Believe it or not, pay phones are here to stay

March 18th, 2014 by Philip Brasor & Masako Tsubuku

Hello stranger: Pay phone in residential area of Sakae, Chiba Prefecture

Hello stranger: Pay phone in residential area of Sakae, Chiba Prefecture

Last December, during its end-of-quarter news conference, NTT announced that it would shorten the length of time for a basic call on public telephones when the consumption tax is raised from 5 to 8 percent in April. Since pay phones don’t give change and NTT discontinued its IC card service in 2006, it would have been difficult to pass the extra tax levy on to users, so the more logical scheme was to make a ¥10 call shorter. As it stands, ¥10 will get you 60 seconds of connection to a number within the same calling exchange during the day. After April it will be shortened to something like 58 seconds.

At the time it wasn’t exactly breaking news, and for obvious reasons. Who uses pay phones any more? As long as you have a cell phone you likely won’t even notice that pay phones still exist, but they do. According to a government white paper on telecommunications that came out last year and cited on the Sarayomi blog, as of March 2013 there were 210,000 pay phones in Japan. In 2002 there were 680,000. (The peak year was 1986, when there were 910,000.) That means two-thirds disappeared over an 11-year period.

Another interesting statistic is that there are more analog pay phones than digital ones. At one point around the turn of the millennium, NTT was keen on so-called IC data public phones, those gray ones with the phone jacks to which you could hook up your laptop. NTT stopped IC data service in 2006, so even if you see a gray pay phone it isn’t hooked up to a data line any more.

But even if the number of pay phones continues to dwindle, they won’t disappear entirely. They are considered necessary facilities in an emergency, so a minimum number will always remain. The problem for NTT is that very few people use them any more, and even those who do don’t use them as much as they used to (85 percent of revenues come from local calls; people who use pay phones are more conscious of the money they are spending than are cell phone users).

In other words, public phones no longer pay for themselves. They still cost money in terms of maintenance and rental for the space they occupy. In 2012, revenues from public phones stood at ¥7 billion, but the cost of keeping them running was ¥12.5 billion.

So who pays the difference? Well, you, of course. If you have a land line or a cell phone there is an item on your monthly bill called a universal service fee, which is now about ¥3 (it used to be ¥5), but that only covers half the shortfall, so some people are saying that it should be doubled, especially since the Great East Japan Earthquake, when pay phones were the only means of communication for some people.

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