While pay phones seem destined to follow the fate of LPs and drive-in movie theaters, even with the convenience and proliferation of cell phones they still grace as many corners in the city as they did when a dime could get you a local call.
Nowadays, though, that same call can set you back not just 35 cents but much, much more, as Malibu resident Khaled Karame discovered when he read his phone bill.
For a two-minute calling card call from Culver City to his company, Malibu Yellow Cab, he was charged $7.87 through a company called Opticom, the operator service provider (OSP) on the pay phone he used. On the same bill he found charges of $8.76 for a four-minute call and $7.38 for a two-minute call from Canoga Park to Malibu through another OSP called Bulletins.
“I was shocked,” said Karame. “Sometimes I get stuck, and the telephone I want to use doesn’t allow me to make 1-800 calls, so I have to use my calling card. In the past I’ve been charged 35 cents or 50 cents for those calls, but never $8. For that price, I could have taken a taxi to Malibu.”
Is it legal? Absolutely. In order to keep the pay phone business viable, the Federal Communications Commission (FCC) deregulated coin rates in 1996, which has allowed pay phone providers to operate as stand-alone, profit-motivated businesses not subject to rate regulation.
The intention, according to Lynn Milne, a representative for the Competitive Pricing Division at the FCC, was to allow pay phone providers to make a profit even if they’re set up along some lonely rural road, while at the same time promoting competition in populated areas. If the rates are too high at one telephone booth on a corner, she reasoned, a caller could walk a few feet to another pay phone with lower rates.
The FCC does, however, require every pay phone provider to post the name, address and phone number of the long distance carrier they use and to disclose the rates before a call is put through. This is a service that should not be overlooked, since the rates, as Karame knows, can be astronomical if the call is made through an operator.
Typically, an independent pay phone provider will work with an OSP (such as Opticom), which processes, bills and collects the fees for operator-assisted calls from the phone. These calls may include calling card calls, credit card calls, collect and third-party billing calls.
Commission is the key to escalating pay phone costs. Most OSPs offer the pay phone provider several billing groups to choose from. The higher the billing group’s charges, the more a customer is charged for the call and the higher the pay phone provider’s commission. Opticom’s Big Daddy Billing Group 127, for instance, charges $1.43 per minute for an initial 4-minute billing call (even if a call lasts only a minute), as well as an operator assistance charge of $7.90 and a PIF (property imposed fee) for another $3.00. For that one-minute, $16.62 call, the pay phone provider could receive a 60 percent commission of $9.97, and the FCC can’t do a thing about it.
Opticom and the Culver City pay phone provider charged Karame $1.77 for the MOU (minutes of use), $5.00 for live operator assistance and a PIF of $1.10, costing him $7.87 for his 3-minute call.
The calls through Bulletins began with a $6 initial charge (the breakdown of this charge, said Bulletin’s operator, is confidential information between the pay phone provider and the company) and 69 cents per minute. A Bulletins representative said, “The rates they are charged are exactly what the client wants to charge for whatever reasons.”
The “client” the representative spoke of is the company that actually owns the pay phone. The rep also said she was not authorized to give out the client’s name and a request for authorization to speak to the client was never answered.
Besides slipping a few coins into the phone, however, there are ways to avoid these costs by placing the call through the 1-800 number on the back of the calling card, or “dialing around” the pay phone’s OSP. By first entering an access code (10+ xxxx) before the number you want to dial, you can insure your connection through the long-distance carrier of your choice.
You may still see an additional charge on your bill since these companies must pay dial-around fees to the pay phone provider (their cost is 24 cents per call), but your bill will probably fall within reasonable limits. Phone booths owned by larger companies like AT&T, GTE or Verizon, furthermore, are usually less costly.
So if your cell phone battery has died and you have to call the Auto Club, it’s best to be prepared with an emergency calling card or your long-distance carrier’s access code–and ask for the phone rates before you put the call through.