Price muddle in phone wars

September 1999
Advertising Age;9/6/1999, Vol. 70 Issue 37, p16
Trade Publication
This article focuses on the issue concerning the price war among long-distance telephone service firms AT&T Corp., MCI WorldCom and Sprint Corp. The real price war still eludes marketers in the latest 7 cent versus 5 cent a minute calling rate now doing battle with one another. There are different monthly fee structures to weigh, and different time-of-day calling restrictions. For a consumer to determine where the value lies, he or she must sit with sharpened pencil and past phone bills. For many residential consumers, long-distance service is perhaps a $300 a year expense. When it takes this much work to weigh different sales propositions, no wonder so many throw up their hands and stick with existing plans and existing vendors. Of course, the marketers involved no doubt know this. Their quarry is not the average household but the smaller group of heavy users of long-distance. Actually, price war is not exactly what long-distance marketers are dabbling in even now, at any rate, as long as their offerings defy easy comparison. Nor does the direction of telecommunication services marketing offer much optimism that clarity will break out any time soon. Strategist for these marketers are marching toward a future where services will not be sold with Internet access, cable TV, local and long-distance voice communications all thrown together in one pot and at one price.


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