BBG Communications Phone Card Industry

According to BBG Communications, prepaid phonecards were created in Europe in the 1975. Calling cards, however, were not available until after 1986. Since there inception, the calling card and phone card industry has grown substantially across the world. In 2009, the international phone card is sold in over 185 countries around the world.

In 1975, the Phone Card was invented. The company that is widely considered as the founder is SIDA. However, SIDA was not in the telecommunications industry, but was a manufacturer and supplier of vending machines.

In 1976, the first prepaid phone cards were produced and put on the market in Italy. Italy made the move in hopes that it would reduce payphone vandalism. The first cards to be introduced had a magnetic strip on the back for use in special phones to combat the coin shortage. The first cards were too thin and jammed frequently.

In 1977, Prepaid calling cards using magnetic strip authorization spread to the rest of Europe. In particular to Austria, Sweden, France, and The United Kingdom.

In 1978, inductive technology was invented by Nelson G.Bardini in Brazil. The system uses a series of coils embedded in the card. The card was first shown at a national inventors' exhibition in 1982.

In 1982, Japan's Nippon Telephone and Telegraph introduced the first Japanese pre-paid phone card. Japanese commuters had to use a large coin to operate payphones on their subways. The Japanese card was considerably more convenient and was sold to tens of thousands of daily subway riders in Osaka and Tokyo.

In 1984, France experiments with chip-based "smart cards".

In 1987, World Telecom Group is the first company to launch a significant phone-card product in the United States. GPT, a consortium formed by Siemens and General Electric Company, developed and issued cards with their own magstripe technology. This is now among the most widely used magstripe cards.

In 1988, the first catalog of telecards for phone card collectors was published by Dr. Steve Hiscocks, in England.

In 1989, AT&T enters the prepaid calling card market. The first remote telecards appeared in Hawaii.

In 1990. NYNEX (New York's RBOC or Regional Bell Operating Company) offers the first non-magnetic based calling card in the U.S. These were prepaid calling cards that used a PIN (Personal Identification Number) as a means of identification. Nynex's card permitted the cardholder to dial an 800 number and enter his PIN to make long distance phone calls. This method permitted the caller to make phone calls from any telephone anywhere in the U.S. without the need for coins or incurring hotel surcharges, encountering call-blocked numbers, or any of the other additional items routinely used to bloat public phone bills. Gold Line, Canada's leading provider, enters the Canadian market and spends 10 years growing to own approximately 50% of the market in 2001.

In 1992, all of the major regional and long distance phone companies including Sprint, and many of the smaller carriers were offering pre-paid phone cards. Industry-wide revenues reached $12 million with projections calling for double that over the next several years. This projection proved to be radically short of things to come.

In 1993. Phonecard sales exceed $25 Million, more than double that of the previous year.

In 1994, displaying exponential growth, calling card sales exceed $250 Million.

In 1995, sales hit $650 million. US West provides the first chip-based prepaid cards. Sprint releases "FONCARD" and Bell Atlantic temporarily discontinues its calling card efforts.

In 1996, calling card sales reach an unprecedented $1 Billion.

In 1997, sales reach over $2 Billion.

In 2000, sales of over $3 Billion are achieved with no end to the expansion in sight. Projected sales for calling card industry reaches 10 Billion dollars per year by the year 2010. The combined reach of the new markets has expanded the distribution of phone cards from a few hundred thousand in 1992 to hundreds of millions in 2003. Calling cards are now sold through virtually every conceivable channel, from convenience stores and corner cafes to vending machines. The prepaid international phone card now co-exists with and in many cases have replaced collect calling and coin pay phones as the preferred method of placing both domestic and international calls.Tel