Big company versus little company
I currently work for a world wide company that manufacturers telecommunications equipment, installs telecommunications equipment, repairs it, sells parts, services facilities. This is only one huge portion of my company's world wide product lines. They do many other things. I'm going to be using examples from the business to point out a trend I see in other big companies and in particular this business. It points to corporate greed in a big way.
There are now 3 main players in the cell phone industry, soon to be 2 if a merger goes through. You all know who they are. None of them want to service rural areas anymore because the big profit margins are in the large metro markets.
Right now most people have pretty good cell service no matter where they are. Rural areas get just as good of coverage as larger areas. That is likely to change and soon.
One of the big players sold a huge chunk of their rural business to a smaller player. My company still gives the big players their huge discount, but will not give this same discount to the smaller company. So now the cost to repair and purchase equipment for the smaller markets is starting to rise.
It used to be that a big company might run small profit margins in certain areas and make up for it with large profit margins. Now the whole focus is on the size of the profit margin. They all want to only service the large profit margin areas and don't care if the smaller markets get service.
I'm sure some of you will applaud this capitalistic viewpoint in that making profit and as much as possible is what it is all about, but I don't think you're going to like what happens when the effects of these policies start to really take hold.
You work for Verizon, I take it? 
I live in a rural area and no one I know can get cell coverage anywhere within 3 or 4 miles of my house. I hate to think it's going to get even worse.
i miss the old days when even big companies recognized that providing good service at a fair price fostered customer loyalty, often for generations.
(those days existed, right?)
My company doesn't run wireless. They supply all the stuff so that wireless runs. We are actually bigger than Verizon.
Original Post by pgeorgian:
i miss the old days when even big companies recognized that providing good service at a fair price fostered customer loyalty, often for generations.
(those days existed, right?)
Yes, those days did exist.
Oh I know what's coming down. I work for an ILEC (Independent Local Exchange Carrier....a phone company) and we're affiliated with a small cellular provider in a rural area of CA. We're going back to the days before the Telecommunications Act of 1934 in many regards.
And with the rampant theft (in my general area at least) of copper wire for both land line and cell phone equipment, and the ongoing repairs that must be done for just that, what you're saying is that it may not get fixed; will get fixed, but costs will be even higher and thus passed on to the customer; or repairs may not be immediately made.
Sounds like the customer gets shafted again.
We do. Next time you look at your phone bill, you'll see a charge called Universal Service Fund (USF). That is a fee that the large telcos charge, per the Telecommunications Act, that goes into a kitty and is disbursed amongst the rural telcos. It's expensive doing business up here. We cover many, many miles just to reach 1 or 2 customers. Boy I could tell you stories.
Original Post by janelovesjam:
Go on, then!
(I'm Canadian. But I don't know as much as I should about our own telecomms issues, which I understand are vast.)
I'd be happy to, but this is Mooni's thread and I believe her purpose is something other than me telling stories of "life in a rural telco", so I'll wait and defer to her before I continue. I hope you understand.
Original Post by meganr:
I live in a rural area and no one I know can get cell coverage anywhere within 3 or 4 miles of my house. I hate to think it's going to get even worse.
I've had service with three cell phone companies (the first one got bought out by the second one, and I just switched to a third) and have never had cell phone reception in the rural area where I've worked for over 6 years. I move into a service area when I drive about 12 miles toward the nearest city.
I agree with the OP.
Companies used to be satisfied with a modest profit margin. That is increasingly not the case. People want to see double digit profit and double digit increases to profit every year.
Meanwhile, average income in the U.S. has fallen 6% since 2007. And that doesn't really tell much actually. Back out the top 5 % and then measure how much average income has fallen - it will be a lot more than 6%.
Original Post by pinegrovedave:
We do. Next time you look at your phone bill, you'll see a charge called Universal Service Fund (USF). That is a fee that the large telcos charge, per the Telecommunications Act, that goes into a kitty and is disbursed amongst the rural telcos. It's expensive doing business up here. We cover many, many miles just to reach 1 or 2 customers. Boy I could tell you stories.
That subsidy doesn't even touch the extra costs that smaller telcos have due to pricing like ours.
For example, our standard breakers cost us about $5.00. The big 3 can buy these breakers for $12.50 to $15.00. The little guys have to pay $50.00. Now our company doesn't even want to do service calls in the rural areas.
I thought the government put the brakes on that merger?
*off to google*
I googled it a couple of weeks ago and it had been suspended, but not completely permanently denied. It was in limbo and it was being lobbied heavily.
Original Post by moonikins:
Original Post by pinegrovedave:
We do. Next time you look at your phone bill, you'll see a charge called Universal Service Fund (USF). That is a fee that the large telcos charge, per the Telecommunications Act, that goes into a kitty and is disbursed amongst the rural telcos. It's expensive doing business up here. We cover many, many miles just to reach 1 or 2 customers. Boy I could tell you stories.
That subsidy doesn't even touch the extra costs that smaller telcos have due to pricing like ours.
For example, our standard breakers cost us about $5.00. The big 3 can buy these breakers for $12.50 to $15.00. The little guys have to pay $50.00. Now our company doesn't even want to do service calls in the rural areas.
Why does it cost the little guy $50? Is that labor and stuff too?
It costs the little guy $50.00 because that's what price we tell them they have to pay. That is just the cost of the part itself to them even though we are paying $5 for it whether we sell it to big 3 or to little guy. We give the big guys huge discounts off the list price. Little guy pays list price.
Original Post by moonikins:
It costs the little guy $50.00 because that's what price we tell them they have to pay. That is just the cost of the part itself to them even though we are paying $5 for it whether we sell it to big 3 or to little guy. We give the big guys huge discounts off the list price. Little guy pays list price.
Seems like a great opportunity for one of your competitors to jump in and steel all of your rural business.
They don't have to steal it. My company doesn't want it. The competitors don't want it either. They only want the big markets too.
Original Post by floggingsully:
Original Post by moonikins:
It costs the little guy $50.00 because that's what price we tell them they have to pay. That is just the cost of the part itself to them even though we are paying $5 for it whether we sell it to big 3 or to little guy. We give the big guys huge discounts off the list price. Little guy pays list price.
Seems like a great opportunity for one of your competitors to jump in and steel all of your rural business.
The little guys probably don't buy enough of them to make it worth it for another company. sigh
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