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COCOTs, cost, and AOS.


The payphone industry accounts for over $2 billion a year in coins, $4 billion generated by long-distance calls on non-coin units.

The key incentive for a private payphone with an alternate operators service (AOS) is a contract at three or four times the percentages currently offered by the LEC.

Another incentive, as the COCOT (customer-owned coin-operated telephone) is installed and maintained by a local vending-machine company, would be regular route maintenance.

Many businesses limit use of PBX lines for business-related calls and provide payphones for their employees for personal calls.

The expense of providing payphones can be reduced by using private payphones.

BOCs try to keep up with the competition by offering higher percentages on local and intrastate calls; they cannot complete with profits offered by long distance.

Though the earnings looked good, some early customers got payphones that did not meet minimum expectations. The equipment cost $1000 to $4000. The COCOTs didn't look like familiar payphones, and people eschewed them.

Technical problems beset early models. Many couldn't determine long-lines call completion, exasperating both parties and often resulting in destroyed equipment.

Lack of operator service was confusing. The phones are linked on standard business lines to local telco COs; call metering and operator services aren't available.

Many COCOT providers did not fulfill their promises for payments or commissions. Others folded as quickly as they had gotten in, leaving clietele stranded.

Use of the AOS was a partial solution to the operator problem, although some states prohibit or restrict them with regulation.

Highway Robbery

It is often a month after the call, when the long-distance service bill arrives, that the consumer realizes he has been charged an outrageous price.

AOS companies get away with charging so much largely because they are unregulated. The high access fee the AOS pays the local telco is taken out of the consumer's hide along with bookkeeping charges. The public is unaware of the AOS and places calls before realizing the price difference.

The FCC says on AOS has to identify itself when answering the phone, provide billing info on request, and let callers reach a carrier other than the default carrier selected by the premise owner.

As a business traveler, you should know your company's policies for dealing with telephone calling while on the road. Identify set-up charges for calls from your room.

Identify specific long-distance charges through the operator. Never give your credit or calling-card information until you are ready to make your call.

When you feel you might be charged too high a price, request connection to the carrier of your choice.

If all else fails, try the payphones in the lobby. Carry the access code for the carrier of choice, as it will probably not be posted there.

The three primary long-distance carriers are, of course, AT&T (10288), MCI (10222), and US Sprint (10333).
COPYRIGHT 1990 Nelson Publishing
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Copyright 1990 Gale, Cengage Learning. All rights reserved.

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Title Annotation:customer-owned coin-operated telephone, alternate operator service
Author:Bateman, Nancy
Publication:Communications News
Date:Oct 1, 1990
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