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From: Ken Jongsma <wybbs!ken@sharkey.cc.umich.edu>
Newsgroups: comp.dcom.telecom
Subject: Re: Cellular Marketing
Message-ID: <11157@accuvax.nwu.edu>
Date: 21 Aug 90 13:23:00 GMT
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X-Telecom-Digest: Volume 10, Issue 585, Message 3 of 14


In her reply to my original post on the economics of Cellular Phones,
jill@midway.uchicago.edu correctly points out that there are some very
valid uses of Cellular Phones. I think we both agree that there must
be a cost benefit trade off when using any business tool. However,
based on my limited sampling of calls in one city, at various times of
the day and night, Cellular Phones have a very high degree of misuse.

1) Jill's example of setting up an office at a quiet gate is a good
use of the tool. However, would it be cheaper to use a desk in the
airline "Red Carpet Club"? Maybe, maybe not. Cost benefit again.

2) The analogy regarding calculators is a good one. Let's look at
where we are on the technology curve though. I think we're still at
the beginning stages of cordless, personal communication devices.
While the costs of the cellular phone are low, the overall cost of
service is much higher than wireline service. It's much less expensive
to run a radio tower to 1000 customers than it is to bury cable to
those same customers. I suspect the novelty of the service and the
lack of real competition is keeping rates much higher than they could
be.

Note: I realize that LA is running out of capacity, but in most of the
country, scarcity of capacity is not a factor in pricing.

Cellular has it's place. It's just being misused in many cases.


Ken Jongsma               ken@wybbs.mi.org
Smiths Industries         ken%wybbs@sharkey.umich.edu
Grand Rapids, Michigan    ..sharkey.cc.umich.edu!wybbs!ken