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Written by asap
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Wednesday, 04 October 2006 |
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If you’re looking for the number of your local pizza place, you can get it for free by sending a text message to Google or dialing 800-FREE-411. Meanwhile, dialing directory assistance on your cell phone will cost you — but you can also get sports scores, stock quotes and directions to the dry cleaner.
While directory assistance has long been considered, in the words of one analyst, the “Rodney Dangerfield” of telecommunications, a number of free information services are causing telephone companies to rethink 411.
Overall, the directory assistance market will pull in an estimated $5.7 billion this year, said Saroja Girishankar, vice president of the Pelorus Group, which studies 411. The majority — about 6 in 10 — of directory assistance calls come from cell phones, and wireless companies charge $1.50 on average per 411 call but pay only around 25 cents to third-party wholesalers who actually field the calls, analysts said.
Before the Internet and the explosion of cell phones, telephone companies had a captive market for bare-bones directory assistance. As a result, innovating wasn’t a priority, and that portion of the market “didn’t get any respect,” said Kathleen Pierz of the Pierz Group, another 411 analyst.
But the pressure began to increase as more people went online to look up phone numbers and addresses. Then in the past two years, free options have helped people get information over the phone, further changing the game.
“Directory service is undergoing this metamorphosis. It’s being redefined,” Girishankar said.
CRASHING THE 411 PARTY
While there’s still no such thing as a free lunch, you can certainly get the address of lunch at no cost. Google and Yahoo each offer services in which you key in the name of a business or person, along with the city or zip code to receive the address and phone number. Send a text to “googl” (46654) or “yahoo” (92466), and you can also look up stock quotes and the weather or even crunch math problems.
These services work great if you’re wandering a big city on foot. However, the service will be limited by the fact that it’s dangerous to text while driving, and many people over the age of 40 prefer voice-calling to texting, Pierz said.
A Google spokesman told asap that the company hasn’t executed a plan to make money off the free service — but it’s likely that these Internet search giants will find a way. In the meantime, the text searches are a good way to further extend awareness of the brands.
For those who prefer to save the text-message thumbstrokes, several toll-free numbers have appeared in the past year, including 800-FREE-411, 800-411-SAVE and 877-520-FIND. Advertisers pick up the tab, meaning users typically sit through a commercial before they get the listing or are encouraged to connect to an advertiser.
The ad-supported services represent about 2 percent of the directory assistance market in 2006 but should capture about 11 percent in five years, Pierz said.
The longest-running and most successful of the ad-supported 411 has been the year-old 800-FREE-411. George Garrick, CEO of parent Jingle Networks, said ad-supported content on the Internet has also helped people accept the idea of sitting through a commercial to get free content. In August, Jingle received 13 million calls from 4 million users.
“The growth has definitely been ahead of our expectation because we haven’t done any advertising at this point, or promotion. It’s all been word of mouth,” Garrick told asap.
DON’T CALL IT A PARADIGM SHIFT
Traditional 411 providers say their directory assistance is faster, more accurate and simply easier to use than the free alternatives. Plus it’s easier to remember the numbers 4-1-1 than a ten-digit toll free number or the specific format in which you need to phrase a text-message search.
But providers of paid-for 411 have certainly taken note of their competition. Over the last five years, wireless carriers have added sports scores, movie times, stock quotes and other information to the menu of services. (By law landline providers — an increasingly small segment of the 411 market — typically can’t provide the enhanced features).
Verizon LiveSource provides wholesale directory assistance services to carriers including Verizon Wireless, Cingular, T-Mobile and Alltel. The unit of Verizon Communications handles 3 million directory assistance calls per day.
A few weeks ago it began offering to have operators send a text message with a phone number, saving the hassle of reaching for a pen and paper.
LiveSource also began experimenting with free directory assistance with a 60-day trial in Pittsburgh, said Tom Moran, the unit’s executive director of marketing. Moran expects to eventually roll out a free service for one or more of its clients -- probably supported by businesses who pay each time a customer connects to them.
When it comes to ad-supported telephone intformation services, he said, “the jury’s still out.”
Still, the expanding 411 offerings and the proliferation of free services are evidence that the game has changed for good, analysts say.
“I hate to use the cliche ‘paradigm shift,’ but that’s exactly what’s happening right now,” Girishankar said. | Only registered users can write comments.
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