Prepaid Calling Card Study Part 2 - On The News

Here is part two of the Univision report on phone cards.

Prepaid Calling Card Study Part 1 - On The News

Recently Univision aired a two part feature story on the phone card business. I'm sorry but this video is in Spanish only.

NY Coucilman Pushes for Probe on Prepaid Cards

The latest political figure to jump on the crack down on phone cards movement is Democratic councilman Eric Gioia form Queens. While not as high profile as some of the other political figures involved in this movement, it shows clearly that this movement is gaining momentum and will be an issue on many government officials desks in the coming year.

In this case Gioia is bothered by the fact that many cards don't deliver the advertised minutes and are delivering confusing messages on their disclaimers resulting in consumer confusion. He has vowed to bring this issue to the Department of Consumer Affairs and State Attorney General Andrew Cuomo.

To read the full release click here.

Federal Trade Commission Takes on Clifton Telecard Alliance

Well it looks like Clifton Telecard Alliance (CTA) is being chased down by the Federal Trade Commission (FTC) for the misrepresentation of the number of calling minutes consumers get on their cards. CTA seems to be have been singled out in this particular case due to it's size and dominance in the calling card market with the FTC claiming CTA had sales of $28 million alone in just the last quarter of 2007.

The FTC cite one card which was supposed to deliver 40 minutes of calling time to El Salvador (according to the poster) and cut the call off after only 27 minutes. In all the FTC purchased 46 different CTA cards and claim none of the cards delivered the total advertised minutes.

The FTC has asked that the court demand that the company halt these practices while the case awaits trial and they have also asked for a court appointed monitor to oversee the business to make sure the process doesn't continue. The trial date has yet to be set but the FTC is trying to do as much in their power to curb this companies practices even before their day in court.

Unfortunately I don't think CTA is the one mandating the number of minutes given on a card! All distributors would love to have cards that deliver the true amount of minutes (although insanely high) but the carriers are the ones who play the games.

Just a warning to all phone card providers and distributors this is probably the first of many of these types of suits. The movement in Washington is to crack down on the calling card companies deceptive minute practices and is in large part thanks to the heavy lobbying IDT has undertaken as of late to clean up their business!

Here is a link to the The full FTC complaint against CTA

Phone Card Commercial for Cabal

IDT Spanish language phone card commercial.

Company Profile: CVT Prepaid Solutions

CVT Prepaid Solutions, Inc.

Founded: 1997
Ticker Symbol: N/A (Privately Held Company)
Employees: 60
Location: Great Neck, NY
CEO: Michael (Mike) Acevedo
Fiscal 2007 Sales: $8.2 Million


Timeline:

1997: Founded by former CEO Peter Sicilian under the company name of Orion Telecommunications (OTC).

2001: Performs significant build out of their back end network with the help of Verso Technologies equipment (NACT switching technology).

2004: Citing the inability to handle the volume of sales properly, OTC files for Chapter 11 Bankruptcy protection (http://bankrupt.com/misc/orionconvert.pdf).

2005 (April): Company unveils it's 100 day back-on-track program after emergence from Chapter 11 bankruptcy protection.



2005 (May): company is one of the first in the US to start issuing die cut phone cards with special themed shapes. The first such card was the Mexico Futbol card shaped in the form of a soccer jersey


2005 (August): Company changes name to CVT Prepaid Solutions, Inc. names new CEO Mike Acevedo and moves it's headquarters from Bayside NY to Great Neck NY.

2007: CVT, one of many companies, is sued by IDT Telecom and Union Telecard Alliance for unfair fraudulent practices. They first stand hard, issuing an open letter to the industry denouncing this lawsuit but later in the year agree to a private settlement on the lawsuit.

Sources:
http://phx.corporate-ir.net/phoenix.zhtml?c=105061&p=irol-newsArticle&ID=213901&highlight=
http://www.allbusiness.com/company-activities-management/product-management/5140609-1.html
http://biz.yahoo.com/ic/109/109764.html
http://www.cvtprepaid.com/about/presskit.asp
http://news.moneycentral.msn.com/ticker/article.aspx?symbol=US:IDT&feed=PR&date=20071129&id=7873005
http://www.businessweek.com/magazine/content/07_30/b4043079.htm

Virgin Mobile Falls Way Short of 4th Quarter Subscriber Goals!

A little over a year after going public, Virgin Mobile continues to perform poorly. In their 4th quarter they added 209,669 net subscribers far short of their 400,000 estimate. The company also signaled that their Q1 net subscriber adds will continue to be poor, sighting the poor economy and less disposable income.

The news was not taken well by Wall Street, with a huge dip in the stock price! The stock fell by over $2 a share after this announcement, from a little over $4 to just over $2. A far cry from their $15 plus price of 6 months ago. To be fair this trend seems to be common in the telecommunications sector with other Telco companies like Sprint, IDT, and Verizon also falling on tough times.

US Economy Continues to Tank! What Will This Do To The Phone Card Business?

As we creep closer and closer to a full blown recession most analysts believe that consumer spending will decline significantly, hitting non essential goods providers the hardest. The question that I get asked frequently is how will this affect the prepaid phone card business?

Phone cards are not technically classified as an essential item, but at the same time they serve a need that does not disappear just because times are bad. The need to talk to your family and friends abroad is always there it just might happen less frequently as a result. So the customer who used to call his mother 7 times a week now might only call 2 or 3 times a week to keep his costs down.

The reduction in usage is not welcome news to an industry already on hard times but will just force those still left in this business to run more efficiently or be forced out! Mergers and banruptcies will become more common and a landscape of only a handful of players is likely to emerge. The bigger companies like IDT, Ibasis, STI, and Locus will probably survive, albeit smaller, and most of the mom an pop providers will disappear. Distribution will also change, with many of the independent distributors leaving and a new distribution group coming in to scrape up the auxiliary business (larger one stop convenience store distribution companies will pick up phone cards).

While this is just my opinion, I still think whatever the path this recession takes, the phone card business will emerge as an industry far different than we have known.

Featured Online Phone Card Store: nobelcom.com

Nobelcom.com

If you are a regular seller or buyer of phone cards online you are no doubt familiar with the calling card store called nobelcom.com. Online since November 2002 nobelcom.com has been a dominant force in the online retail space with cards like Long Call World and Most Minutes World. Owned and operated by Thomas Knobel of NobelTel, Ltd, this company has quickly become the leader in the international phone card market. Their position as a global carrier helps them offer some of the lowest rate phone cards out there today.

Just about all of the phone cards on their site are fully rechargeable, reducing the need to have to remember a new pin number every time you need a new card.

NobelTel, Ltd headquarters is located in Hamilton Bermuda and also sells prepaid long distance phone service through it's Enjoy Prepaid brand and post paid long distance service through it's NobelTalk brand. The company also maintains a strong carrier wholesale business which helps them support their extensive retail offering while keeping their rates low.

Traditional Telco Decline

If you look at the stock market performance over the last year you will see an alarming trend among traditional pure telco providers. Companies like IDT, Level3, Ibasis, and even Qwest have seen dramatic reductions in their overall stock prices.

>>IDT went from around $11.20 a share in March of 07 to roughly $3.70 a share in March 2008

>>Level3 went from around $6.20 a share in March of 07 to roughly $1.83 a share in March 2008

>>Ibasis went from around $10.00 a share in March of 07 to roughly $3.75 a share in March 2008

>>Qwest went from around $8.70 a share in March of 07 to roughly $5.09 a share in March 2008

This trend is no doubt not a coincidence and is reflective of these companies poor performances financially and a sign of the changing industry. Unless you are a Telco provider offering a mobile service like Verizon, Sprint and others, your business is not part of the future of Telecommunications. Analysts see mobile as the future and are not impressed by anything a traditional player can come up with... Even VOIP providers like Vonage and Packet8 are seen as yesterdays technology and not collecting much on the trading floor.

I have a feeling we will be seeing a lot of consolodation going on amoungst these traditional Teleco's in the coming months and years. It is the only way they will be able to continue as market share keeps dropping.

Jackpot Phone Card TV Commercial

Funny commercial by Telecard Network.

Hi Connect Phone Card Commercial

A card that I never heard of before but the commercial seems to be of good quality and thus worth listing here.

Maine to Vote on Phone Card Bill Wednesday

The first state to take an active vote on a legislation affecting the way calling card companies operate is going to be Maine. On Wednesday the house will vote whether to adopt this new bill or not!

The bill is mostly the result of the recent AT&T inter-state rate increase fiasco and will do the following:

Force phone card providers to deliver all of the minutes they were promised
Provide ample notice when rate increases are to go into effect
Not increase rates on cards that were bought under the promise of the old rate (I don't know how they will enforce this).

Surprisingly the bill has met little opposition from outside parties like Telecom companies!

Read the full article here

Lisa Brown Now With The Prepaid Press

For the last year or so I noticed that Lisa Brown's name was absent from any of the Intelecard materials I receive in the mail or on the web. She had been one of the major faces of the Intelecard publication and Expo for years but I just assumed she either was still with the company in another role or had left for something else.

Well to my surprise I received an email yesterday from the Prepaid Press promoting their upcoming Las Vegas expos and whose name was on the email... Lisa Brown.

Looks like she jumped from that sinking ship and is now the expo coordinator for the Prepaid Press. I can't say I blame her, the Prepaid Press has been putting out a quality publication lately and Intelecard has fallen flat on their face, with a website that looks like it was programmed by my 5 year old, no more magazine and having to resort to having an expo in Edison NJ instead of sunny Miami.

Interesting Article on How Mobile Phones Have Changed Telecom

I came across a Washington Post article by Joe Brancatelli recently which I found to be a good take on how the Mobile phone has changed the average business traveler's life for the better. While this article is written from the business traveler's perspective, the case holds true for average Americans as well.

With the new unlimited plans just coming out from all of the major US cell phone providers (at&t, Sprint and Verizon), the marketplace is sure to move towards mobile even further than it already has! It won't be long until we see world plans just like the VOIP providers are offering.

You can read the full Washington post article here: Phoning Home

Blackstone Signs Distribution Agreement with Freedom Wireless

Blackstone Calling Cards, Inc. will now be distributing Freedom Wireless phones, branded as Zebra Unlimited and Zebra Everywhere. Freedom Wireless, a US based MVNO, hope to utilize Blackstone's extensive calling card distribution channel and advanced point of sale technology to help them expand their customer base. the view is that this will help gain a larger market recognition for Freedom Wireless brands and help tap into new markets that Blackstone has at it's fingertips.

According to Freedom Wireless:

"customers will enjoy the convenience of an unlimited long distance, flat rate GSM cell phone plan, that is economical and has great coverage without the worry of leaving your immediate calling coverage area or unanticipated high monthly bills. Zebra Unlimited prepaid SIM's allow customers to pay a flat rate monthly amount on unlocked GSM cell phones for as low as $40 per month. Additionally, Zebra Everywhere offers value-priced per-minute plans in the 50 United States and Canada. Zebra prepaid brands require no annual contract and no credit check."

According to Blackstone, the phones should start being available in April this year.

The full press release can be seen here

Comercial Cabal Phone Card

A commercial for an idt phone card called Cabal.

Howard Jonas "Jew of the Day"

No this is not some anti Semitic post, there is an interesting article out there where Howard Jonas is the called "Jew of the Day"

http://www.jewoftheday.com/categories/culture/Jonas%20Howard.htm

The article basically touts his work and support of the Jewish community and gives you a feel for just how Jewish IDT is as a company, talking about the Kosher cafeteria, the synagogue on site and it's orthodox employee base.

Not really news but the name of the site caught my attention and the background it gives you on Jonas is insightful and on point.

Skype Sues PennyTalk Calling Card for Patent infringement

In one of the most ridiculous things I have seen recently, eBay, the parent company of Skype, has sued IDT over a claimed patent infringement on the PennyTalk calling card. While no details of the lawsuit were released other than PennyTalk is using a 2000 patent of theirs for a "long distance telephone communications system."

Now if I am correct PennyTalk is just a prepaid calling card, which is the most basic form of telecommunications service... does Skype have a patent on calling cards?

This just smells of abuse of our legal system and is no doubt a tit fo tat retaliatory lawsuit to get revenge on IDT for suing Skype for a VOIP patent infringement issue. While I don't know much about the IDT lawsuit against Skype, I do know that if anyone can claim ownership of VOIP patents, it is IDTs Net2Phone group who was one of the founding fathers of the VOIP business but I can guarantee you that Skype claiming it has patents in the calling card market is just plain ridiculous!

To read the brief announcement click here

Tarjeta Talk Commercial

Commercial for the Talk phone card from PT1.

Oblio Goes Back to SmartTalk for Calling Card Service

Oblio has come full circle, announcing that they will now be using Smartalk again for all of it's prepaid phone cards. Oblio had been with Smartalk for most of the first half of this decade but then left for Sprint, with whom they partnered to be able to expand their prepaid mobile business. While it is not clear if Sprint shut them down or that Oblio was just unhappy with the service, Smartalk will now be the provider of choice going forward.

If hindsight is 20/20 then they are probably thinking they should not have left for Sprint in the first place.

It looks as if Oblio and it's parent company Titan Global Holdings are at least trying to turn around the business and bring it back on course but unfortunately there has been too much damage to consumer confidence and distributor relationships to be able to solve the problems just by switching carriers... might be too little too late!

Speedypin.com Sold to NewWest Capital Partners

Speedypin LLC, one of the oldest phone card websites online (founded in 1997), announced that they have sold off the assets of their business to Denver Colorado based NewWest Capital Partners. The financials of the deal have not been disclosed nor is it clear if the existing management of speedypin.com will remain on with the company.

Speedy pin is also known as 1st USA.com Phonecards, Inc

speedypin.com & New West

The full press release can be seen here

Titan Global Announces that Counterfeit Cards are in the Market

In what has seemingly been a long couple of months for Oblio distributors, Titan Global Holdings, in what appears to be a bold PR move, announced yesterday that there are a slew of counterfeit Oblio branded cards in the market and will be replacing any unused cards for all distributors or retailers with such cards. They also claim that they are pursuing legal action against the alleged counterfeiters in Texas courts. In a press release on the Center Dialy Times, they claim that a former employee of Oblio and several outside distributors worked on their own against the companies knowledge and as a result created these counterfit products. They are pursuing a Racketeer Influenced and Corrupt Organizations (R.I.C.O.) Act case against these individuals.

While I have no way of verifying if Titan's claim is true or not, it just seems to me as if they are using this claim of counterfeiting to cover up some bad business practices on their end. Their cards have not been working properly for months now and only this week they announce it is because of counterfeit cards on the market????

Who knows it could very well be true and the courts will be deciding this some day soon but I just have my doubts!

To tell if your cards are possible counterfit they say... "Unless the customer service number is 800-394-4868, it is counterfeit, suspended, or expired."

**The views above are my own personal opinions...

Click Phone Card Commercial - Entrix

Here is another Spanish language commercial for the Click phone card from Entrix.

Howard Jonas Issues White Paper on Future of IDT

In a surprising move, after much silence, Howard Jonas officialy released a white paper on the current status of IDT and his views on the future direction of the company. Mainly written to address the investors concerns over recent performance, Jonas lays out why he feels IDT is performing better than the numbers indicate, blaming the shortcomings of the GAAP accounting principals for the bad overall financial picture. He claims that because of GAAP, things like training, process improvements and advertising are listed as operating expenses and not as investments in the future of the business.

The second half of the white paper lays out his vision for the future of IDT as a business and judging by the lack of any mention, Telecom does not seem to be viewed as a significant part of IDTs long term vision.

Mr Jonas points to businesses like Zedge, an online community portal, IDT Carmel, a receivables management group and it's recent Oil Shale business aquistion as the companies shinning stars. Interestingly he also mentioned another business called Depot USA which will be an online store that only sells goods made in the USA.

You can read the full white paper here

Ibasis Q4 Earnings Transcript

I was reading through the Ibasis earnings transcript today and two things caught my eye:

1) Their phone card business, like everyone else's is declining rapidly: "Our retail business consist of our retail prepaid calling card business and our Pingo eCommerce business. Revenue from our retail business in Q4 was $24.8 million compared to $32 million in Q3." They try and spin it and claim it to be the result of the cleaning up of the prepaid business... they offer clean cards now and others don't putting them at an unfair playing field.

2) Ofer Gneezy said that they anticipate 2008 to be a big year: "We said we believe 2008 will a pivotal year in the evolution of iBasis and perhaps in the evolution of the international voice business over all. " and also later goes on to say: "In addition, we believe that with our scale efficiency and focus on international voice, iBasis is perhaps uniquely positioned to lead the consolidation of this segment of the Global Telecommunications Industry." Is there something in the works here? We know they just merged with KPN but the statement above raises questions like will they be pursuing other company acquistions as well? Consolidation in the telecom business is already underway but it would suprise me if Ibasis had enough capital to be the one doing the aquiring ...

Read the Full Transcript

La Sexy Phone Card Commercial

Another Spanish language phone card commercial for the Sexy phone card by 9278. Combines two things that everyone guy loves, hot women and Baseball.

Interesting Oblio Telecom Press Release

Titan Global Holdings issued a press release on Tuesday describing the problems they were having with their telecom division Oblio. It's interestting to see their take on why they think things are bad! Here is a quote from the press release that basically makes it look like their distributors are the ones who are screwing them not the other way around:

"Subsequent to the three months ended November 30, 2007, the Company's communications division experienced a significant decrease in sales and collections of outstanding accounts receivable. Many of the long-standing distributors of the Company's wholly owned subsidiary Oblio Telecom's products stopped placing orders for new product and stopped sending payments for previously placed orders. While we are vigorously pursuing legal action against many of these customers, the extended collection process has significantly disrupted the operating cash flow cycle of the prepaid international long distance portion of the Company's communication's division. These issues along with losses experienced in its network operations have resulted in the Company ceasing to do business as Oblio in the prepaid international long distance market. As such the Company evaluated the division's goodwill and other intangible assets for impairment based on changes in the business model. Based on the determination of management, the Company impaired the goodwill and certain intangible assets of Oblio."

So I guess they are trying to say that all of the distributors got together and just make a pact to not pay Oblio for their cards... yeah right! They also announced that they have given up the prepaid wireless business.

Read the full Titan Global Press Release

Company Profile: Oblio Telecom

Oblio Telecom

Founded: 1995
Ticker Symbol: N/A (now owned by Titan Global Holdings trading under symbol TTGLE.OB)
Employees: 40
Locations: Richardson, Texas

Timeline

1996: Sammy Jibrin and Radu Achiriloaie open the business
2000: Land deal with AT&T to provide their back end service for all of their phone cards via the Smartalk brand.
2005: Taken over by Titan Global Holdings, Inc in exchange for stock which was later returned to Titan since the taxes would have been more than the profits. A loan was later issued that was not required to be paid back... full story - Oblio also launches it's prepaid mobile product Bravo
2006: Oblio switches it's back end provider for their phone cards to Sprint and leaves long time provider Smartalk.
2007: Oblio Telecom is name to Intelecard's 10 to Watch list (everyone knows this is the kiss of death). Oblio receives 4 million dollars back from IRS for past Federal Excise Tax payments.
2008: Oblio Phone Cards start giving much lower than advertised minutes

Other Sources:
http://www.wirelessdealermagazine.com/spring07/Downloads/pdf64-65.pdf
http://www.obliotel.com/
http://www.herdonthestreet.com/protected/Research%20Reports/TTGL%20Initiation%20Report.pdf

Using Phone Cards in Iraq - The Only Way to Call Home?

I see tons of press releases out there about groups sending over phone cards to the troops in Iraq to help them call home and always wondered if people really understood the "phone" situation over there. To help calrify, here are a few hings you should know:

1) Some Military bases have AT&T pay phones installed and allow for the use of calling cards but beware the cards won't deliver the promissed minutes because they will incur a pay phone fee and if it is a non AT&T calling card will incur at least another $1.50 network access fee. These fees come off the balance of the card, resulting in less minutes. I have even heard reports that some of the pay phones block acess to other non AT&T 800 numbers.

2) Some Morale, Welfare and Recreation posts actualy offer VOIP Phone calling and the costs can be much better than phone cards but they are harder to come bye and subject to more "lag" and quality degradation based on the internet signal strength.

3) Government DSN phones are also available in some places where a soldier connects directly to an operator who connects him/her to the party of their hoice. The rates are similar to that of calling from your home phone in the US.

4) Iraq cell phones are also available locally to the troops but you must buy them off base. From what I hear the coverage is ok but the rates are somewhat more expensive.

5) Last but not least are sat phones which are not as plentiful but they deffinately are useful in the more remote bases in Iraq where the amenities are not as plentiful.

Long story short, consult with your loved one over there and see which one of the above options is best for them and see if you can help them out in another way. Sometimes a phone card may be the best choice but other times more practical and economical methods are available.

PT1 Talk Phone Card Commercial

Spanish language phone card commercial for the Talk phone card by PT1

Proposed Changes to USF

Regulators are working on proposals that would change the way the old Universal Service Fund tax is dispersed. The changes propsed center around the distribution of the funds collected. Today all customers pay into this universal service fund and the money is then redistributed to smaller telcos in rural areas.

Porposed Changes:

1) Allowing Broadband and other smaller Telcos a portion of the funds

2) Creating a seperate fund for wireless operators

3) Changing to distribution based on cost and share of business not just equal for everybody and also giving funds to company who proposes the lowest bid for offering services to promote a more competitive environment.

The changes will most likely be open to more discussion and possible alterations but should go into effect sometime in the coming year or so!

Titan Global Holdings Restructures Phone Card and Wirless Groups

Titan Global Holdings, Inc., the parent company for Oblio Telecom Inc., announced yesterday that it was restructuring their Telecom units and getting out of the leased and owned network business and choosing instead to just focus on their core Distribution and Marketing strengths.

It has not been announced who will take over their switching operations (if anyone) or who Oblio will buy it's network services from instead, but it is certain that Oblio and Titan Wireless will now just go back to their original reseller business.

View full report

IDT Aquires Contoling Interest in EGL Oil Shale

If you needed more proof that IDT was looking outside of Telecom for it's future, today's news that IDT has aquired a 75% stake in EGL Oil should solidify IDT's strategy intentions.

EGL, a subsidiary of the private oil and gas company EGL Resources Inc., is 1 of 3 companies with a 10-year lease granted by the U.S. Bureau of Land Management to explore the potential for commercial oil shale production in western Colorado.

The financial details of this transaction have yet to be released.

CrossFone Supercanal Coomercial from Argentina

Argentina phone card commercial

Company Background: IDT Corporation

IDT Corporation

Incorporated: 1990 as International Discount Telecommunications Corporation
Ticker Symbol: IDT
Employees: 2,360
Locations: Newark NJ, Piscataway NJ, Long Island NY, London UK, Argentina, Uruaguay, Peru, Chile, Brazil, Hong Kong, Singapore, India, Japan, Philippines, Australia and other small offices worldwide

Timeline
1990: Starts company, International Discount Telecommunications Corporation, by offering callback services to international clients
1992: Company moves into Hackensack NJ headquarters building
1993: Gets into the carrier wholesale business
1994: Offers Dial-Up Internet access
1995: Company is renamed IDT Corporation
1996: IDT goes public
1997: IDT starts the business unit Net2Phone
1998: UTA, a joint venture with Carlos Gomez, is formed and IDT kicks it's sales of phone cards into high gear
1999: IDT has its first profitable year & spins off Net2Phone as a separate company and IDT relocates it's headquarters to Newark NJ
2000: AT&T buy up shares of Net2Phone for 1.1 billion dollars
2001: IDT buys back Net2Phone shares from AT&T for 92 million dollars and buys Talk America radio syndication network for $3 million... also buys PT-1 rights for 26.3 million
2002: IDT buys Winstar from Bankruptcy court for 42.5 million in cash and stock and creates IDT Entertainment
2004: IDT Energy is formed
2005: IDT buys mobile sharing company Zedge.net and forms new Internet mobile group and also launches TUYO Mobile a prepaid MVNO geared towards Latin American community
2006: IDT buys out all remaining Net2Phone shares and brings it on as a division of IDT & sells IDT Entertainment to Liberty Media, also creates company IDTJets and buys Spanish grocery company Vitarroz
2007: IDT files an anti-trust lawsuit against all of it's main calling card practices claiming deceptive business practices from these companies are hurting the calling card business and sells it's Toucan service and also aquires IDW Publishing

Sources:
http://milo.digitalentropy.com/projects/onaroll/ch14/10.html
http://finance.yahoo.com/q?s=IDT
http://www.fundinguniverse.com/company-histories/IDT-Corporation-Company-History.html
http://www.hispanicprwire.com/news.php?l=in&id=4801&cha=12
http://google.brand.edgar-online.com/EFX_dll/EDGARpro.dll?FetchFilingHTML1?SessionID=RDFQWN0wLt8W7zB&ID=5476635-187215-322877

Do We Really Need Three Trade Shows a Year?

I was flipping through the pages of the most recent issue of the prepaid press and they are heavily promoting their very first trade show, the tppEXPO'08, to be held in Las Vegas from August 19th to August 21st of this year. There are still very details available about the show like who will be speaking and who will be sponsoring but you can keep up with the developments at the prepaid press expo website.

While I understand their motives, unseating the Intelecard folks from their domination, I just feel like this extra expo is a little odd considering we are in a fast shrinking business and should actually be looking to reduce the amount of trade shows not increase them. This extra trade show will only dilute each shows importance. I would rather have 1 big show a year where I know everyone will attend, rather than three shows where people will selectively attend.

The other strange thing here is why not pick a different venue than Vegas? Intelecard will be throwing their Expo there a month or two later... do you think people are going to want to go out to Vegas twice in two months? I for one would be too broke from the first trip!

How Many Prepaid Phone Cards Deliver Full Minutes?

In a recent study conducted by the Hispanic Institute and published in many major newspapers, 45 different phone cards were selected from a variety of companies and tested to see which ones delivered the advertised minutes. To no suprise, only one third of the cards delivered the real minutes and 7 of the cards didn't work at all. In fact 8 of the cards tested delivered less than 50% of the advertised minutes.

The cards that were tested included the following:

• Florida ($5)  Telmex Compaqero, STI Florida, Touch-Tel Hondureqa, Touch-Tel Guatemalteca, Touch-Tel Salvadoreqa, Dollar Phone Coffee Time, Dollar Phone Rey, MPTAFlorida Idol, MPTA Nine, PCI Pilot, PCI Prima and TST Si Pues
• New York ($2)  Diamond Bingo, Diamond Arenque, SDI I Love NY, Lycatel Success, Lycatel Call Me, STI World, RTG Martini, RTG Cocktail and IDT Play Ball.
• Washington, DC ($2)  IDT Boss
• Toll Free ($5)  GEO Florida

You can read the full article here

NJ General Assembly Approves Phone Card Bill S2887

New Jersey now joins Florida and New York state in the battle against the corrupt practices of the calling card industry. Senate President Richard Cody introduced Bill S2887 that would require all minutes for any phone card be available to the customer with no limitation other than deductions for allowed fees and taxes and no expiration unless clearly disclosed on the card or packaging, and advertising. Strict guidelines would have to be followed by the calling card companies in order to remain in compliance.

This bill also goes further than just targeting the phone card providers, it also targets retailers, who could be fined for knowingly selling phone cards that do not deliver "true" minutes.

The bill still requires the Governors signature and if signed by him, would take another 7 months until it takes effect.

The full article can be viewed here

Entrix Commercial for Mi Pueblo - TCN

Spanish language commercial from Telecard Network.

AT&T Go Phone Now Offers Roaming in Mexico

In an effort to better align themselves in the Mexican American market, AT&T announced that their prepaid mobile brand, GoPhone, will now allow it's users to use their phones while traveling in Mexico. The odd thing here is that they will be charging their customers $0.99 a minute for all calls made while in Mexico making renting a mobile phone in Mexico a much more cost effective option especially for heavy users. Nevertheless, it is still a good option to have for those traveling to Mexico... good job AT&T!

Union Telecard Alliance Manages VITARROZ Food Brand

I don't know if this is old news but I just learned that Union Telecard Alliance (UTA), IDT's calling card distribution company is now also managing their ethnic food service business, which includes the Hispanic food brand Vitarroz. I knew that IDT owned this company but it must be recently that they gave the management of this business over to UTA. So now you can buy phone cards and some sugar ridden orange soda at the same time :)

I suppose it makes sense considering the bulk of UTAs success comes with the Hispanic community but it seems like a little bit of a stretch for them to also try and sell grocery items.

InteleCard Expo to be Held in Edison NJ

Like most of you, I have been receiving tons of emails from InteleCard informing me about the spring expo to be held for the first time in New Jersey. While this is old news now, the actual city location is new... The expo is being held in Edison NJ which is just south of Newark. Kind of an odd location considering a lot of the prepaid companies are a little further north in NJ. I would have thought they would be doing it somewhere closer to Manhattan like Secaucus...

This show should be interesting for those of us from the North East!

New Year and New Commercials - La Leyenda from IDT

Here is a Spanish language commercial for an IDT phone card.

It's 2008!

Happy New Year Everyone!

your friends at phonecardmania.blogspot.com

Florida Public Service Commission Issues Consumer Warning on Prepaid Phone Cards

In another move against the prepaid phone card business, the Florida Public Service Commission issued a consumer warning on phone cards. The report urges buyers to beware of many prepaid phone cards which have been found to be misleading consumers and acting in ways against that of Florida public statures. These problems include:

- Some of the phone cards didn't work at all
- Some of the phone card companies were not registered with the Public Service Commission as required
- Extra unadvertised surcharges and card limitations were not always disclosed
- Access numbers for some cards' networks were continuously busy
- Some phone cards advertised no connection fees, yet charged disconnection fees, misleading consumers
- Advertised per-minute rate on some cards applied only one call. Additional calls were charged at a significantly higher rate. Also, advertised rates, in some cases, applied only to limited areas, which was not disclosed

Florida has become one of the most active states in the battle against prepaid phone cards and their questionable practices (following the Florida Attorney General warning earlier this year).

See the full article here at Florida Today

Phone Card Commercial - Week 25

A very strange but clever phone card commercial from argentina for a phone card by Convergia.

MySpace and Skype Partner

In one of the more common sense deals in the telecommunications industry, Skype has agreed to partner with MySpace to empower their huge social community to make voice calls. MySpace will be introducing a new IM client that will also have the Skype engine built in. The service has been launched in beta and should be available to the masses in early 2008.

A great move for Skype as it will allow them to tap into a new market of social community users, mostly here in the US , an area where they are extremely weak. For those of us in prepaid, we really don't have much to worry about as this youth market was not big on prepaid calling cards in the first place, so our markets should not be eroded any further by this deal. It may have a small effect on prepaid mobile consumption but I don't think anything of note... young people just love to talk on the phone anyways so I think they will just end up talking more!

Canadian Prepaid Wireless Market

Not to leave our friends north of the border out I decided to write this next post on the Canadian prepaid wireless industry.

Prepaid Mobile Demographics in Canada:

• Total mobile phone subscribers = 17 million
• Percentage that are prepaid subsribers = 29% (double that of the US market at 15%)
• Prepaid mobile growth = the market saw it's largest growth in the early half of the decade with double digit percentages in 2003 and 2004
• Future prepaid mobile growth = The market has reached it's peak and growth is small (less than 1% growth per year) where as the US market has larger growth forecasts.
• Prepaid mobile has a 15% penetration in the total population
• Prepaid mobile brings in roughly 421 million per year in Canada

Provider Market Share:

• Rogers Wireless has 39% of the prepaid market in Canada
• Bell Wireless Alliance holds 36% of the prepaid market
• Teleus Mobility has 22% of the prepaid market
• Aliant Mobility has 2% of the market

Conclusion:

The prepaid market in Canada has matured and peaked at a much faster rate in Canada than in the US and growth, while small, is still going to be happening well into the next decade. Canadians have embraced prepaid more than the US market due to their lower average incomes and necessary expenditure controls.

Statistics are courtesy of http://www.sfu.ca/cprost/prepaid/early.htm

International Calling Destinations on US Phone Cards

While not the most up to date information (the numbers are from 2004), the following data still remains fairly indicative of the current market:

Breakdown by Continent:

• North and Central America = 30% (this has no doubt decreased since 04)
• South America = 19% (this has no doubt increased since 04)
• Western Europe = 13%
• Asia = 10%
• Eastern Europe = 7%
• Caribbean = 6%
• Africa = 6%
• Other = 9%

Breakdown Of Minutes Made Using US Calling Cards by Country:

• Mexico 2,033.3 million minutes
• Canada 948.9 million minutes
• Columbia 801.3 million minutes
• Brazil 629.6 million minutes
• UK 489.5 million minutes
• Dominican Republic 489.0 million minutes
• El Salvador 406.7 million minutes
• Guatemala 361.5 million minutes
• India 331.4 million minutes
• Germany 293.7 million minutes

Phone Card Commercial - Week 24

Commercial in Spanish for an IDT Phone Card.

Virgin Mobile USA Faces Class Action Lawsuit

Having just gone public in October of this year, Virgin Mobile USA now faces a class action lawsuit from many of it's shareholders who are extremely disappointed with the poor performance of the stock. The lawsuit alleges that Virgin Mobile USA withheld many actual losses prior to it's IPO and as a result mislead investors into believing the stock was worth more than it actually should have been.

The stock, when first made public in October, was trading at around $15 and now less than two months later it is trading at almost half of it's original value, last trading at $7.28.

Unfortunately this seems to be a trend with many telecommunications companies in recent years, going out high and quickly falling. Vonage went through the same trend when it came out last year. Hopefully this is not an omen for the industry as a whole!

CVT Prepaid Solutions Settles Lawsuit with IDT

In a private settlement reached this week, CVT Prepaid Solutions, the most outspoken company against this lawsuit, surprisingly agreed to adhere to the "true minute" program that IDT is pushing. While no details of the settlement were revealed, it is estimated that CVT will join Locus, Dollar Phone, Epana and others who have already agreed in principal to follow ethical marketing practices and promising to deliver actual advertised minutes.

To see the full article go to CNN.com

Happy Thanksgiving!

Happy Thanksgiving Everyone!

Your Friends at phonecardmania.blogspot.com

Phone Card Commercial - Week 23

A Spanish language commercial for the Hi-Connect prepaid phone card. Not sure if this is just an online card or also available at retail outlets.

Some Demographic Data of Interest to Phone Card Providers

I came across some interesting demographic data on foreign born immigration to the US that I though might be interesting to people in the phone card business:

2005 Statistics

* Foreign Born Population of the US represents: 12.4% of the countries total population
* 53.5% of Foreign born peoples come from Latin America, followed by 26.7% from Asia, 13.6% from Europe, and 3.5% from Africa.
* 30.7% of foreign born people came from Mexico, followed by 4.9% from China and 4.5% from the Philippines.
* The amount of foreign born Mexicans in the United States is actually decreasing... went from 3,784,835 in the 90s to 2,796,118 in this decade (granted the decade isn't over but in total % wise of total immigrants, there is definitely a decrease)

To view the source of these statistics and other interesting stats please visit: migrationinformation.org

Canadian Prepaid Calling Card Market

In this article, the third in a long series of articles on the prepaid calling card market, I will provide a quick overview on the Canadian prepaid market and where it is heading.

While those of us in the US had seen the huge boom in the phone card market back in the late 90s, Canada was a little bit further behind in it's market maturity. It was not until the early part of this decade that they began their boom. However the boom was very short lived and the market decline began just after the Canadian market hit it's peak in 2004 (320 million in revenues). The quick decline came about mainly as a result of the emergence in the popularity and acceptance of the prepaid mobile market, which took off much faster than in did in the US.

Since 2004 each year has seen a steady decline in revenues, shrinking to around 310 million in 2005, and currently sits around the 280 million mark. The trend looks like it will continue to decline at a pace of around 20 million a year until well into the next decade.

While the Canadian market appears to be maturing much faster, it is also an extremely different marketplace. Immigrants to Canada are not as credit challenged as they are here in the US and their acceptance of new technologies is much greater than it is here. The mobile phone market appears to be taking over at a much faster rate in Canada with a remarkably bigger chunk of the cell phone market going for prepaid over post paid services. Other services like Skype and Vonage are also eating away at the phone card market with their cheaper and more technologically savvy product offerings.

In short the reality is that the immigrant market, long seen as the primary consumer for phone cards, is much more sophisticated and slightly more well off than the US immigrant market. Immigrants to Canada on average have much greater incomes than their US counterparts.

Total Call Settles with IDT

Well, chalk up the total to 4 phone card companies who have agreed to clean up their act as a result of the IDT lawsuit. First there was Dollar Phone, Locus, Epana and now Total Call joins the ranks of parties that has agreed to clean up their calling card disclosure and marketing practices. One area of note... they did not admit to any wrongdoing in the settlement.

Still holding out are: STi Phonecard, Inc., Find & Focus Abilities, Inc, VOIP Enterprises, Inc., and Telco Group, Inc. and CVT Prepaid Solutions, Inc.

IDT Finalizes the Purcahse of It's Corporate Headquarters

IDT finalized the purchase of their headquarters building at 520 Broad Street in Downtown Newark New Jersey. IDT has been renting this space from 520 Broad Street Associates, L.L.C. (a.k.a Kushner Companies) since they moved there in 2000. The seventeen story building is located in the heart of downtown Newark and was constructed sometime back in the 1950s.

Under the terms of the deal, IDT agreed to pay $22.8 million in cash and assume the $27.2 million in remaining mortgage payments, making for a total buy amount of 50 million dollars.

The move comes on the heels of the opening of the close bye Newark Prudential Center, the new home of the New Jersey Devils. Maybe an indicator that the city is on the rise, making real estate in the area a potentially wise investment.

Phone Card Commercial - Week 22

A spanish language commercial for the Super Latino prepaid phone card. I believe this product is a Nobel card.

Intelecard Expo Comes to North East!!!

Not sure if this is a fact yet, but if you go to the Intelecard Expo website they have an announcement that there will be an Intelecard Expo in the Northeast. Looks like it will be from April 22nd to the 24th and will be held in New Jersey at the Expo center in Edison. This would be great as there is a large concentration of prepaid distributors and companies here in the Northeast including myself.

I was still kind of confused as I also got a fl yer in the mail from them promoting a Las Vegas show in March as well. Kind of close together if you ask me! Also strange is the fact that they normally do the spring show in Miami Beach. I wonder if this means that the Miami show is now done... I hope not because it always gave me a nice excuse to go down to beautiful sunny South Beach!

Their website does not look like it has much in the way of details yet so stay tuned!

Phone Card Commercial - Week 21

Commercial for an online phone card website. Nothing too high end but fits the bill.

IDT Shuffles Around Management Team

IDT announced yesterday a whole bunch of internal executive changes in the company. Does not look like they are infusing any new blood into the mix but rather just shuffling around a whole bunch of executives! Brace yourself as I am now going to try and describe the changes.

• Yonah Katz - Former CEO if IDT Telecom is now COO of IDT Telecom
• Motti Lichtenstein - Former COO of IDT Corporation is now CEO of IDT Telecom, a postion he held once before.
• Mikhail Leibov - Former head of Corbina (Russian IDT Venture) will step into the newly created position as President of IDT Telecom
• Marcelo Fischer - Former IDT Corporation CFO is now the CFO of Telecom
• Ely Tendler - Former General Counsel for IDT Corporation now goes back to being Chief General Counsel of IDT Telecom, a position he held once before
• Steve Brown - Former CFO of IDT Corporation is now COO of IDT Corporation

I might have missed someone but for the most part it looks as if IDT is making a play to solidify it's Telecom division as more of an independent entity so they can better position it on the market as an independent asset that can be leveraged or maybe even sold on the open market. Hey I would never put these two things past Mr. Jonas based on his past success with flipping companies.

They also announced that executive compensations were being more closely tied to better performance, which I guess means they are all getting a pay cut until the company does better. I guess it's only fair considering they have been laying off people like flies in recent years.

Quick View on US Prepaid Wireless and VOIP Markets

I received many questions from my recent article "Where Have All of the Prepaid Phone Card Customers Gone? " asking if I had statistics on the prepaid wireless market and the VOIP market so I thought I would take a moment to answer:

US Prepaid Mobile Market:
The Prepaid Wireless market had roughly around 12 million or so subscribers back in 2002 and has more than tripled since then to around 40 million subscribers this year. The largest growth came in 2004 with almost a 50% growth over the year before. The forecasts also show this markets growth slowing over the next few years reaching an estimated 45 million by 2010.

US VOIP Market:
VOIP is the newest kid on the market making it's first noticeable numbers in 2003 with 150,000 subscribers and growing at a consistent pace surpassing the 10 million mark in 2006 and envisioned to continue it's current pace reaching 20 million plus by 2010.

Expanding Beyond Phone Cards to Get More Business

In this article, the second article in a long series of articles on the prepaid industry, we will be covering some alternative products that can be added to the traditional phone card business model. While most of these apply to the distribution business, some can also be applied to service provider model as well.

Prepaid Wireless:

Many traditional prepaid phone card providers like IDT, STI and Oblio have already entered into this market with the expectation that their existing distribution networks will take to the product the same way that they did with calling cards. At the beginning many of the phone card distributors all jumped on board and all signs pointed to big success. But unfortunately the consumer demand for prepaid mobile services in the US had yet to materialize making for some painfully slow sales. Add this to the fact that the distributors had to invest in expensive handsets upfront and were making far smaller margins than they were with calling cards, and you saw a quick decline in the distribution channels willingness to push this side of their business.

The good news is that market demand is finally rising, mostly due to the strong acceptance among the Latin American markets and a greater overall acceptance of prepaid services. There are also far less players today than in years past (no more ESPN mobile, AMP'd mobile and Disney Mobile) making for a less crowded and more profitable industry.

If you are willing to make a little bit of an upfront investment than this can be a lucrative product to add to your mix.

POSA:

Long time touted as the next big thing in prepaid, POSA has generated far more press than it ever generated sales. While I really don't want to get into the finer details of POSA, one thing worth mentioning is that if you can align yourself with the right partners and have the right connections to get into chain stores, this is a product than can help you increase your incremental revenues. To deploy the service you will require a fair amount of technical expertise but don't worry too much about this as most providers are usually more than happy to help in this area.

Also be very careful in this market as there are a lot of patent violation lawsuits on this technology currently being fought over in court. Research your providers and partners heavily to make sure they have the licences, patents and expertise before getting into this business.

International Mobile Phone Rentals:

This is fast becoming a big business here in the United States, with mobile phone rental agencies providing short and long term phones to students and business professionals traveling abroad. The demand for this product is created by the fact that most European countries work on the GSM network, a format not supported by too many US companies, making it almost impossible to use your existing phone outside of North America (some US companies like T-Mobile work on the GSM network but are far too expensive when used for making or receiving calls overseas).

The real challenge with this business is the distribution. In order to succeed you will need to either develop a partnership with a major retail chain like a Western Union or a partnership with travel agencies and even possibly some specific online entities (this last one you can do yourself if you have the e-business savvy).

International Mobile Phone Top-Up Cards:

I had never heard anything about this product until I walked into a Western Union one day and saw an advertisement on the wall to buy top up minutes for your friends and family in Mexico. While I am not sure about how the fulfilment process works (is it through POSA or IVR), it seems to make perfect sense as the Mexicans here are always sending money back home so why not top off their mobile phone minutes at the same time.

The major hurdle here at this point would be finding someone who provides this type of product here in the US. Nevertheless a very interesting product!

Honorary mention:

While the 4 products mentioned above are what I feel would fit the best into the prepaid phone card distribution channel there are a number of other products that can be considered as well like: prepaid gift cards, prepaid translation cards, prepaid Voip, and prepaid utility programs.

Phone Card Commercial - Week 20

A Middle Eastern Calling Card commercial

Ibasis Joins the Movement Towards Cleaner Phone Cards

Well the latest company to join in on the "clean" phone card movement and capitalize on the PR is Ibasis. They announced their new program called "TruePrompts" which will always announce the exact minutes you are going to be delivered.

Is it just me or does it seem kind of odd for a company to come up with a program which basically says we are delivering what we are supposed to deliver... why do you need to come up with a trademarked program to do this?

I guess the phone card business is trying to change it's image in order to gain back some of the customers that they lost due to their previous unscrupulous practices. Too little to late is my opinion!

View TruePrompt Press Release

Shopping for Phone Cards Online

With each passing year, the business of selling phone cards online seems to be getting larger and larger. It used to be that the average phone card user was not Internet or credit enabled but in today's easy credit market, it seems like things are changing. More and more companies are coming out with online stores offering cheap phone cards to the public. Their used to just be a handful of sites like:

blackstoneonline.com
sdicard.com
9278.com
phonecardsavers.com
nobelcom.com

Today we are seeing dozens more sites coming into the mix... companies like

speedypin.com
comfi.com
phonecardmania.com
phonecardsmile.com
and more...

For all of you phone card providers and distributors who aren't selling online today, you are missing out on a very nice revenue stream!

For more info on getting your online phone card sales business going feel free to contact me.

IDT Posts 4th Quarter Results and They Are Just As Bad as Before!

For anyone thinking that IDT will somehow turn their sliding stock price around, history is showing you that this company will not be doing that... who knows maybe they don't even want to turn it around?

The net 4th quarter loss went from 86.5 million in Q4 of 2006 to $112.4 million in Q4 of this year and it just keeps getting worse. Their sales are declining, their revenues are declining, their prepaid market share is declining (in their eyes only due to unfair practices by the competition), their cash on hand is declining and their number of employees are declining. The only good news that I could see is that their Net loss from operations is getting smaller, which means that they have done a better job in controlling their spending.

This company has been through a lot in recent years and should continue through harder times in the future until some of their fledgling business units, other than Telecom manage to get off the ground.

Phone Card Commercial - Week 19

Commercial for a Web based calling card called Calldirect.

Disney Mobile to Shut Down at the End of the Year

The Walt Disney Company announced recently that it would be suspending service on it's fledgling MVNO, Disney Mobile, effective December 31st, 2007. The brand, which was created in 2006 and was targeted towards parents of young children (safe phone that could be monitored and had GPS to track their children), just could not get up to speed fast enough in order to keep pace.

The company's lackluster sales and poor distribution are cited as the main reasons for the closure. They acknowledge that without an extensive brand building campaign they would not achieve the level of success needed to produce competitive numbers. They also claim that spending the money, while possible, would probably not be worth while in such a competitive marketplace.

The brand name and child friendly content was just not enough to compete with companies like Verizon and Sprint who were also heavily pushing kid friendly phones and were willing to spend the money to get the word out!

Truth be told it really does not look like their is much room for many MVNOs in the marketplace and the future does not look better, unless of course your company name is Virgin Mobile!

Disney Mobile runs over the Sprint network.

Phone Card Commercial - Week 18

Again not exactly a commercial but it is an interesting marketing bit put together for Blackstone and their POSA business... warning this piece is about 5 minutes long!

Jury Issues $156 million Dollar Judgement Against At&t Over Prepaid Calling Cards

A federal jury recently ruled in favor of Dallas based TGIP Inc. on their claim that At&t had used two of their patents that allowed the company to deliver point of sale activation for some of their prepaid calling cards. The lawsuit was originally filed back in March of 2006 and named At&t as well as Verizon, MCI and IDT. The later three companies settled out of court but At&t fought it all the way.

The $156 million dollar award was determined by a 4% royalty on At&ts 3.5 billion in calling card sales during the time frame in question.

While At&t is going to appeal the verdict, it seems as if this company has set the proper precedent in court to lay claim to most of the POSA technology in the market today. I guess it's the only company that actually managed to make money off POSA ;)

Ibasis and KPN Are Now One Company

Ibasis just recently announced that they have merged with Royal KPN N.V., the national carrier of the Netherlands, and that they will be taking over control of KPN's international carrier services unit in addition to receiving 55 million dollars in exchange for 40 million shares of Ibasis common stock (giving KPN a 51% stake in Ibasis).

This deal seems like an effort for KPN to outsource it's international termination infrastructure and maintenance to a more cost effective and efficient VOIP company without having to reinvent their existing TDM network.

This deal single handily moves Ibasis into the top three international carriers in the world and should lock up their position as the strongest VOIP carrier in the market today. Ibasis which has been around since 1996 is also a leading provider of prepaid calling cards here in the US.

I

Where Have All of the Prepaid Phone Card Customers Gone?

In this article on the prepaid phone card business, the first in a series of postings regarding the overall business and it's forcasts, we look at some of the main reasons why the phone card market has been shrinking at such an alarming rate.

1) Prepaid Wireless

For years most immigrants, had no way of getting their own phone service due to poor credit so they resorted to using phone cards from payphones to make all of their calls. Now with prepaid cellular becoming so popular (close to 40 million subscribers today), these immigrants and credit challenged people now have more convenient options for making phone calls. To date international calling still remains expensive on these prepaid cell phones but with each passing year we see more and more companies starting to lower their rates to international locations to help increase their revenues and market share numbers.

2) VOIP

Thanks to companies like Vonage, Packet 8, Skype and others, who had no interest in being profitable, home phone service and international rates were brought down to insanely low amounts that consumers would have to be foolish not to try! The good news is that with many companies in this industry going belly up or running up against financial hardships, many consumers have lost faith in this brand of calling and are looking elsewhere for solutions. The problem here is that many are not looking to phone cards as the answer!

3) Cable Companies

While technically classified as VOIP, they deserve separate mention as unlike the other VOIP players, their strategy is to make money. Their pricing is a little higher but they offer good bundling packages that makes overall monthly expenses lower, at least for the first year. By marketing to their existing base they are having tremendous success in driving up their revenues and giving the traditional LD companies a major headache!

4) Traditional LD Providers

Traditional long distance providers like At&t, Verizon, Quest and others were extremely reluctant to give up their fat cat margins but faced with declining customer bases (mostly thanks to cable companies) they have been reluctantly coming around. Today you can find many providers with unlimited international calling plans and deep discounted bucket plans. One thing to note here is that they are not actively marketing or pushing these plans but instead using them as retention tools... no need to pillage a profitable base!

All in all prepaid wireless and wireless in general is probably having the biggest impact on the calling card market and most likely will continue to be the biggest influencer in the future.

Next week I will touch on the prepaid wireless business in a little more detail!