CHARLESTON, W.Va. -- Verizon is increasing the price of a local payphone call to 50 cents in West Virginia starting this month.
The conversion process involves changes at each individual payphone and will take several months to complete. Verizon operates approximately 7,600 payphones in West Virginia.
The price change follows an intense and ongoing cost-cutting campaign at Verizon's Public Communications subsidiary, the company unit that operates payphones. The effort was waged to combat declines in both payphone revenue and use resulting from stiff competition from wireless services. Without the rate increase, the widespread availability of payphones would be threatened.
Verizon began converting payphones in most markets nationwide in September to the new price of 50 cents for a local call of unlimited length.
Qwest, SBC Communications and BellSouth also have announced 50-cent pricing for local payphone calls.
The increase to 50 cents for most payphone calls follows erosion in payphone usage of about 23 percent over the past 2-1/2 years, when wireless services became a popular way of calling for people on the move.
At the same time, revenue has decreased overall as a result of federal rules that compensate payphone companies just 24 cents, regardless of how long a call lasts, when callers use pre-paid or post-paid calling cards or dial-around services like collect calling services.
"We're meeting the challenge from alternate services and technologies," said Paul Francischetti, vice president of marketing and business development for Verizon Public Communications, which operates Verizon payphones. "We're making sure our phones are located where people need them, that they're functional and clean, and that they have the features customers want. We're experimenting with different types of equipment and with Internet access via up-to-date work station kiosks."
In addition, he said the company is reviewing the profitability of its payphones and removing some phones to cut costs and increase the return from phones that remain. In most cases, this involves taking out one or more phones from a bank of phones, improving the performance of those that remain. When removing phones, the company rarely abandons a site completely.
Verizon continues to aggressively cut the overall costs of running its payphone business. "Our benchmarking studies show that we run one of the most efficient payphone businesses in the country," said Francischetti.
Verizon also will be increasing the price of local directory assistance dialed from payphones to 50 cents. Verizon Public Communications must recover the cost it incurs in providing directory assistance to its payphone customers.
Verizon Communications (NYSE:VZ) is one of the world's leading providers of communications services. Verizon companies are the largest providers of wireline and wireless communications in the United States, with 128.5 million access line equivalents and 28.7 million wireless customers. Verizon is also the largest directory publisher in the world. A Fortune 10 company with about 256,000 employees and more than $65 billion in annual revenues, Verizon's global presence extends to 40 countries in the Americas, Europe, Asia and the Pacific. For more information on Verizon, visit www.verizon.com.