Dart Drug Stores Inc. wants to be your phone company. So do Giant Food Inc., the metropolitan Washington airports and even Clyde's Restaurant at Tysons Corner.
They all want the same thing -- either to own the pay phones on their premises or contract with a company other than Chesapeake & Potomac Telephone Co. to install and maintain them, giving them a much larger commission than they now get from C&P.
And they are counting on being able to do so as soon as this summer, after agencies in the District of Columbia, Maryland and Virginia issue rulings opening up about $100 million in annual revenue that now goes to C&P to competition.
Since the first state, Minnesota, opened up the ownership of pay phones a year ago, and the Federal Communications Commission ruled that privately owned pay phones could be connected to the network, 21 other states have allowed the service.
Across the nation, new contenders will vie for about $1.2 billion a year in local calling revenue and about $2.3 billion a year in long-distance calling revenue from pay phones, according to William Moorhead, a consultant with the Washington-based Partridge Group.
There already are at least 45 companies marketing more than 60 kinds of coin phones costing between $2,000 and $4,000 each, he said. Many of the phones are "smart," meaning they are computerized and can perform self-diagnostics or notify a central computer when the coin box is full. Still others can accept major credit cards.
Until now, local phone companies have installed public telephones and paid businesses a "very minute" amount in monthly commissions from the revenue the phones brought in, said Darryl Bryant, senior vice president for finance for Dart Drug Stores Inc., a 73-store chain based in Landover, Md.
No more. "There is no doubt there will be an increase in revenue with the new system," he said. "We have been approached by some people in that business. . . . We'll probably go with having a vendor provide the equipment."
Dart Drug stands to make about $140,000 a year from its 115 pay phones. That translates into a 20 percent commission, up from the 2 percent, or $14,000 a year, C&P pays the drug-store chain now, Bryant said.
"Of course, Giant is looking into it," said Susan Challis, a spokeswoman for the 133-store Washington-area food store chain. "There is no reason why we wouldn't go with it."
"We're looking at all the options," said Clyde Bingman, manager of business operations for Washington National and Washington-Dulles International airports. "Right now, we have a 90-day contract with C&P and can cancel it if we see a clear trend in the industry."
Airports are one of the principal generators of revenue from coin phones, he said. The 460 airport phones at National and Dulles currently earn an 8 percent commission of $350,000 a year, but the airports could be earning many times more under deregulation.
John Laytham, executive vice president of Clyde Inc., parent of Clyde's Restaurant at Tysons Corner, the Old Ebbitt Grill, Clyde's in Georgetown and Clyde's in Columbia, Md., said his company plans to buy its pay phones.
"If we do it, we'll buy and install our own," he said. "We can easily make $15,000 or $20,000 a year in profits -- that's something you can't pass up, even if it's a pain in the neck to do something about it."
Officials at the District of Columbia Public Service Commission, Virginia State Corporation Commission and the Maryland Public Service Commission say the subject will be ruled on in the coming months.
The Maryland Public Service Commission, together with C&P and those who want to provide the service in Maryland, already has drafted a set of rules.
The agreement in Maryland would require coin phone operators to pay C&P $16.20 a month per line, 10 cents of every 25-cent coin call and $6 a month per line in access charges. There would be additional fees for other options such as touch-tone and call screening.
Businesses would not be allowed to charge more for local calls than the phone company does and would have to provide free access to an operator and 911 emergency service. Customers would be able to dial directory assistance, and the phones would have to have a coin slot for returning coins, be compatible with hearing aids and clearly display the owner's name, telephone number and charges for long-distance calls.
Business owners would be free to charge the highest day rate for long-distance calls no matter what time they were made.
The Virginia State Corporation Commission has been getting seven to 10 calls a day about pay phones, said William Irby, manager of rates and costs in the communications division.
"We've gotten an awful lot of interest," he said. The commission has compiled a list of rules and would require businesses to pay C&P 10.6 cents per call plus a flat monthly fee for the line, he said.
The commission, which is expected to rule by July 1, will not mandate that all local phone companies provide the service, but will require those that do to notify it of their proposed rates, he said.
The District PSC expects to issue proposed rules later this summer, with a ruling on the issue following shortly after that, said Howard Davenport, general counsel for the commission. "A number of parties have asked the commission to go forward with this," he said.
While many would-be operators of the phones are optimistic, the service's attractiveness depends on the rates businesses must pay the phone company. The service may not be the bonanza some thought a year ago.
"New Jersey has taken a rather hard-line approach against competitive pay phone companies," said Philip L. Verveer, a lawyer with Wilkie Farr & Gallagher who represents National Pay Telephone Corp. "The rate levels have been very high and designed to ensure the maintenance of revenue streams" for the phone companies, he said.
While phone companies have complained in the past that pay phones were a money-losing venture, requiring the provision of service in unattractive locations, they may be waking up to the lucrative nature of the service, he said.
"There is no question some phone companies around the country are trying to stifle competition," Verveer said. Pay phones are money losers in areas where phone companies installed too few or too many, he said. "They never thought of them as profit centers.".
Paying 10 cents of every call to the phone company could make the service less attractive, said Michael Gates, executive vice president of Cointel Communications Inc., a California distributor of coin phones. "You've got to operate and make a profit -- with 10 cents off the top . . . you can't make it on that," he said. "If it is supposed to be a competitive industry, then somebody shouldn't dictate what you should charge."
But owning the phone or having another company operate the phones still can be quite lucrative if a firm has enough pay phone business to generate at least $11 a month in commissions from the company it chooses as an alternative to C&P, said George L. Wood, president of U.S. Pay Phone, a Washington-based marketing firm and national marketing director of Capital Tel Systems Inc., a New Jersey manufacturer of coin phones.
Before making a purchase, businessmen should "make sure the phone can handle all the same services the Bell phone is handling right now," he said.
"There will be plenty of business for everybody," said Jerome Lucas, president of TeleStrategies Inc., a McLean consulting firm. The number of installed pay phones nationwide could rise from 2 million to 20 million by the mid-1990s, he said, while the number in the District could increase from about 9,000 to 15,000 by next year.
"With a competitive pay phone you could get into the information service business and can also charge for that information -- like videotex," he said. "Eventually you can get to a point where you can get your airline ticket from the phone. All this will require is the states to open up the opportunity."