Cisco 7936 IP Conference StationHave you ever wondered how companies like Freeconfernececall.com or gotomeeting.com make money? From 50,000ft it seems like their revenue is derived from up sales to premium packages etc.

I was stunned to figure out each time a conference is bridged these companies are essentially watching the clock and counting the dollars.

It seems the most cleaver of arbitrage opportunities is a service we use everyday, and these companies are making million by sticking it to the man…Who’s the man?

  • AT&T

  • Verizon

  • Sprint

  • T Mobile

Your large carriers are paying the price, but i guess on a macro view  its ultimately you and I..but well leave Friedman and Microeconomic out of it for now

Essentially this is how it works:

Due to federal regulation small rural towns can charge carriers (mentioned above) more per call connection because it cost more per capita to install and maintain the lines. this is why all conference call area codes are in some obscure place. Thus free conference call companies partner with rural towns that are legally allowed to charge up to 10-20X the amount of an intercity call. Both the small city telecom company and the free conference company win. Win Win right? Wrong?

On a Micro level i guess all cost is passed to the consumer but its confirmed that free conference calls are costing large carriers Millions/ yea

Its a crazy world we live in.  Ezine’s Lee Simonson has a great article on the details. —->http://ezinearticles.com/?Whats-the-Catch-With-Free-Conference-Calling?&id=3654224

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