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International Phone Cards
The prepaid calling card has its roots in the international market. These cards were initially created to fill a need, but once they were created, their convenience and value were immediately recognized. Here, we'll take you on a whirlwind tour of phone card history, then bring you back to the present to update you on an industry that is growing at an unprecedented rate. Armed with that knowledge, you will be able to make informed decisions when you purchase your own phone card.

Picture it: Italy, 1975

A shortage of coins in Italy in 1975 prompted the vandalism of thousands of pay phones - thieves began breaking public phones in order to steal coins. In 1976, a vending machine manufacturer and supplier called SIDA came up with a way to avoid this and introduced the first magnetic strip international phone cards so people wouldn't need to use coins to make a call. But they could only be used on certain phones, as people were required to insert the card into the phone to use them, and many of the cards kept jamming.

Still, other countries recognized that the advantages of international phone cards far outweighed their disadvantages and soon adopted the magnetic strip technology for their own international phone cards. The first countries to join Italy in using calling cards were Austria, Sweden, France, and the United Kingdom.

Next stop: Brazil, 1978

It was Nelson G. Bardini, a Brazilian scientist, who developed the inductive technology used in calling cards. This technology involved a system that used a series of small coils embedded in the phone card. One of the coils was designed to burn out after the time on the card had been used up. Although created in 1978, this technology wasn't presented to the world until the national inventors' exhibition in 1982.

Around the world: Japan, 1982

The same year that inductive technology made it's world debut, Nippon Telephone and Telegraph, a Japanese country, introduced their first prepaid calling card. This development was also a response to a growing need: when using pay phones in Japan, users were required to use a large coin to operate the public phones on the subways. The phone card was extremely popular in Japan, and tens of thousands were sold daily to subway commuters in Osaka and Tokyo.

Back to Europe: France, 1984

France, who had introduced their international phone cards shortly after they were introduced in Italy, began working on ways to improve calling card technology. The French wanted to increase the convenience of the magnetic strip by inserting a computer chip into the cards. This was the beginning of "smart cards."

Across the sea: United States, 1987

In 1987, World Telecom Group, a partnership comprised of the companies Siemens and General Electric Company, was the first to launch phone cards in the United States. This partnership developed their own technology, known as "magstripe." This technology is now one of the most widely used of its kind.

And back again: England, 1988

In 1988, collectors recognized phone cards as an interesting collectors' item and began collecting them much like they collected sports cards. The advent of phone card collection spurred Dr. Steve Hiscocks to create "The Collectors' Book of Telephone Cards," the very first catalogue of telephone cards. The publication covered 61 countries, or all those producing international phone cards at the time, with the exception of Singapore and Japan. The book was an incredible 108 pages!

The phone card revolution: United States, 1989

By this time, all U.S. phone companies wanted to be a part of the "phone card revolution." The first company in line was AT&T, who quickly introduced their own prepaid calling card. Contemporaneously with this, the first remote telecards also appeared in Hawaii.

The next company to get a piece of the calling card pie was New York's Regional Bell Operating Company (NYNEX). In 1990, they came out with a much simpler phone card: the first non-magnetic-based calling card in the U.S. NYNEX's prepaid cards used personal identification numbers (PINs) that identified the cardholder. This made international phone cards even more convenient. All the cardholder had to do was dial an 800 number and enter his PIN to make a long distance phone call. This allowed callers to make calls from anywhere in the U.S.

By 1992, all major U.S. phone companies had jumped on the bandwagon and were offering customers prepaid calling cards. Revenues throughout the industry were through the roof, reaching $12 million with projections of double that over the next several years. However, those projections were wrong. Phone card sales skyrocketed far beyond anyone's expectations, and continue to do so today. To see for yourself the incredible growth this industry has experienced, check out these figures:

  • 1993 – over $25 million
  • 1994 – over $250 million
  • 1995 - $650 million
  • 1996 - $1 billion
  • 1997 – over $2 billion
  • 2000 – over $3 billion
  • Projections are now $10 billion per year by 2010
In 1995, US West introduced the first chip-based prepaid cards in the U.S., while Sprint offered their own version of calling card, the "FONCARD." In 2001, the first disposable cell phone calling card was introduced. All these facts point to some amazing growth!

Making the world a smaller place

Calling cards have made reaching anyone anywhere in the world as simple as picking up the phone. From Italy in 1975 to the present day, phone cards make the world a smaller place. Doubtless, the Italians had no idea of the impact their invention would have on the world. Maybe it's time you got in on the action and purchased your own phone card today!


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