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How profitable is the International calling card business & what are the barriers to entry? How profitable is the International calling card business & what are the barriers to entry?

09-21-2010 , 01:11 AM
Wondering if anyone has any first or second-hand experience in the international calling card business?

I place orders with small wholesalers and manufacturers in Mexico, Thailand, Bali, and to a lesser extent, Hong Kong & China. Most communication is done via email, but every once in a while I still need to make an overseas call or send a multi-page fax.

I do this so infrequently that it really doesn't make sense for me to pay $5/month to add an international calling plan to my business phone service, & many of my the companies I deal with don't use SKYPE. So, every once in a while, when I need to make some international calls & faxes, I stop by the local 7/11 and buy a pre-paid international calling card.

What a rip off these things are!! The fine print on the back of the various cards is so small I can barely read it, & regardless, I doubt most people bother. But there are so many B.S. fees & conditions--rounding up to the next full minute, $0.49 connection fees, $0.99 surcharge if you call from a pay phone, initial activation fees, monthly maintenance fees, surcharge if you call from a cell phone, per call connection fees, and on and on and on! I saw one card that had a service fee, not every month, but every week! What a friggin' scam!!

Obviously these companies make a boatload of money off these B.S. fees, and that's not even taking into consideration the amount of money the make from people who lose their cards &/or simply don't use them, and then their card balance goes to zero after a few months of inactivity due to "monthly service fees".

I'm guessing that many of you will say that this is a dying technology or service as most everyone now has cell phones, internet phone service, etc. However, I wonder if it really is a dying service, or if there are will always be a demand for international calling cards due to large lower income immigrants, tourists, etc.

I have no idea what the barriers of entry are in this business, and I imagine one of the toughest obstacles would simply be getting shelf space in local convenience stores, 7/11's, Walmarts, etc., but at the same time, if a company offered the same service but without all the B.S. fees (i.e., without ripping off 7/11 & Walmart customers) why wouldn't they give you shelf space?

Perhaps even more surprising--why doesn't 7/11 & the Walmarts of the world offer their own branded calling cards??
How profitable is the International calling card business & what are the barriers to entry? Quote
09-21-2010 , 03:09 AM
interested in this as well.
How profitable is the International calling card business & what are the barriers to entry? Quote
09-21-2010 , 04:36 AM
Can't you call their landline from skype for a fee? I don't know how you could get around the having to fax.

And with VoIP, celluar service, WiFi this industry will be basically dead within a decade. I'm surprised there even still around now.
How profitable is the International calling card business & what are the barriers to entry? Quote
09-21-2010 , 08:46 AM
I had someone try to get me to invest in his calling card business ~6 years ago. i only did a very brief look at it but I got the impression that a decent percentage of the market was just fly-by-night scams where they would sell airtime they never actually intended to pay for and then just disappear. I didn't really understand how it worked but there seemed to be a lot of sketchiness.
How profitable is the International calling card business & what are the barriers to entry? Quote
09-21-2010 , 03:09 PM
High fees or not, I doubt many of these companies make a 'boatload' of money.
How profitable is the International calling card business & what are the barriers to entry? Quote
09-21-2010 , 06:11 PM
Yea, overall it does seem to be a "sketchy" business operated by a bunch of "sketchy" companies, all of whom seem bent on screwing over their customers with B.S. fees.

I don't know whether or not these companies make "boatloads" of money (what's the definition of a boatload of money, anyway?) but if you've got a product in thousands of 7/11s & Ma & Pa convenience stores across the country, I imagine you've got yourself a profitable little company.

Although I have no doubt that revenue has declined w/ increase in cell phones, VIOP, Skype, etc., I still see lots of people buying phone cards. Just makes me wonder what kind of opportunities might be out there for someone willing to operate a little more legit & actually selling a quality product for a fair price . . .
How profitable is the International calling card business & what are the barriers to entry? Quote
09-21-2010 , 06:20 PM
I think the people who use to just not pay made good money -- at least as measured against the initial investment. Other than the printing and distribution they had no costs.

I doubt there is an opportunity here to operate more legitimately. The scammy scammy places are always going to be able to advertise a lower cost in big bold letters which will get the people who buy on price alone. People who have been burned with cards that stopped working are going to go to the cards that are backed by a known name such as Walmart. As you said the business is declining so trying to enter now with the intent of building a name as a reputable company is likely not worth it.
How profitable is the International calling card business & what are the barriers to entry? Quote

      
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