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900 Numbers Celebrate 20 Year Anniversary

In little more than a decade, 900 number service has undergone considerable evolution beginning as a simple polling mechanism to an information and entertainment vehicle and finally, to the powerful, interactive marketing tool it is today.

Actually, the first use of information by phone began long before the introduction of 900 service. New Jersey Bell, in 1927, and New York Telephone, in 1928, created a recorded time of day service to alleviate the burden of such requests made to its operators. These services were the nation's first 976 numbers.

One of the added benefits of the service was that operators of the day had to avoid the constant propositions they heard from interested men. Years later, in the 1950's, recorded technology was developed, and the phone companies added weather, horoscopes, sports, and off-track betting information for their customers.

AT&T was initially asked to develop the 900 number for use by television networks as a way to conduct instant polls of viewers on matters of current interest. ABC's Nightline used a 900 number first during the 1980 presidential debate, when it polled viewers on who they believed had won the Reagan-Carter debate.

Cost of the call was 50 cents. There were so many calls that phone likes jammed around the country. By a tally of 469,412 to 227,017, viewers picked the Californian, and both a new presidency and phone concept were launched.

As a spoof, those zanies at Saturday Night Live tried their own version of the 900 polling technology. Viewers were asked to call in to vote whether or not Eddie Murphy should boil Larry the Lobster or let him live and give him valuable prizes.

In a close vote, Larry was granted clemency, but Murphy boiled him anyway. So much for democracy. And so much for our nation, which cash as many votes on the fate of Larry as on the fate of Jimmy and Ronald a few months earlier. Well, that's show biz.

Despite such high profile programs, the 900 industry was originally limited to only 44 simultaneous programs. Thus, the service was used sporadically for polling and supplying various non-interactive (where the same message is heard by all callers) information.

In 1981, during the divestiture proceedings of AT&T, the Justice Department ruled that the Bell Operating Companies could no longer provide information by telephone themselves.

This decision opened the door for companies and entrepreneurs to enter the pay per call business by providing the informational messages; the telephone companies, meanwhile, continued to provide the networks, transport, billing, and collections that are common to the industry today.

The information feature came about that same year when NASA asked AT&T for a 900 number to enable reporters and space buffs to hear conversations between mission control and astronauts on space shuttles. After the first two flights, the number was made available to the public. Thousands dialed it during the Challenger disaster.

Until the spring of 1985, nobody leasing a 900 number received revenue from the calls. AT&T received 50 cents for the first minute and 35 cents for each subsequent minute.

As a result, 900 numbers were primarily used by corporations as promotion or information tools. Johnson & Johnson, for example, used AT&T's Dial-It 900 Service to release consumer information during the Tylenol tampering scare.

In April of 1985, however, AT&T began giving 900 providers up to five cents from each call. For the first time, companies of all kinds were able to use 900 numbers to make money. Demand for the numbers increased significantly.

In January 1987, the 900 business changed dramatically. AT&T stopped paying commissions to program sponsors and introduced premium rate billing, a contract offering that permitted proprietors of 900 programs (information providers, or IPs) to set a price they want charge for the value of the information or service they are providing.

AT&T's Dial-It network allowed companies to charge up to $2.00 for the first minute of a call, permitting the information provider to keep $1.35 (AT&T pocketed the toll from extra minutes). The system had its limitations. It was passive (non-interactive) only and had limited ability to offer numerous programs at the same time.

During the same year, the now bankrupt Telesphere International began the nation's first interactive 900 service. First offered in Chicago, the small interexchange carrier (IXC-a long distance company like AT&T, MCI, and Sprint) soon expanded service to include New York City and later the nation in 1989.

Telesphere enjoyed early dominance in the 900 field. The introduction of pay per call was a major hit with the small interexchange carrier. Its revenues more than doubled from 1987 to 1988. Half of its $36 million revenues in the first quarter of 1988 came from 900 service.

By now, information providers could charge up to $50 flat rate per call. This enormous profit potential spawned hundreds of less than legitimate applications, including children's programs, credit card scams, and adult entertainment.

The carriers were helpless in preventing pornographers from entering the business, as the Freedom of Information Act prevented a carrier from controlling the kind of information available on its network.

It wasn't until the carriers were to show their high uncollectible rates on pornographic programs that they were allowed to remove them. Today, the 900 industry still suffers from the black eye it received in the early days of the 900 business from these less valuable applications.

What the carriers did not count on was the rapid proliferation of adult message lines, said Lou Delery, general manager of AT&T MultiQuest 900 service. "Suddenly we were in the middle of a storm of complaints from consumers, legislators, and attorneys general. We were spending so much time managing complaints that the service almost didn't seem worth it. We decided drastic changes were needed."

National 900 services were implemented at break-neck speed by the carriers. In February 1989, AT&T joined MCI and Sprint in offering its own expanded 900 service by introducing MultiQuest-a package of several interactive 900 options.

The term MultiQuest implied the vast range of information sources available through the telephone to serve people in their quest for information and entertainment. Corporate America began to embrace the 900 number.

Chrysler and Paine Webber began allowing shareholders to listen in on their meetings via 900 number. President George Bush even touted the merits of the industry by appearing in a television commercial that encouraged viewers to call a 900 number in support of the USO.

Interest was at the fever pitch in 1989. Stories in the New York Times said that 900 "could greatly expand consumer services over the telephone." Many other articles talked about a new future for billing and collection that "could some day replace credit cards."

Prominent media such as the major television networks regularly began using 900 service. USA Today offered sports, weather, and stock quotes.

ABC's daytime soap opera magazine Episodes used a 900 number to launch sales of its publication. Two million soap fanatics responded and ordered a subscription.

ABC also brought 900 into the homes of prime time America with its regular use of the service as a vote line during halftime of its Monday Night Football telecasts. On the initial night, service bureau Call Interactive handled over 8,000 simultaneous calls as 51% of callers chose Tony Dorsett's rushing play as the most spectacular in the 20-year history of Monday Night Football. (Just for the record, O.J. Simpson got 19%; Bo Jackson, 16%; Earl Campbell, 8%; and Refrigerator Perry, 6%)

In December 1989, in a rare act of unification among the Big Three networks, each agreed to run a two minute commercial after popular prime time shows to promote a 900 number for Prime Time to End Hunger.

This major media event was deigned to provide a data base of volunteers for the organization. The commercials ran on the Cosby Show, Golden Girls, and Cheers (NBC), Murder She Wrote, Jake and the Fatman, and Designing Women (CBS), and thirtysomething and Head of the Class (ABC).

Another famous 1989 promotion was a contest to win one of 36 vintage Corvettes, one for each year from 1953 to 1989, sponsored by MTV. More than 1.1 million people entered the contest during its two-month run.

A whopping 87% or all entries came from a $2 900 call, while other contestants used the free alternative mail-in entry method. This program was later contested by a civil suit on the grounds of illegal gambling, but the program was upheld as legal by a federal judge.

America's most popular game show, Wheel of Fortune, racked up an amazing 4.7 million calls during a three-week promotion that allowed callers to play along with Pat Sajak and Vanna White. The game promotion ran for three weeks to increase ratings.

The over $6 million invested in advertising included full page ads in People, Readers Digest, TV Guide and 25 daily newspapers. The cost of the call was $2 per minute. Callers got a coupon for a personal pan pizza from Pizza Hut just for playing.

Each night randomly selected winners received $1,000 prizes or Caribbean cruises. A portion of the proceeds went to Toys for Tots. Over $1 million was raised for this very worthwhile charity.

Today, the glory days of the much maligned 900 number are clearly a thing of the past. There are, however, many companies and entrepreneurs still making money from the 900 number industry.

It's hard to imagine how strong the 900 number industry would be today if it weren't for a few mistakes made along the way. But, for now, with shows like "Deal or No Deal" it seems like text messaging is the new promotional vehicle of choice for media.

Article Source: http://www.dummiesguideto.com

Bob Bentz is the co-owner of Advanced Telecom Services which has been providing 900 numbers and text message marketing since 1989. Bentz is also the author of Opportunity is Calling--How To Start Your Own 900 Number

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