A new market research study released by Bellcore indicates interest in cellular and paging grows substantially when prospective subscribers learn about calling party pays services.
Interest in calling party pays service is highest among those who are considering purchasing paging service, said Don Grise, Bellcore’s director of wireless networks and interconnection. The study estimates the paging market could grow by an additional 30 percent or more with the introduction of calling party pays services. The cellular industry could experience an additional 20 percent or more growth with the same introduction.
However, the potential for current subscribers of cellular service to switch to calling party pays service is low, and is even lower for paging, said Grise.
“It has to do with the fact that existing traditional cellular customers and existing paging customers are satisfied with their services for the way they use them,” he said.
Bell Communications Research Inc. conducted separate studies for the cellular and paging industries. Altogether, the company held four focus groups and interviewed more than 700 subscribers, potential subscribers and those that could potentially call a calling party pays subscriber.
Grise said people calling a calling party pays cellular or paging subscriber are willing to pay for the charges as long as they are reasonable.
“They are willing to do it,” said Grise. “In the five states where there are paging party pays, users are placing calls to paging party pays subscribers at a rate in excess of 5 million calls per month.”
Grise said in order to make calling party pays service reach its potential, the service needs ubiquitous coverage. Currently, the service for cellular and paging is available in only a dozen or so states, he said.
“It’s possible to have the service without ubiquity. Money can be made, but to reach its full potential, it must be ubiquitous,” said Grise.
AirTouch Cellular has been aggressively pushing ahead with calling party pays service. The company has expanded the service to all of its major markets and many of its second-tier markets, said AirTouch spokeswoman Lisa Bowersock. Other cellular carriers continue to say customers aren’t interested in it.
“It’s an extremely popular service within its intended segment,” said Bowersock. “It’s a very targeted product that appeals to a segment of the market that use their cellular phone as an extension of their home or office. Because [customers are] using that cellular phone as an extension, they have a tendency to receive more calls and want to manage those costs … Certainly there is a segment of new users that find it very appealing.”
Caller pays only works in local calling areas at this time because the carrier doesn’t have a way to bill across long distance networks, said AirTouch. The inability to bill for some long-distance calls and the complex jumble of exchanges necessary to pass some calls have caused problems for other carriers that are trying to offer the service. Bell Atlantic Nynex Mobile still only offers the service in Phoenix, Albuquerque, N.M., and El Paso, Texas.
“There’s no technical solution to be able to charge the caller for a call placed to a cellular phone. You can’t track it back,” said Bell Atlantic Nynex spokesman Jim Gerace. “We are fine for calls made in our own calling area, IntraLATA you can’t. It’s an industry-wide problem.”
On the paging side, landline operator Ameritech Corp. has the ability to track a call to a pager and capture where the call came from and bill the caller.
“In effect, it’s the same technology the [local exchange carriers] use for caller ID,” said Jay Brooks, director of SourceOne Wireless Inc., a paging carrier in Illinois that offers calling party pays service in the Midwest through an agreement with Ameritech Information Industry Services, a division of Ameritech. Ameritech compensates SourceOne a portion of the 35-cent fee for each call.
SourceOne said it now has slightly more than 200,000 calling party pays subscribers after launching the service more than a year ago. Callers are willing to pay the 35-cent charge to page someone, said Brooks.
“We’re targeting the general consumer and we target a slightly younger demographic. However, it’s not to say the service is not attractive to all demo groups because it is. We have subscribers within all groups.”
Brooks said the service has definitely penetrated a market that traditional paging could not reach.
