Column Date 2006-11-12

Double your money, overnight

You’ve got to hand it to America’s cell phone companies. They’ve figured out how to double their money...and most of us haven’t caught on yet.

It’s a diabolically simple plan.

First, think back, to the neolithic world of regular telephones (you know, the ones attached to wires that are attached to telephone poles). When you pick up a regular phone and make a long distance call to a friend in L.A., you know it’s costing you 3.9¢ or 10¢ or whatever per minute. You dial the number and the charge shows up on your bill.

But here’s the important thing to remember: the friend you called in Los Angeles doesn’t pay a penny. He just picks up his phone and says hello. The call was made on your dime, as they say.

Fast forward: in today’s cell phone world, you call the same friend and what happens? You both pay!

Say you talk for 10 minutes. Well, you pay for your time (the 10 minutes are deducted from whatever calling plan you’re on), and your friend pays for his 10 minutes the same way.

In other words, the cell phone companies are getting paid twice for the same connection – once by you and once by your friend. (If you happen to have the same cell phone company, it’s sometimes free – but who knows with any given call?)

Nice deal, huh?

I guarantee you that, all over American, hundreds of CEOs and their teams of high powered accountants are trying to figure out how they can do the same thing.

So get ready:

FedEx will probably be the first to jump on the bandwagon: why charge only the person sending the overnight package? Since the package is equally important to the person receiving it, why not charge both parties for overnight delivery? A simple computer update and FedEx doubles its income without providing a whit more service.

And if FedEx does it, can the United States Post Office be far behind?

I can hear my next conversation with a postal clerk, right out of Seinfeld:

“Yes, sir, that 39-cent stamp means that the Post Office has accepted your mail. The fellow it’s addressed to also has to pay 39 cents if he wants to receive it.”

“But the stamp is like a contract – it says you’ll take it from my address to his address. That’s the way it’s always worked. It’s part of our social fabric.”

“Yes, sir. But if he wants to actually take possession of it, it’ll cost him 39-cents.”

“And what if he doesn’t?”

“Well then, it will come back to you. With 39-cents postage due.”

“Look -- up there, on the wall -- it says ‘Neither snow nor rain nor heat nor gloom of night stays these couriers from the swift completion of their appointed rounds’. Do you guys still do that?”

“Depends on how much rain we’re talking about, sir. By the way, our appointed rounds no longer include Saturday delivery in your neighborhood. Sorry. Have you tried FedEx?”

©2006 Peter Tannen