Calling Up a New Range of Telephone Uses

Another miracle of the telecommunications age. For only 75 cents a minute, billed to their own phones, 100,000 Motley Crue fans nationwide could call a 900 number this fall, hear a 30-second cut from the rock group’s new album and some details of its tour schedule and leave their phone numbers on tape for a chance to win a live call from the band.

At this point, 900 service isn’t yet universally available (in California, for example, GTE California customers can’t make an intrastate 900 call). Nevertheless, there are more than a thousand 900 numbers in operation, and the service is viewed as an entrepreneurial bonanza, good for the broadcasting--at caller expense--of anything from a Motley Crue cut to current car loan rates.

“If you can hear the product,” says Andrea West, national marketing manager for AT&T;’s 900 service in Bridgewater, N.J., “you can sell it over the telephone.”

The miracle is less technical than financial. Basically, it’s “no different from (toll-free) 800 service,” says West, “but the billing’s reversed.” And unlike local 976 calls, usually limited to three minutes and $2, the company sponsoring the call sets the price.

Some 900 numbers have been available since 1980, when the presidential debate audience was invited to vote its preference for Ronald Reagan or Jimmy Carter. In 1982, the public could dial a 900 number and overhear a few minutes of conversation between NASA mission control in Houston and the astronauts in space.

But only AT&T; made much money, and the current excitement didn’t start until 1987, when AT&T; announced that it would collect fees for the 900 service entrepreneurs and subtract its own charges. Starting then, says West, “people could make money at it.”

For an “interactive” arrangement like the Motley Crue offering--part recording, part caller response--AT&T; gets 30 cents for the first minute, 25 cents for each additional minute (plus 6 cents more for a greater number of lines) and about 10% more for billing and collection. The sponsor sets the charge ($2 a minute, $2 a call, whatever) and gets what’s left after AT&T; takes its share.

About a third of the available prefixes within the 900 code have already been assigned to about 60 carriers, some of which are national (AT&T;, MCI, Sprint) and some regional (Pacific Bell, Nynex). These carriers serve the providers of information, who offer consumers the “programs,” variously informative, promotional or just titillating. Between the two, there may be “service bureaus,” which will set up the line, develop the program, handle the calls--in short, “make the phone call work,” says Brian Rivette, vice president of marketing for Call Interactive, an Omaha-based service bureau that’s a joint venture of American Express and AT&T.;

American Express has 1-900-WEATHER (75 cents a minute), offering current weather and a three-day forecast and other tourist information for any of 600 cities worldwide. There’s 1-900-339-1ABC from ABC Sports, so Monday Night Football viewers can vote (95 cents a call) for their favorite of several “best plays” in football history. There’s 1-900-USA-SWING, offering both personal ads and party-line conversations for 67 cents a minute (15-minute minimum).

Right now, says West, 93% of 900 programs are entertainment, ranging from sports polls to “chat” lines. But everyone envisions a field of lucrative business uses--employment listings, fund-raising pitches, financial quotes, product information--and all able to offer touch-tone callers a menu of messages and the ability to record information, even orders of their own.

Certainly there’s money in it, although the public carriers say (as usual) that any such monies just help them keep down the cost of basic service. Some businesses, unable or unwilling to pay for toll-free 800 lines and phone representatives, will be able to provide information not previously available by phone. Others will cancel their 800 lines or convert their local numbers and start charging consumers for what used to be free--operating instructions for new products, listings of jobs and apartments, savings account interest rates, information on real estate schemes, estimates on window blinds and kitchen cabinets.

Consumers are already paying to hear advertising matter. ABC’s Monday night 900 callers--up to 120,000 a night--also hear Frank Gifford pitch a videotape of “Monday Night Madness” for $22.95 (and are referred to an 800 line for an actual order). They may soon pay to place catalogue orders and may someday, says West, charge goods to their phone bill.

Besides giving information, 900 service providers may gather (or “capture”) information, as Electra Entertainment did when callers registered for the chance to hear from Motley Crue. Phone numbers alone can be traced to caller names and household addresses, without anyone’s knowledge or agreement, and the information can be compiled into what one service bureau calls “highly targeted lists for cross-merchandising.”

The attendant questions of privacy may weigh against the benefits of 900 service. Price is another question. With several layers of entrepreneurs involved, rates to the consumer (already known as the “end user”) will not be low. Even when there are limits set (Pacific Bell’s California 900 Service can’t exceed $20 a call), prices will surely move quickly to that maximum.

Finally, there’s some question of value, though value is hardly a requirement in merchandising. As Pacific Bell spokesman Kate Flynn points out, this is only “the start of the information age.” Perhaps it’s not surprising that with some exceptions, 900 service has started at the low end, with advertising, promotions and what passes for entertainment.

No one really knows how much customers will want from the service, but it may soon become clear, since they’re paying for it. A 900 program “won’t survive or sell,” says Jim Herold, PacBell’s director of information access services (900 and 976 numbers), “if the callers don’t perceive the value.” They just won’t call. Or they won’t call again.