Phonepoint

~ the obit ~

Three thousand three hundred base stations. Fewer than a thousand subscribers. Britain's first telepoint network finished its life with more than three transmitters standing on the street for every single customer it had managed to sign, which is the ratio you get when a government hands out licenses for a technology before anybody has checked whether it answers a question people are asking.

The licensing came first and that is most of the story. On 28 July 1988 the Department of Trade and Industry announced telepoint, and in January 1989 it awarded four licenses at once. The common air interface, CT2, was only settled in May 1989, three months after the licenses were already in hands. Phonepoint was the consortium that moved fastest: STC and British Telecom with France Télécom and Nynex behind them, live across London and the South East in August 1989.

What you bought was a cordless handset that worked against your own base station at home like any cordless phone, and then also worked against the operator's base stations when you were out. The handset was £245 and the home base station another £195. On top of that came £8 a month, with calls running from 10p to 55p off peak. Against a cellular phone in 1989 those numbers were genuinely cheap, and the cheapness was the entire pitch.

I was five years old and living in a country that would not have a mobile network of any kind for another five years, so this one sits well outside anything I can claim to remember. It reaches me as a document rather than as a memory. What holds my attention is not the failure but the shape of it, because Phonepoint failed in a way that is still legible thirty-five years later from the numbers alone.

~ the rap sheet ~

~ what you actually bought ~

The defect was structural and everybody knew about it before launch. A Phonepoint handset could not receive calls away from home. The base stations on the street were transmitters you walked up to and used, not a network that knew where you were, so there was no way to route an incoming call to you. You were carrying a payphone that happened to be in your pocket, and the only advantage over the actual payphone twenty meters away was not having to queue for it.

Coverage worked the same way. A CT2 base station reached about a hundred meters, so using the service meant knowing where the boxes were and walking to one. Phonepoint put them on high streets and at transport hubs and marked them with signs. Users learned the map or they did not use the service, and most people, offered a phone that requires them to memorize a map, decided they did not want a phone.

~ what went wrong ~

BT's own explanation afterward was that the August 1989 launch had been premature, that a saleable product had not been created as it should have been. That is a franker admission than companies usually make and it is also true. Handsets were scarce at launch and the base station rollout trailed the marketing that promised it. Meanwhile the four licensees spent 1989 and 1990 racing each other into the same undersized market rather than working out whether the market existed.

The other three did no better. Ferranti's Zonephone went live inside the M25 in October 1989 and closed in July 1991. Mercury's Callpoint launched on 4 December 1989 and closed that June. Phonepoint outlived both and was gone by 1 October 1991, at which point Britain had run three national telepoint services into the ground inside twenty-six months. Hutchison then launched Rabbit in May 1992, which is the part of this story that stops being a business decision and starts being a curiosity, and Rabbit was dead by the end of 1993.

~ what survived ~

Cellular is what beat it, and not by being better at what telepoint did. GSM handset prices fell while coverage widened, and both of those movements attacked the only argument telepoint had. A cheap phone that cannot ring loses to an expensive phone that can, as soon as the expensive one stops being quite so expensive. The window in which the trade made sense was perhaps four years wide and the industry spent most of it getting licensed.

The technology itself was not wasted. CT2 became DECT, and DECT went on to win the cordless phone completely, sitting on hall tables across Europe for the next twenty years. The standard survived by giving up on the street and going back indoors, where the hundred meter range and the missing handover were not problems at all. Phonepoint's mistake was never the radio. It was the belief that a home technology could be talked into being a public one.

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