Power Page L.L.C., an emerging paging carrier and reseller in Los Angeles, is not only giving away free pagers to acquire new customers, but is soliciting the help of all other Americans to do so too.
In a half-hour informercial aired in 27 markets across the country the weekend of June 21 and 22, the company’s marketing arm, Wireless Marketing, pitched what essentially amounted to a help-wanted ad. The company is recruiting people to distribute display articles containing coupons that can be redeemed for a free Motorola Inc. pager after paying for the first and last month of airtime and a $25 activation fee.
For $59, plus shipping and handling, those interested will receive the displays, information about the service and 1,000 coupons to place at movie theaters, restaurants and other high-traffic retailers”. Whenever someone redeems the coupon for the free pager and signs on for service, the person who distributed the coupon is compensated by receiving 10 percent of the activation fee and monthly airtime fees that the user pays while subscribing to the service.
According to Power Page President and Chief Executive Officer Rod Kahn, who also is president and CEO of Wireless Marketing and South Bay Wireless, the idea is to offer everyday people the chance to profit from the paging “boom.”
“We’re saying that we’re willing to give away free pagers to [promote] growth and share our profits,” with distributors at the same time, he said.
According to Kahn, the program has been successful.
“We’ve had really good response.”
He said the California, Florida, Utah and Texas spots generated responses that exceeded expectations, while New York fell below what was hoped.
Overall, Kahn said 75 percent of those calling about the program have signed up to distribute the coupons. He anticipates a 1: 1 ratio of dollars invested to dollars gained from the promotion, which is all he said was expected.
Power Page is a new paging company that acquired 929 MHz, one-way paging frequency licenses early in March, which it bought from another company with whom it has a nondisclosure agreement. The company is building infrastructure where it holds licenses in parts of Oregon, Washington, Utah, Colorado and all of California.
“Where we don’t have a footprint, we are a national reseller of PageNet,” Kahn said. Power Page also will resell South Bay Wireless’ AirTouch Communications Inc. services.
As buildout continues, Power Page’s strategy is to resell airtime until the infrastructure is finished, which Kahn said would be within a few months.
The free pager offer includes a full line of Motorola paging units for a variety of services: numeric, alphanumeric, text messaging and Internet paging. Power Page is working on reselling PageNet’s VoiceNow voice messaging service as well.
Free pagers include the Pronto, Ultra Express, Ultra Express Extra and Adviser Gold. The Tenor for PageNet’s VoiceNow service is not yet an option. Users on the West Coast also can get the Seiko Communications of America MessageWatch and service.
Although there is no long-term contract, Kahn is not concerned about users taking the free pager and then ditching to a cheaper service, forcing Power Page to absorb the cost of the paging unit. “We obviously recoup that cost shortly after,” he said of the pager cost, by charging the first and last month airtime fees up front with the activation fee, thereby covering his cost for the pager. “You’re eliminating any fraud issues.”
The monthly service fee is dependent on what service users subscribe to: $10 per month for numeric or $25 per month for alphanumeric are examples. Kahn concedes to the higher service costs, but said customers come out ahead with a free pager.
According to Personal Communications Industry Association Vice President of Paging and Narrowband PCS Rob Hoggarth, the paging industry has seen a trend toward creating more imaginative ways to get pagers out on the street. Several companies have given pagers away in the past, but have suffered the consequences in the resulting investor flight.
“It makes sense from a growth standpoint,” Hoggarth said, but once a company matures, it should distance itself from such activities as Wall Street has “beaten up” on companies that do so. “There is a decided movement away from it, from an accounting standpoint.”
However, Power Page is a privately owned company not looking for investors just yet, Kahn said, although it will go public when sensible.
