Venture in County Viewed as Test for National Expansion : Santa Ana Firm Targets ZapMail’s Void
A Santa Ana company is jumping in where Federal Express’s ZapMail failed--transmitting facsimile copies of documents, charts and other printed information instantly over telephone lines.
American Transfax Stations already has five machines in service in the John Wayne Airport area and plans to have 200 machines around in Orange County by year-end.
“There is a need and a void out there,” said Bill McCue, American Transfax’s owner and president.
The void was reopened last week when Federal Express ended its two-year attempt to build the first nationwide network of facsimile transmission machines. The Memphis-based courier concern invested about $340 million in its ZapMail network before calling it quits.
At American Transfax stations, documents can be sent to any of the existing 500,000 fax machines elsewhere in the nation, most of which are owned and operated by businesses. “Movers and shakers have machines,” he said, and such people’s machines can be reached by anyone via American Transfax stations.
What McCue envisions is a network of independently owned fax stations in hotels, print shops, mail stations and other existing businesses easily accessible to the public. His network would link the “have-nots with the haves” and also allow customers to transmit material to other Transfax stations.
“We want to get one (a facsimile machine) on every corner,” a company spokeswoman said. A fax machine is a briefcase-size device that reduces a document’s image to an electronic signal that is then sent over the phone lines to another fax machine that decodes the signal.
McCue envisions facsimile machines deployed as commonly as coin-operated photocopy machines are today. Stationery stores, pharmacies and florists also are target locations for a facsimile machine, he said. Not only can they make a profit on transmitting or receiving documents for customers, but those same people then become potential impulse buyers at the store or shop.
“I love it,” said Peter Lagosz, owner of All in One Printing Co. in Irvine, referring to his Transfax machine. In addition to offering the facsimile service, some of Lagosz’s customers have used the machine to send him documents they want printed, thus saving a car trip to the shop. “It’s a timesaver and a convenience,” Lagosz said.
By either selling the machines and the marketing package outright for $3,400 or leasing them for $126 a month, McCue reckons he can keep American Transfax’s capital investment at a minimum.
American Transfax earns a profit when it sells or leases the machines, most of which are supplied by AT&T.; American Transfax is an authorized dealer for AT&T; facsimile equipment.
American Transfax stations currently charge $9 to send the first five pages and $1 for each additional page. There is a $2.50 charge for the first five pages and 50 cents for each additional page to pick up documents at another Transfax station. There are additional telephone line charges for international transmissions.
Envisions Network
McCue acknowledges that stepping beyond Orange County with American Transfax will be tough, but he envisions a network of 40,000 public machines around the nation within two years. McCue also plans a directory that will be updated monthly, listing all those fax stations. The directories will be sold to fax stations and businesses, anyone who wanted access to the public fax stations,” said Jane Summers, manager of the Orange County network.
In all, McCue figures the U.S. market can support 1 million facsimile machines by 1990, all of which will zip drawings, charts and other documents across the nation in minutes.
By carefully expanding nationally, via franchises, McCue figures he will avoid the high costs and losses that Federal Express incurred with its ZapMail service, which is scheduled to end next month. McCue says Federal Express made a tactical error in buying machines that were not compatible with those in general business use across the United States.
“It was the wrong marketing scheme and the wrong equipment,” asserted McCue. “Public stations is the concept that will work.”
Both McCue and AT&T; view the Orange County venture as the test tube for a national system.
“Orange County is probably the best test market you could have,” said Gregg Kail, Western regional manager of general business systems for AT&T; in Santa Ana. “There are more courier services here than anywhere else in the United States.”
Many of the papers now being shuttled around in vans and cars could be transmitted via fax machines, Kail said.
McCue, who was director of the Orange County Fair Housing Council from 1979 to 1982 and most recently manager of advertising sales for Laser Focus magazine, sure hopes so.
Nervously jingling coins in his pocket, McCue surveys the temporary furniture in his office, most with the tags still in place.
“Within 90 days Orange County will be on line to the world,” he said.
