LIKE all fond memories, the days of the 087 Premium Rate telephone services feel like yesterday. And yet, scarily, the sensational reign of this money-spinning industry came to an abrupt end almost 30 years ago. CHARL PRETORIUS recalls the period when racing tipsters, and their employers, were coining cash hand over fist.
It is said to have started inside a garage somewhere in England. The world’s greatest businesses seem to start in garages and this would be one of them, if only for a while.
Way back in the late 1980s there was a Pom named Anthony Redfern, and his mate, playing around with racing tips and phone recordings, and selling these recordings to punters on race days.
Technical details are not known, but before long this little business was booming and it is said that Redfern took the idea to a software developer and a media company, who developed Hi-Call Servers – sophisticated equipment that could handle short and long recordings, take a massive amount of incoming calls and provide to-the-minute caller statistics.
The basics were these: Recordings of a certain number of minutes were made, for the purpose of this article they were racing tips, and a preview of any given day’s racing. The recorded messages were from 3-10 minutes in length and the calls were charged at a Premium Rate. Calls to these services would reflect as “Premium Rate” on Service Provider Bills.
The numbers were all allocated as 087 -. Most companies launched everything from horoscopes to dating lines to celebrity chats, and of course racing, the managing of which became a science in itself. The obvious objective was to keep callers on the line as long as possible. Calls were charged at R5,97 per minute, of which Telkom would keep roughly 60% and the rest would go to the Premium Service Provider.
At Times Media, David Mollett, Peter Duffield and Racing Digest were soon on board. The Argus had Robert Garner and co. Alec Hogg, Byron Kennedy and I ran the Racing Digest lines. Alec went through everything from the track condition to the weather before he got to his tips, but they were mostly good, we offered value and struck many outsiders. Byron and I started doing the same. We kept our callers on for five minutes or more, and of course commission cheques went up in size. We’d coin anything from R3,000 to R5,000 a month just in tipping line commissions (big bucks in those days!). Cars, houses were financed!
Hogg commented this morning, in reference to the cheque displayed elsewhere in this article: “Tells quite a story considering we only received a slice of the income generated. It’s a reminder of the need to be patient… you may recall that this 087 boom started just after Caxton acquired Racing Digest. If only we’d known what was over the horizon.
“In theory we had a really good business with “income” exceeding expenses every month, but cash flow was a different issue. Great business lesson though. The books might look great, but it’s the cash flow that really counts!” (We’ll explain this later).
Andrew Bon and I Iater joined Joe Theron and Martin Locke at TIM. An English tipster named “Robbie Goodman” was created, voiced for a while By Steve Masters. Later we launched “Die Ware Wenner” and several competition lines, racing questions voiced, among others, by Greame Hawkins.
The kingpin of Premium Rate tipsters was Robert Bloomberg, who launched “The Ringer” with an operator called Hilly Ehrlich. Bloomberg pocketed in the R50,000 a month range following explicit ads of himself, nude, on his Lotus Esprit Turbo, with just a Compufaform covering his privates. (Small, shrivelled copy of Computaform).
“I had trouble with the Law Society about that advert,” recalls Bloomberg. “They wanted to charge me with bringing the law profession into disrepute!”
At TIM, we expanded to launch Premium Rate Services in Cape Town, partnering with Richard Mitchell and Heletia Oosthuizen at Cape Tab. A team consisting of myself, Bon, Shaheen Shaw, Rouvaun Smit, David Carswell, Terrence Kirchner, Jane Steel and Diana Husselmann manned results and commentary lines exclusively from a massive office in Voortrekker Road, Bellville. The tipping lines also continued to do well.
That was the wonderful year 1992, among other good things conscription came to an end, we were young and the party was on. We thought it would never end.
But it did end, and abruptly too. In November 1992 Telkom announced that it would pull the plug on Premium Rate because, simply, they weren’t getting paid by their customers, so they couldn’t pay their PR service providers.
What had happed was that unscrupulous Nigerians, and others, were renting office space fitted with as many phones as they could get, dialling big-prize competition and other lines to submit mass entries, and then declining to pay their huge Telkom bills. And some other scams. In the end Telkom faced gargantuan losses. On 31 December 1992, at 12am, they cut their connections to all operators.
We were stranded, broken. Soon poor. But hell, what a ride it was!