Pre-Paid Long Distance

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The next money-maker in the long distance telephone business will be
focused on the way we buy and pay for long distance service.

PAY PHONES & OTHER STUFF

In the last 4 years, technological advancement in telecommunications
services has opened doors for entrepreneurs to make money selling Ma
Bell's services.

Private-Party-owned Pay Phones spread like wildfire, and 25Cent-Per-Minute
Long Distance Flat Rate Billing was introduced and gobbled up by an excited
marketplace.

PAY NOW, CALL LATER

Pre-Paid Long Distance service is nothing more than a marketing person's
dream of being able to charge for something that need not be delivered
right away.

Here's how it works:

1) You walk into a convenience store and buy a Phone Card for $10, or any
denomination it is being sold.
2) When the time comes for you to use the card, simply dial the toll-free
800 number and enter the 14-digit code printed on the card.
3) An automated operator's voice comes on the line and announces that you
have $10 worth of long distance calling available to you.
4) A dial tone comes on and you enter the area code and phone number you
want to call.

PLUS & MINUS

Pre-Paid Long Distance and collecting Phone Cards are now a big craze in
Japan. Phone Cards are now being traded like baseball cards, with values
in excess of $1,000. Companies giveaway free long distance service as
premiums and incentives, and then print their names on the Cards that they
giveaway.

But in spite of all thes fads, Pre-Paid Long Distance has some built-in
disadvantages that need to be corrected to guarantee its success.

Here are a few:
1) We are a credit-based society. We are not accustomed to paying in
advance for services we are not using at the time of purchase.
2) The rates marketing companies are charging are relatively higher than
basic phone company rates.
3) As a business, long distance resellers and marketers will be competing
for the same consumer "penny".

Mixed with something novel or commercially accepted, pre-paid phone cards
may just make it big in the U.S.