Pocket change for pay phones may be going the way of vinyl LPs and leisure suits.
Instead of slipping quarters into telephone slots, more consumers are using wallet-size prepaid calling cards that carry advertising, sayings, or flashy pictures of celebrities such as Marilyn Monroe, Elvis and King Kong.Similar to bank debit cards, prepaid phone cards offer time purchased in advance, ranging from $5 to $50. Travelers, foreign visitors, college students and people on limited budgets find them more convenient and, in some cases, cheaper than traditional calling cards.
Moreover, they are a hot commodity among collectors; some have sold for thousands of dollars.
"I thought it was cute," said Phyllis Miller of Aurora, who used a 10-minute prepaid card that came inside a Hallmark card. "If I went to Hawaii again or on vacation someplace, I could use it to call home."
Conceived in Italy in 1976, prepaid cards were designed to prevent coin thefts from pay phones, said Joe Clark, chairman of the Prepaid Communications Association, a trade group.
Six countries had them by 1982, and in 1991, a handful of companies introduced the cards in the United States.
Initially, the cards were popular with collectors. A New York Telephone card given away to participants at the 1992 Democratic National Convention recently sold for $1,700. A phone card given away by McDonald's Corp. as part of a Midwest promotion went for $125.
Today, more than 500 companies and fund-raising organizations sell or give them away. The cards are available at convenience stores, drugstores, grocery chains and even the neighborhood truck stop.
"We're predicting that it will be a billion-dollar industry this year in the United States," Clark said.
With a traditional calling card, a consumer can make a call and charge it to a third number. The caller dials an access number, punches in a personal identification number and then makes the call.
To offer a prepaid card, a company - a telephone company, a retailer or even a non-profit organization - purchases time from a long-distance carrier, then sells or offers it free on a prepaid card.
The consumer dials a toll-free number, punches in a personal identification number and makes the call, which depletes time on the card. Some cards can be recharged by purchasing more time.
"It's never going to do away with pay phones. What could happen, as has happened in Japan and Europe, is you don't have coins anymore. Everything is prepaid; everything is done through a card," said Clark.
Because the industry is largely unregulated, Clark said companies set their own per-minute rates. Sometimes there are bargains.
For example, a long distance call from New York to Los Angeles can cost $1.60 on a traditional card, but can be as cheap as $1 on a prepaid card, Clark said.
The lack of regulation also has left the industry vulnerable to scams, he said.
"What the Prepaid Communications Associations has tried to do is establish some rules and regulate itself," Clark said. "Because there are no real restrictions right now, we've been trying to monitor and set some standards for our members to actually live by."
Perhaps the industry's biggest problem is consumer awareness - how to get the word out in the increasingly complex telecommunications field.
For example, Hallmark Corp. offered a 10-minute prepaid card in a series of cards in November 1993. The cards did well, but were ahead of their time, said Hallmark spokeswoman Rachel Bolton.