While many entrepreneurs were flocking to the promised riches of the cable and cellular businesses in the early 1980s, George Perrin was quietly buying paging franchises - by comparison an unglamorous pursuit.
But not without reward.Thirteen years later, Paging Network Inc. is the nation's largest paging enterprise and was one of the biggest winners and spenders - $197 million - in the government's first auction of the nation's airwaves.
The spoils: three licenses to provide new wireless communications services nationwide. It beat out several big cable and cellular companies.
The additional airwave space could give the company the edge offering a variety of services, from limited voice to two-way paging and messaging, in the fastest-growing segment of the telecommunications business: wireless communi- cations.
Initially run out of Perrin's Boston home, the company now is based in the Dallas suburb of Plano and employs 3,500 people in 90 offices.
PageNet controls nearly 17 percent of the paging market, with 3.7 million of the 22 million pagers in operation nationwide.
One of the first new services PageNet plans to offer would turn a person's pager into an answering machine. The service is expected to sell for $20 a month when it is launched next year.
"The real opportunity here is to really penetrate the consumer market for the first time," said Barry Fromberg, PageNet's chief financial officer. The vast majority of the company's sales are to business customers.
Only 8 percent of the population now carries pagers.
"Paging and enhanced paging is always going to be the lowest cost form of being in touch," said PaineWebber's Jeffrey Hines.
Before founding PageNet, Perrin was an executive at the industry's leading trade association, known at the time as Telocator. He also worked for two paging companies.
Analysts said Perrin was successful early because he got financing from lenders when capital was exceedingly difficult to come by.
"We had no track record. George had to convince the bankers we knew what we were doing," recalls President Terry Scott. "We gave tours."
These days, Perrin, who is chairman, doesn't have an active role in the company and maintains a low profile.
The company's steady growth - 50 percent a year in subscribers - is rooted in its ability to offer a deeply discounted service, analysts say.
"They established a foothold in the market by offering a low-cost service," said Fred Moran, who follows the company for Salomon Brothers. "They had a cost-conscious attitude with much lower overhead and employees per pager than competitors."
PageNet's bread-and-butter service is the local paging service - customers carry a beeper that buzzes or vibrates when called and displays the phone number of the caller. PageNet charges $7 to $9 a month for the service; the industry average is $14.20.
The company extended that strategy when it entered the nationwide paging market last November.
Skytel, which dominates the field, lowered its rate early this year from $69.95 a month to $39 for the service and a leased pager able to receive messages from around the country. PageNet charges $29.95 a month, Fromberg said.
PageNet's average cost per pager is 25 percent to 30 percent lower than the rest of the industry.
As a result, net revenues for the quarter ended June 30 increased 31.7 percent to $99.3 million from the same period one year earlier. The company wrapped up 1993 with $311 million in net revenues - a 40.3 percent increase over 1992.