A payphone or pay phone is a public telephone, often located in a phone booth or a privacy hood, with pre-payment by inserting money (usually coins), a credit or debit card, or a telephone card.
Payphones are often found in public places, transportation hubs such as airports or train stations, convenience stores, malls, casinos, and on street corners. By agreement with the landlord, either the phone company pays rent for the location and keeps the revenue, or the landlord pays rent for the phone and shares the revenue. Some payphones, particularly at gas stations, are mounted in drive-up structures that can be used without leaving the vehicle.
Payphone revenues have sharply declined in many places, due to the increased usage of mobile phones. Payphone providers have sometimes tried to reverse the decline in usage by offering additional services such as SMS and Internet access, thus making their phone booths into Internet kiosks. The abandonment of payphones by telephone companies has angered some people who consider them a communication staple for low-income and low-credit consumers. In particular, payphones are useful for foreign or generally non-local travelers who need to place local calls, as well as those who simply don't like or cannot afford mobile phones.
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Payphones were preceded by pay stations, manned by telephone company attendants who would collect payment for calls placed. In 1889, the first public coin telephone was invented by William Gray and installed at a bank in Hartford, Connecticut. The invention quickly caught on, and by 1902, there were 81,000 payphones in the United States. By 1905, the first outdoor payphones with booths were installed. By the end of 1925, 25,000 of these booths existed in New York City alone. In 1960, the Bell System installed its one millionth telephone booth. After the divestiture of Pacific Bell (California) and AT&T in 1984, it wasn't long before independent stores selling telephones opened up. After that privately owned payphones hit the market. In 2000, there were over 2 million payphones in the United States, today that number is around 700,000, the major carriers AT&T and Verizon have both exited the business, and this market is served by independent payphone companies now.
In recent years, deregulation in the United States has allowed payphone service provided by a variety of companies. Such telephones are called customer-owned coin-operated telephones (COCOT), and are mostly kept in as good condition as compared with a payphone owned and operated by the local telephone company. COCOT contracts are usually more generous to the landlord than telco ones, hence telco payphones on private premises have been more often replaced than street phones. One common implementation is operated by vending machine companies and contains a hardwired list of non-toll telephone exchanges to which it will complete calls.
In the United States, the coin rate for a local direct-dialed station-to-station call from a payphone has been 50¢ in most areas since mid-2001, for an unlimited number of minutes. During the 1960s and 1970s, the same call in the United States and Canada typically cost 10¢. In inflation adjusted terms, in 2006 USD, this was 68¢ in 1960, and 28¢ in 1979. While some areas only cost 5¢, smaller companies occasionally charged as high as 15¢ to 20¢. In the late 1970s and early 1980s, this price gradually changed to 20¢, and again rose to 25¢ in some areas between 1985 and 1990 (47¢-39¢, inflation adjusted terms as above). In the late 1990s, the price rose to 35¢ in many areas. However, in most areas in California, for instance, the price is very often 50 cents a call (note that pay telephones rarely, if ever, accept 50 cent pieces (half-dollars). New York City is a notable exception, where Verizon's and other companies' phones still cost 25 cents for 4 minutes, except in hotels and airports. Verizon tried raising the price to 50 cents, but lowered it to 25 cents after customers started using their competitors' phones.[1]
In the United States, a payphone operator collects an FCC-mandated fee of 49.4¢ from the owner of a toll-free number for each call successfully placed to that number from the payphone. This results in many toll-free numbers rejecting calls from payphones in an attempt to avoid this surcharge; calling cards which require the caller to dial through a toll-free number will often pass this surcharge back to the caller, either as a separate itemized charge, a 50¢ to 90¢ increase in the price of the call, or (in the case of many pre-paid calling cards) the deduction of an extra number of minutes from the balance of the pre-paid card.
Between 2007 and 2008 the number of payphones in the United States in operation declined by 58 percent. In places such as Toledo and surrounding suburbs, pay phones have been removed from restaurants, retail, and other public facilities. [2]
Most payphones in Canada are owned and operated by large telecom providers like Bell, Telus and Sasktel. In the last 20 years customer-owned coin-operated telephones (COCOT) have also appeared in the market, but their numbers are smaller due to emergence of cellular phones.
Pricing on most local payphone calls is now 50 cents CAD, having increased from 25 cents in the past few years. Pay phones in Alberta were 35 cents for a time, but in most jurisdictions the price simply doubled. Newer phones allow users to use calling cards and credit cards.
Dialing 0 for operator and 911 calls are still free.
In the UK, as in the USA, payphones have been deregulated. The great majority of them are still operated by British Telecom but there are other providers, mostly in urban areas. Manchester, London, Cardiff and Glasgow at the turn of the 21st century have a greater concentration of non-BT payphones. BT has steadily been removing payphones throughout the UK since 2000 where BT deem the kiosks not to be profitable, and have few or no calls made in any given financial year.
BT however is offering local communities the option of adopting [3] the iconic Red K6 Kiosks due to strong opposition from the communities that the kiosks reside in. This will mean the removal of the phone, leaving the empty kiosk in-situ. A bizarre feature of the adoption contract is section 5.5.4 which prohibits the re-installation of a telephone in the kiosk.[4] BT has been asked to delete section 5.5.4 (because it is anti-competitive) but it has refused. Ofcom has been asked to refer the matter to the Competition Commission but Ofcom has refused to make the referral.
Another option BT has provided is the sponsored kiosk,[5] that will retain the phone service, and retain the kiosk for an annual fee of around £300 +VAT, whether it is the Red K6 or the newer Aluminium and Glass Kiosks that cannot be adopted.
From June 1, 2010, BT payphones have £0.60 minimum charge which buys the first 30 minutes of any direct dialled national geographic call. Previously the minimum charge was £0.40 for the first 20 minutes of any direct dialled national geographic call. Then before November 2006 the minimum charge was £0.30, before 2004 it was £0.20 and before 2000 it was £0.10. However, making a call using a credit/debit card incurs a minimum charge of £1.20, and includes 1 minute of call time, £0.20 per minute thereafter, as of September 2011.[6]
A BT Chargecard[7] is a considerably cheaper way to call from any UK landline, including Payphones. Other cards which can be used are the Post Office phonecard,[8] Tesco international calling card[9] and many other telephone cards which can be bought from newsagents.
The high cost of calls is a deterrent to use and has led to allegations of closure by stealth.
Australia has two major payphone operators: Telstra and Tritel.
Telstra has removed some of their payphones, believing them less necessary than in the past. They do not make a profit, because they are used less often and are frequently graffitied, vandalised, smashed and deliberately have their coin slots jammed.
Telstra Payphones are regulated at 50 cents a local call by law and some payphones also have the ability to SMS at 20 cents a message. Some Telstra payphones, especially ones in central city locations, have a teletypewriter facility. Generally, Telstra payphones accept all Australian coins, and Telstra Payphone Cards. However, Telstra has made a security move with most of their payphones, ensuring that money, including change, cannot be retrieved from the machine without opening the cashbox. This was done to stop theft as well as encourage patrons to use Payphone Cards, provided by Telstra. 1800 numbers are also charged free, and therefore a variety of calling cards, such as the Telstra PhoneAway, which has a 1800 number can be called and used too. Telstra payphones can also call +800 (dialled as 0011800 + 8 digits), and 1100 (Dial Before You Dig) without payment. It is also possible to use both Telstra's Telecard and Optus's calling card (which operates on 189xy service numbers) without payment at the payphone.
All payphones can call emergency services (000) without payment.
Telstra has payphones at almost every railway station, on some major streets and in some government buildings.
TriTel operates payphones generally on lease sites - therefore they are usually located inside shopping centres. Most shopping centres, particularly newer ones, will have a TriTel payphone instead of Telstra payphones because it seems TriTel is more lenient in installing payphones.
TriTel payphones are charged at 50 cents per 15 minutes for a local call and most 1800 calls.[10] They accept all Australian coins (Telstra payphones do not accept 5c coins) and TriTel payphone cards which are sold at newsagents. 1800 Reverse (for collect calling) and 1800-TRITEL (their customer service line) can be called without payment at the payphone.
Private payphones can be installed. Most are bought from Telstra, however some can be bought through other special payphone specialists. There are two predominant types of private payphones, one of them no longer supported.
Gold phones used to be very popular and were installed generally in large restaurants/cafes, small shopping centres and other places where there were staff (as the phones were easily vandalised or even stolen due to their compact size) and there wasn't a need for such a big full size payphone. Gold phones were generally small, and had the dialpad and handset on the top of the machine. Gold phones only accepted coins, and had to be wired up to a special payphone subscriber line to allow charging.
Blue phones still seem to be working and are now more popular in the absence of gold phones. They are installed where gold phones were installed, and at some schools. These phones are smaller than their gold phone counterparts. These phones have a front which is slanted/angled and have a dialpad, a small 1 line LED screen and a handset. On the top of the machine is a coin slot. These phones accept coins only, and also need to be wired up to a special payphone subscriber line to allow charging, otherwise calls will not be metered and will go through for free.
As of 30 March 2009, the 50 Hz Metering System was switched off nationwide, meaning unmodified goldphones were rendered inoperable. Bluephones, however will still operate if the owner changes the phones metering settings, done by changing a DIP switch inside the phone (blue phone can recognize either 50 Hz or 12 kHz meter pulses).
However, as mobile phones come to predominate, there is a decrease in payphone usage, except in rural, remote and non metropolitan areas where mobile coverage does not exist.
All payphones on the street and in buildings in Japan are installed and maintained exclusively by Nippon Telegraph and Telephone (NTT).
In the 1995 film Hackers, the characters Razor and Blade briefly explain how to manipulate payphones to make free calls.
In the Teenage Mutant Ninja Turtles live action movies 1 & 2, there is almost always a payphone in the Turtle's lair.
In the film trilogy The Matrix, telephones are used to exit from the matrix.
During his trial, American hacker Kevin Mitnick was accused of having the ability to launch nuclear missiles by whistling into a payphone.[13]