As I strolled through the airport this morning, the story of Esther Strogen, a widow who rented rotary dial phones from AT&T for 42 years, was blaring from television screens.Â At $29.10 per month, the family calculates AT&T has collected over $14,000 in rent.Â
Now managed by Lucent, estimates are that there are as many as 750,000 customers still on rental programs. At $29 per month, that would be aÂ cool $250 millionÂ in revenues annually.Â Â
When questioned, spokesman John SkalkoÂ would only offer “We will continue to lease sets as long as there is demand for them,” and “bills are clearly marked, andÂ customers can quit their lease any time by returning their phones.”Â Skalko also disputes the $14,000 claim, stating that the widow in question has been paying $29.10 per quarter, not per month.Â Since 1985, he claims the total bill has been about $2,000.Â
In any case, Strogen’s daughters terminated the arrangement, whereupon Lucent demanded the return of the phones.Â
It’s enough to make your head spin, isn’t it?
After getting no satisfaction from AT&T, Strogen’s daughters went public:
â€œWe want to bring it to peopleâ€™s attention,â€ Melissa Howell said. â€œMaybe theyâ€™ll look into their bills … Maybe this will make AT&T look into it and stop sitting in an office collecting money.â€
From a public relations perspective, this isÂ a disaster.Â Â It’sÂ a classic example of a “big tobacco company” defense.Â (1) Dispute the facts, followed by (2)Â point out that there were prominently displayed warning labels on the product, then (3) disclaim all responsibility, and (4) pin the blame on the consumer. The problem is that in a world where meme’s spread virally via blogs and the internet, this won’t work anymore.
AT&T could have turned this into a win for Esther Strogen, and kept the story out of the papers very simply.Â They should have:
- Given her the telephones.
- Offered some number of months of unlimited calling in compensation.Â