TELECOM 247

NG,

I need some feedback on a new calling card release, so apologies if this is
off track.

My company has now received delivery of some 50,000 calling cards from the
printers. Positioning is as follows:

1. Second billing
2. No charge 0800
3. National rate support number, 24/7 answered by a human operator
4. Most routes are our own directs to destination countries, and where A-Z
termination is off-net, then this is purchased from a very large and
reputable telco
5. Minute charges are the lowest in the market by far

Predicament is that to make profit, we need to sell the card to distribution
at somewhere close to Ł3.80 for a Ł5 card and Ł7.20 for a Ł10 card. Couple
of very large distributors expressed interest at Ł3.25 for a Ł5 card which
breaks the business logic.

Back to the drawing board, the only way we can still achieve our parameters
without increasing the minute charge is to introduce usage charges, either
on a per-destination first-minute basis, on a per-card-use basis or a
one-off charge.

The first option is simple enough - we calculate a first-minute charge, and
take it from there. The second option is such that only the first 4 uses are
charged a connection charge - essentially spreading the connection charge
over the first four times the card is used. The last option is again
trivial.

Can anyone give me some feedback on those propositions ?

Many thanks in advance,

Ahmad Ibrahim
Director
ABC (Europe) LTD