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1993-09-01
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The War Profiteer
by Dave Bealer
It was the last decade of the twentieth century. Vicious long
distance telephone service sales wars raged across the face of North
America. As in most fields disrupted by the deregulation craze of
the 1980s, the ensuing confusion created winners and losers. The
"little guy" was, as usual, the loser (Arnold Jensen of Ponca City,
Oklahoma, known to his friends as the "little guy"). The winners
were typically those who were in bed with the regulators or, in this
case, the deregulators. There were three majors players in this
high-tech warfare:
American Telecommunications and Pork Barrels (AT&PB)
- The inventor of modern telephone and monopoly technology, AT&PB
managed to get "split up" into several even more profitable
segments, none of which were regulated in the same restrictive way
as the old monopolistic, er, monolithic entity. This scheme was
designed to provide competition in the marketplace. Sure, that'll
work... just like unchaining a fully grown Tyrannosaurus Rex and
letting it compete with some newly hatched iguanas.
Splint
- The communications and health services conglomerate. A product of
deregulation, Splint competed by touting quality service. They
also managed to profitably combine some of their varied holdings.
Splint's Dial-A-Shrink service proved very popular with those
mentally ill persons who prefer not to leave the comfort of their
own couch.
Texas Communications, Inc. (TCI)
- Formerly a local service provider in Texas, these guys thought
they were bigger and more important than the rest of the country.
TCI's splashy ad campaigns reveal the firm's style-over-substance
philosophy.
One of the major weapons used by all three of these competitors was
a rebate offered to those who switched services. As competition
mounted, the rebate amounts continued to climb. If a customer
dropped Splint for TCI, someone from Splint would be on the phone
within five minutes offering him $50 to switch back. Ten minutes
later a representative of AT&PB called, offering $75 to switch to
their service. Spiraling rebates made it inevitable that someone
would figure out how to make a buck out of the deal, that's the way
of war. A few crafty long distance customers had a bank of phones
installed, quit their regular jobs, and made a good living switching
between the various long distance companies.
Victor Klam was the most successful of the war profiteers. His firm,
The Old Switcheroo, did contract switching for residential customers.
Instead of dealing directly with the long distance companies,
Victor's clients gave The Old Switcheroo power of attorney to make
their long distance service switching decisions for them. The cost
was a modest 20% of the rebates generated. This wasn't too bad,
considering the hours of time this saved the customers each day.
A lifelong resident of Lakewood, New Jersey, Victor's success enabled
him to live the flamboyant lifestyle he always dreamed about. Victor
purchased a minor league baseball team, the Toms River Lemmings, and
ably played the part of the wealthy sportsman. A confirmed teatotal-
ler, Victor was now able to flaunt his peculiar tastes in public and
be considered eccentric rather than insane. Bartenders at the most
fashionable local country clubs and watering holes soon became used
to accommodating Victor's "usual" drink: "pickle juice, Vlasic Dill,
1973, shaken, not stirred."
Nothing lasts forever, especially nothing pleasant. The competing
long distance firms eventually figured out what the war profiteers
were doing and took steps to make the premiums for switching less
liquid. TCI offered to pave the customer's driveway in return for
switching to TCI for a whole year. Splint offered discounts on new
cars and trucks while AT&PB offered free pork. Always one to roll
with the punches, Victor opened a combination butcher shop, used car
dealership and paving company.
Eventually some nosy accountant figured out that the huge losses
experienced by all three long distance companies were connected to
the fact that they were spending $7 in premiums to generate each $1
of revenue. The easy ride for the war profiteers ended soon after
long distance company stockholders became aware of this little fact.
Victor sold his combination business and is now president of Klam
Juice Cocktails (KJC) of Brick Town, New Jersey. KJC specializes in
vintage pickle juices from America, although some popular brands are
imported from Europe as well. {RAH}
--------------
Dave Bealer is a thirty-something mainframe systems programmer who
works with CICS, MVS and all manner of nasty acronyms at one of the
largest heavy metal shops on the East Coast. He shares a waterfront
townhome in Pasadena, MD. with two cats who annoy him endlessly as he
writes and electronically publishes RAH. FidoNet> 1:261/1129
Internet: dbealer@clark.net