How I Started in Telecoms
In 1993/1994 I formed a new Telecoms company, using my investment knowledge and expertise, to raise approximately £400,000 from professional investors.
I presented the business to potential investors at one of the meeting rooms available in the large building known as Telehouse based in London’s new Docklands area.
Telehouse is a Data Centre specialising in providing secure and essential facilities for bespoke servers, such as internet access and power supply, with back up facilities to ensure maximum “up time” or uninterrupted service – particularly important for a telecoms business. It also provided easy access to other telephone networks.
NPC Rationale – Business Opportunity with Phonecards
At this point in time, the telecoms market in the UK was dominated by two companies – the long established National Telecoms Operator, British Telecoms (BT) – and the relatively new Mercury Communications part of Cable and Wireless. BT had effectively had a monopoly for many years, and Mercury was formed to break that monopoly. However, both companies charged high prices for phonecalls, particularly to international destinations,
Many calls were made using a payphone or phonebox which accepted coins (cash). However a new telecoms product had been developed some years earlier which was the Telephone Card, or phonecard, as it became widely known. Of particular interest to me was the prepaid phonecard using a remote memory system, which could be used in Payphones – or from any other telephone – by first dialling a Freephone or Toll-Free number.
Requirements
In 1993, to be able to offer a phonecard service, there were three major requirements.
The first was to have our own “telephone exchange” or telephone “softswitch” and the most important feature of the “switch” – or computer software – would be the Billing system, which would ensure that the correct charge would be made for any call, and the credit balance on the prepaid phonecard carefully monitored. This crucial software solution was produced by Gideon Goldschmidt – see below for more info on Gideon.
The second requirement was to obtain the Toll-free numbers that would be promoted on each card, and would carry the incoming call to the server hosting our telephone softswitch, which would be situated at Telehouse.
The third requirement was to be able to connect the customer’s outbound call to the required destination, which meant that we needed agreements in place with Telecoms Companies (Carriers) who could provide such a service, either for national or international calls.
There were several businesses in the UK offering to produce or manufacture phonecard products – basically credit card sized plastic cards – which could then be branded, and carry the PIN (secret password under a “scratch-off” panel) together with the appropriate Freephone or Toll-Free access number.
The Unique Selling Point (USP) for the new business was that we could offer telephone calls far more cheaply than the established UK Telecommunication Networks – BT and Mercury – particularly calls to international destinations.
Our potential UK market included Tourists, Students, small businesses, anyone who did not have a landline available at home or indeed anyone who needed to make cheaper international calls. Two of our early customers were the Royal Air Force and the Royal Navy, for whom we produced special telephone cards depicting stirke aircraft and the famous carrier the Ark Royal. This of course pre-dated by 30 years the Mobile Phone, and Communication Services via the Internet widely available today (2021).
The new company’s offices were on the top floor of 63 Duke Street London W1, the offices I had taken over following the demise of Noble Warren Investments Ltd.
