Cell phone calls mean universities lose millions

By Stefanie Frith, The Associated Press
Monday June 24, 2002

SACRAMENTO – For 20-year-old Sadie Gardere, it just makes sense to call home on her cell phone. Instead of paying 9 cents a minute through Sonoma State University, she pays a flat fee of $45 a month to call her family in the Bay Area. 

In California, land of wireless communications, Gardere’s situation is not unusual. The Federal Communications Commission estimates that 61 percent of 18- to 24-year-olds carry a cell phone. And 3 to 5 percent of the country’s population has dropped standard telephone land lines for cell phone use only. 

But cell phone carrying students nationwide are costing cash-strapped public universities millions because they aren’t using the school-provided telephone services in residence halls and dorm rooms. While universities are only now starting to realize this, they say it’s only a matter of time before they will have to consider raising student costs to make up the difference. 

“I would imagine over time that if there continues to be a further and further drop, it would be reasonable to expect that there would be (an increase in tuition),” said Toni Beron, a spokeswoman for California State University, Long Beach. 

Years ago, becoming a mini phone company meant big business for universities, said Sherry Manning, director and CEO of Educational Communications and Consortia Incorporated, a national university telephone billing service. Universities become wholesalers, setting prices a little higher than what they paid for it, while still offering students a lower price than the local carrier. 

Eventually, however, students started using calling cards and long distance dialing such as 1-800-CALL-ATT because the advertising was aimed at the youth population, Manning said. 

“And now, everyone is shocked that students use the Internet and cell phones as much as they do,” she said. 

Travis Larson, a spokesman for the Cellular Telecommunications and Internet Association, a Washington-based wireless trade group, said it’s logical students would use cell phones because in the span of four years, they could live with a dozen different people and move four times. 

“Just imagine the nightmare at the end of the month trying to divide up the phone bill,” Larson said. 

Although many universities contract out phone services through their local telephone provider, many, like the University of California, Davis, have implemented their own switchboard. Either way, officials say, they are still losing out. 

“Schools are saying, I am an educator, not a telephone service,” Manning said. 

The University of California, Davis has seen a 12 percent drop in the last three years, San Diego State has lost 20 percent or $40,000 in two years, Cal State Long Beach a 40 percent drop and University of California, Santa Barbara has lost $500,000 in the last two years. Chico State has lost $400,000 in the last year. The University of Wyoming has seen a 66 percent drop in two years. Florida State University officials also said they have seen a “significant” decrease in revenue. 

And at the University of Rhode Island, student telephone billing has dropped from about $800,000 a year five years ago to just $100,000. Most campuses used the money to offset housing and telephone service costs. 

“Clearly it has been a problem,” said Paul Valenzuela, associate director of communications services at UCSB, which charges 10 cents a minute for long distance calls through its own switchboard. “The last couple crops of freshman have been more cell phone oriented. They are also using e-mail and instant messenger technology more.” 

As a result, some college campuses are going all wireless, dropping landline telephones and equipping students with cell phones and hand-held computers, such as Washington’s American University and the University of Southern Mississippi. 

Greg Roberts, director of marketing and national promotions at Cingular Wireless, said wireless providers are always trying to improve coverage, and campuses that go wireless will have some unique advantages. 

“Teachers could tell students class is canceled because of a snow day and students could access homework information and sporting events,” Roberts said. 

Others, like the University of Wyoming, are simply thinking of inventing its own calling card for students. UC Davis is lowering their landline phone rates to be competitive with wireless and telephone long distance companies. 

UC Davis charges less than it did two years ago, and students can tap into online Web services to subscribe for phone service when they enroll, said Doug Hartline, director of communication resources. 

But when cell phones can offer unlimited night and weekend minutes, as well as free long distance, the reasons are simple, said Gardere, the Sonoma State student. 

“I am renting a house next year with some friends and unless I run into a problem, I will just continue to use my cell phone then too,” she said. “It’s just easier.”