GTE to Provide Quick-Connect 411 Service : Telecommunications: Phone company contracts with local cellular firms to offer directory assistance that dials number for the caller.
With characteristic quietness, GTE of California in the past few months has snapped up lucrative contracts to provide new directory-assistance services for cellular phone companies in the state.
It’s a tiny business for GTE of California in Thousand Oaks, a unit of giant GTE Corp., which is the nation’s largest independent phone company, with $20 billion in annual revenue. But operator services generally are highly profitable for local phone companies, and GTE’s new operations stand to benefit from the explosive growth of the cellular phone industry. In California, GTE won the contracts over other providers of directory services, including Pacific Bell.
The new services allow a cellular subscriber to call 411 for a phone number, then the option of being directly connected with that number. These so-called quick-connect directory services are being introduced around the country, and they save customers from having to hang up and dial the number--something thought to be particularly appealing when the caller is driving a car.
Another feature of the new cellular 411 services provided by GTE is that callers anywhere in the Los Angeles area do not have to dial an outside area code, then 555-1212, to obtain a number in a different area code. A caller in the 818 area code, for instance, could dial 411 and obtain a phone number in the 714 area code.
GTE is providing these directory-assistance services for AirTouch Communications Inc., L.A. Cellular and GTE Mobilnet, the cellular arm of GTE Corp. That means when subscribers of these cellular phone companies dial 411, a GTE operator answers and has the ability to put the call through.
GTE initially offered to provide the services to cellular operators in California and Hawaii, but is now hoping to expand the business nationwide, said Jay Burrell, product manager for wireless services at GTE Telephone Operations in Irving, Tex.
Providing new services to cellular operators is being aggressively pursued by GTE and others because the cellular phone industry is expected to grow 30% a year. What’s more, local phone companies increasingly are forced to seek new revenue sources because of regulatory and pricing changes in their traditional business, and the likely opening of local phone markets to competition from cable TV and long-distance phone companies.
Providing new services to cellular phone companies “is such a natural fit” for GTE, said Burrell. “We’re spending a great deal of effort to be the best out there.”
Other 411 services that might soon be offered include theater listings and directions to certain destinations, Burrell said. Also in the near future, GTE plans to provide all these services in Spanish.
The directory-services business has “pretty good growth prospects,” said analyst Robert B. Wilkes at Brown Brothers Harriman in New York. Witness, he said, the announcement earlier this month by long-distance phone company MCI Communications Inc. of its new service allowing callers to dial a single toll-free number to find just about any published phone number in the United States or overseas. MCI will also offer to automatically dial the number for no extra charge.
But 90% of directory-assistance calls are for local numbers. And that business stands to expand with the increasing use of cellular phones.
The first local cellular company to go on-line with the new 411 services was GTE Mobilnet, which debuted the services in April in its California markets, including five area codes in central and Northern California. All cellular callers to 411 are now automatically connected to the numbers for 60 cents per call. A regular 25-cent directory-assistance call without the direct-connection feature now requires dialing a number other than 411.
David Avirom, marketing manager for GTE Mobilnet in California, said that, although GTE is providing the new services for its cellular arm, bids from other companies were also considered. Avirom said that usage of the call completion feature among cellular subscribers so far is nearly 100%.
AirTouch began its new 411 services in the Los Angeles area in June. GTE has in the past provided 411 services for AirTouch within the local calling areas that GTE serves. But “this is a very different animal than what we did before,” said Melissa May, an AirTouch spokeswoman. The changes required “a whole new contract” with GTE.
Although AirTouch was spun off in April from the parent of Pacific Bell, May said AirTouch chose GTE for the new services over a competing bid from Pacific Bell because GTE offered “better service at a better price.”
An AirTouch 411 call costs 33 cents, and if the customer pushes a button to be automatically dialed through, there is no additional charge. The new services are in effect throughout Los Angeles, Orange, Ventura, San Bernardino and Riverside counties. The company hopes to expand them statewide in early 1995, at which time a cellular customer could call 411 for a number anywhere in California.
Pacific Bell previously provided L.A. Cellular’s 411 services, said Mike Cymbrowsky, senior marketing manager for L.A. Cellular. But earlier this month, under a new contract with GTE, L.A. Cellular also began offering customers the ability to make a 25-cent 411 call, and for an additional 50 cents be connected with the number.
A customer need only dial 411 for any number in the company’s service area of Los Angeles, Orange, San Bernardino and Riverside counties.
GTE’s Burrell wouldn’t say, but it’s a good bet that GTE is also hoping to win a contract to provide similar services to the remaining major cellular phone company in the state. McCaw Cellular Communications Inc., which operates in various parts of California as Cellular One, is planning to add new directory services within the next several months, said Sylvia Schnopp, marketing coordinator for Cellular One’s south coast district.
