Population Statistic: Read. React. Repeat.
Thursday, October 19, 2021

The Futurephone “no-catch free international calls” mystery, which I mused over last week, seemingly is solved. David Pogue wasn’t able to squeeze the lowdown out of company directly, aside from a vague hint about future audio advertising inserts into the service. But he endorses Alec Saunders’ speculation on arbitrage and other telecom fees being the basis for Futurephone’s current revenue stream:

The short answer is tax subsidies. The 712 model, as I refer to it, is really a variation on the 900 number model, but financed by taxpayers. Take a low cost call, terminate on a high cost carrier, and pocket the difference…

So how do they make money? Since we don’t know know what FuturePhone’s actual termination costs are, let’s make an estimate. We do know that Jajah provides services to the same 50 odd countries for a retail rate of 2.5 cents per minute. So, let’s assume a 50% cost, and say that FuturePhone’s cost to terminate the call is 1.25 cents. That leaves 1.75 cents per minute to split with the folks at Superior Telephone Coop. Give them half, which leaves you 0.875 cents per minute, and you’ve got a pretty attractive proposition! It’s certainly a lot more profitable than SipPhone, charging 1 cent per minute, and probably about as profitable as Skype at 2 cents per minute. It’ll definitely keep bread on the table.

Basically, Futurephone is skimming off the $86.5 million that the State of Iowa gets from the Universal Service Fund, a Federal program intended to ensure affordable phone service in rural areas. The Fund is why Futurephone and similar providers set up shop in 712 land. It’s not illegal, but it’s certainly a non-intended use of a governmentally-subsidized market. Essentially, Washington ends up paying for that “free” call to Europe.

This puts Iowa, and I’d guess other rural States and regions, in the unique position of being fertile start-up territory for these telecom niche providers. Or rather, the area codes are the desirable staging grounds.

If this is true — and to me, it certainly makes more sense than any other scenario — then the bright side is that there’s nothing nefarious about Futurephone’s free ride. You should be able to use it with no worries. And the stated intentions for this service would be accurate: Futurephone is trying to hook early adopters with the freebie, hoping they’ll bond with the brand even after advertising and other add-ons are implemented.

You’d think the government would look at closing up this loophole. But the way these things crawl through Congress, by the time any legislative action is taken, Futurephone and its ilk will have moved onto phase two of their business plans. So I guess we can enjoy an extended period of free talk time with our overseas buddies…

by Costa Tsiokos, Thu 10/19/2006 10:17:41 PM
Category: Tech
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new york pressed
Like most alternative press rags, New York Press is in desperate need of a copy editor; the strained syntax on every page is ample evidence that they don’t have one on the payroll.

Still, unpolished as it is, this Dave Hollander illustration of what makes this year’s New York Rangers team exciting is mighty entertaining:

Jaromir Jagr scores more than Mark Foley at a Young Republicans convention. Only Jesus has more saves than Henrik Lundqvist, who shattered most of the significant Rangers’ rookie goaltender marks held by the venerated Mike Richter last year. Add sophomore scoring phenom Petr Prucha and veteran all-star forward left winger Brendan Shanahan, backed by the vodka-fueled protection of defenseman Sandis Ozolinsh, and you’ve got a fearsome hockey team.

Obviously, the Blueshirts have something for everyone. I’d have gone with “vodka-fueled production” for Ozo, by the way — he is an offensive defenseman, after all. Like I said: Get thee to a copy editor, New York Press.

by Costa Tsiokos, Thu 10/19/2006 08:16:12 AM
Category: Hockey
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