconds 
before a call is made.

Andrew Suzuka, president and chief executive of Key Factors Advertising in 
New York, which is teaming with Intellicall, estimates that revenue from 
the average pay phone will rise $15 a month.

The Port Authority of New York and New Jersey is installing 80 new 
touch-screen units with full Internet access at Kennedy Airport, said 
Dennis Novick, president of TCC Teleplex, an independent pay telephone 
supplier.

But he says the old-fashioned pay phone will not die. "There is a place for 
the public pay phone," he said -- for those unwilling, or unable, to join 
the cellular revolution.
Received on Tuesday, 30 May 2000 10:02:05 GMT

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