It Seems AT&T; Has Come Up With Right Number

Not everyone is having trouble doing business in China.

AT&T;’s USA Direct service is one way the company found to avoid problems that trip up other foreign ventures.

Here’s how it works:

Suppose Xiao Wang wants to call his cousin in Los Angeles but, like most people in China, doesn’t have a phone or the means to pay for an expensive long-distance call.

Now he can go to the neighborhood phone booth and dial 10810 for access to a Chinese-speaking AT&T; operator.

Cousin Wang in America pays for the call, which would otherwise cost Xiao Wang about three days’ wages for three minutes. AT&T; receives payment in the United States for the service, sidestepping two bugbears of business in China--getting paid in foreign exchange and repatriating profits.

It took several years to set up USA Direct in China, much longer than in other countries, said AT&T; regional managing director Darryl Green. But the service is bringing in immediate profits.

The toughest part of negotiations was to convince the government-owned telephone company that AT&T; wouldn’t usurp profitable long-distance traffic but would, instead, boost phone use and bring in more foreign exchange.

“For every person who calls out of China now, 10 people call in,” Green said.

The result is a positive cycle: AT&T; settles the difference with China in foreign exchange, which the government often uses to pay for telecommunications equipment from AT&T.;

China plans to install 12 million to 15 million new telephone lines annually, the equivalent of a U.S. Baby Bell a year, and packages like this give AT&T; a competitive edge. “It’s almost like self-financing,” Green said. “Everybody wins.”

Marketing USA Direct brought a whole different set of challenges. People dislike having others pay for them, Green said, so using a Mandarin-speaking operator as an intermediary helps overcome that resistance. AT&T; ads in the United States encourage people to send special calling cards to friends and relatives in China to make it even easier to pick up the phone.

In China, AT&T; passed out 25 million bicycle fender stickers to advertise 10810; at the launch in Shanghai, it gave away free three-minute phone calls for the first 200 people to arrive. “Thousands of people showed up,” Green said.

But the first person in line was a 93-year-old scientist who once worked at Bell Labs in Princeton, N.J. He had camped out all night so he could call his brother in America. “He made the inaugural call,” Green said. “It seemed appropriate.”