Air Call Plc, now 40%-owned by regional Bell operating company BellSouth, is investing UKP5m to upgrade its paging network infrastructure and to extend its 30% coverage of the UK, which moved up to 45% in the last few weeks, to a nationwide service by 1989. It is looking for a 20% share of the 1m […]
Air Call Plc, now 40%-owned by regional Bell operating company BellSouth, is investing UKP5m to upgrade its paging network infrastructure and to extend its 30% coverage of the UK, which moved up to 45% in the last few weeks, to a nationwide service by 1989. It is looking for a 20% share of the 1m subscribers it fore-casts will be using pagers in 1991 and estimates that the market is growing at some 25% per year. Paging represents well over 50% of Air Call Holdings’ turnover, which stands in 1987 at some UKP50m, and it has been in the business since 1972. However, the business is not yet making a profit, despite the fact that the company claims to be the second wide area pager in line after British Telecom Mobile Communications, BTMC. In addition, fresh competition is pushing its way into the market, following legislation passed by in December 1986, and Air Call must invest in order to keep its name amongst the front runners. Mercury has entered the market with Motorola, anticipating explosive growth and is selling its pagers outright as well as leasing them, unlike BTMC. Racal Vodapage is also soon to launch a nationwide service. Air Call will be buying new infrastructure kit over the next three years, mostly from BET, part of the Transfusion group, installing aerial sites at a rate of five per week. It will also upgrade its nine existing messaging centres to stay ahead in the value added services area, which it feels is its strength for the future. The first new area to get access to the Air Call VHF paging network will be the southwest, centred around Bristol. The Yorkshire region around Humberside will follow that and then the Middlesbrough area around Newcastle by mid-1988. Telecom holds 85% of the paging market because the Department of Trade and Industry introduced licences for four other VHF pager operators to run a nationwide service in the UK only in December 1986. Air Call, one of the first pager operators in the UK, has experienced financial difficulties in the last couple of years, unable to compete with the bigger players that have begun taking advantage of telecoms liberalisation in the UK. It made a decision to withdraw from the Unlisted Securities Market in 1986 to restructure its communications activities into a separate company, called Air Call Communications, when US regional Bell operating company BellSouth took a 40% stake in the company as a means of entering the UK telecoms market. Air Call aims for its paging business to be profitable by next year and is looking for big expansion in the market. The cost of hardware will come down quite rapidly, says marketing manager John Abbott, while airtime prices will remain stable, similar to what has happened in the cellular radio market. By 1989, the company expects at least 60% of its turnover to come from value added services, such as message storage and retrieval. Further value-added services, such as the pager that Reuters markets, which was conceived by Air Call and offers a once-a-minute exchange rate print out, will be added. Around 30% of Air Call’s pagers will be sold or leased by distributors under their own brand names. It is discussing terms with distributors now.