News and Views

Unocal Disaster?

The hot news this week has been the controversy of dumping a product. Particularly, we are talking about the Unocal 76 phonecards that were available last summer in the Southern California area. This promotion was supposed to be for a limited area only. Many collectors drove pretty far to buy gas and get the cards. If I had been in Los Angeles at the time, I probably would have joined them. There are two types of cards available - A 10 minute card, and a 30 minute card. The 30 minute card could be purchased at the station, the 10 minute card was supposed to be purchased only with gasoline. Since the cards were only available in a limited geographical area, the secondary market value of the cards reflected this relative scarcity. A fifth card became available after the promotion ended, which I and other collectors thought was strange, but it seemed as difficult to acquire as the others. It was not uncommon to see the five card set sell for $50. In fact, the set sold for $60 in one of my auctions last Fall.

Now, the problem. A large ad placed on the back cover of a phonecard magazine shows that a company called Winston Taylor is offering these cards through four large dealers at blowout prices - $15.95 for the five card 10 unit set, and $29.50 for the five card 30 unit set. There are a number of problems that many of us have with this scenario. Before go into details, I need to explain the difference between product dumping and dealer blowouts. When a dealer has product that does not move, what will happen is that they will lower the price below cost to move product. This frees up capital, and allows the dealer to purchase items that will sell. If this is done occasionally, I can see no harm. If it is done frequently, it can destroy an industry. Look no further than the sportscard industry. Name one 1995 product that sells for more than it did when released. Dealers sit on product about a week, and begin dumping it. The bottom line is that very few people pre-order merchandise anymore, and this hurts dealers and the industry. While dealer dumping is morally ethical, manufacturer dumping is not. An example of this situation besides the Unocal cards is the Pepsi Congo cards. There were 5 million of these available, but a number of dealers reported being offered these cards in quantity. According to the rules of the contest, the only way to win this card was to drink soda and see if you were an instant winner. There was also a second chance drawing, in which I participated and won a few cards. There should be no way for a dealer to get quantity of promotional cards. If they do, that means that someone is moving the product out the back door. I don't blame the dealers for this, if they do not take the product there will be someone that will. I blame the people responsible for the distribution of the promotional cards. This really ruins faith in the promotion. People who follow the rules get screwed, people who buy the cards at the market price get screwed, dealers who sell the cards at the going rate must lose customers when the prices drop so much, because that customer is upset they paid so much for a product that is worth considerably less. Don't get me wrong - I am not saying that I expect all product to go up in price. Anyone who purchases a collectible should know that there are risks, and I do not advocate purchasing a collectible as an investment. However, in this case I am upset because the producer of the card did not play the game fair, and this really disturbs the precious balance of supply and demand. I'll have an update on this situation in future weeks. For now, many of us are waiting for Larry Brilliant to make a statement on this situation. I do not want to pass unfair judgment on his company until more facts are in.

Steve Young Fan Club

For a price of I believe $29.99 (I could be wrong, my printer messed up the line with the price) you can be a member of the Think Young Fan Club. You will get a T-shirt, baseball hat, fan club water bottle, newsletters, and of course a 5 minute phonecard. Call (800) 863-8932 for more information

Western Union Giveaway

Buy any Western Union Phonecard (from Western Union) and receive a free $10 phonecard until 12/31/95

LAX Phonecard

For those who do not know, that is Los Angeles International Airport. It has been reported that a $20 AT&T phonecard is being sold there in vending machines. Unfortunately, I will not be flying out of LAX for quite some time, and as a veteran flyer from that airport, approach at your own risk. I don't think I would go there for a phonecard.

MCI/Smithsonian Cards

MCI will be producing cards that show some of the treasures of the Smithsonian starting early next year. For those who have not been to the Smithsonian, it is a worthwhile visit (Of course, if you plan to see all of the buildings it could take days, I have been there twice and have only seen a fraction of the display) If you are from the Southern California area, fly out of LAX and make it a total phonecard experience!

MCI On-Line

MCI now has a phonecard area on-line. They sell their phonecards (of course) but also have an area on collecting. I did have to send them feedback, as they listed the famous 1992 NYNEX Democratic convention cards as being worth $1500 each (I think one sold for $300 recently on CompuServe) - Check them out at

http://www.internetmci.com/marketplace/prepaid/

Promotions

More Cereal

Buy a box of Multi Bran Chex (yuck!) and have a chance of winning a 10 minute phonecard. I do not know what the odds are, but it is not 1 per box, so beware when buying this cereal!

Tuff Stuff

Subscribe to this sportscard and memorabilia publication, and receive a free Lou Gehrig/Babe Ruth phonecard. I do not have their phone number handy, but I believe it is an 800 number

Free Sprint Card

Point your web browser to

http://www.sprint.com/welcome/survey.html

and fill out a survey - Your reward - A 5 minute Sprint phonecard. Not bad!

ABC Monday Night Football Giveaway

Main Street Marketing is giving away a set ($65 Value) of Monday Night Football Phonecards. You can point your browser to their homepage (Located at the same place the Phonecards On-Line is archived) at

http://www.cardmall.com/mainstreet/market.htm

Read the rules and enter this contest - Ends 12/31/95

Until Next week, Happy Collecting

Alan

Distribution

Phonecards On-Line is available via:

1) On-Line on the World Wide Web. The address is: http://www.cardmall.com

2) Direct e-mail. I'll be setting up a mail distribution system from my internet account. For those who have not already joined this mailing list, my e-mail address is: phoneline@cardmall.com

Until Next week,

Alan