Payphone - United States

United States

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 hard-wired 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.

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 had declined by 58 percent.