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Calling Cards 1.0 – part 1 November 4, 2010

Posted by themobilephoneconnoisseur in Uncategorized.

I’d like to tell you the story about the now so common calling cards, how it has developed and what the future holds for them.

Let’s go back to the early 90s, before mobile phones were anything other than something very heavy and typically mounted permanently in a car.

Mainly as a reaction to huge hotel calling rates, the so called calling cards were introduced. The ads from for example MCI on TV at this time were always showing a man on a business trip calling his wife and 5-yearold daughter who were at home; the target audience was almost too obvious. The process of calling a toll free number, and then giving a sequence of numbers (access code or PIN), and finally the number to be reached, was quite revolutionary, and it made calling more affordable. For some cards, at the end of each month, a bill with the calls was summed up. Others were pre paid cards. These new calling cards cunningly restrained the hotel owner from overcharging the hotel guests on a basic need, phone calls. I personally refer to these calling cards as version 1.0.

The incentive for calling card services to be developed was especially high in the US since this was a well defined domestic market, but with a messy telephone network with excessive national (long distance) and international minute rates. Standard rates to make international calls were at this time $1-5/minute. So, even without any major technical break through of routing calls, a saving of 10-30% on pure competition between service providers became a substantial saving for the subscriber, or rather a reduced cost for the corporation that paid for their employees to call back home. The technical advancement lied instead with the technology of accessing a remote account through regular telephone networks, which was to be used in the coming advances of calling cards.

Next post: Calling Cards 2.0 – The prepaid and local access revolution.



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