Beeper Business Was Call to Glory for Fed-Up Owner of Pizza Business

Eight years ago, Norman Minkow owned a Canoga Park pizza parlor at Roscoe Boulevard and DeSoto Avenue. He was bored stiff.

“After being in the restaurant business for a few months it lost its glitter,” Minkow said. “Making pizza was not that big of a challenge.”

Minkow was so bored that he bought a personal pager, or beeper, which enabled him to stay out of the kitchen and away from the restaurant. His employees simply dialed his beeper number whenever there was a culinary catastrophe and Minkow would call in to find out what was wrong.

“Sometimes when it was slow, I would just go out to the beach,” Minkow said. “Usually they were calling because the carbonator did not work or the dough machine had broken.”

Beepers were still a relative novelty in 1980, but Minkow correctly sensed that this would change. Besides their growth potential, beepers held another attraction for Minkow--they were a lot more interesting than pizzas.

Owns Transmitters

Today, Minkow, 49, is the president and sole owner of AllCity Paging, one of the larger of the 91 beeper companies in California. His Tarzana company sells air time for more than 12,000 pagers and now has its own transmitters, which enable his customers to stay in touch from Santa Barbara to San Diego. Revenue last year was about $5 million and Minkow claims the company is profitable. Minkow said AllCity is growing by 20% a year.

It’s a tough, competitive business. The industry in California is dominated by telephone company subsidiaries including those owned by Southwestern Bell, Pacific Bell and Bell South. All have recently been acquiring smaller firms like AllCity to boost their market share.

AllCity has survived by charging less. The company charges $11 a month for basic service. By comparison, GTEL charges $12 a month to serve the same area as AllCity, according to Tom Leweck, spokesman for GTEL’s parent corporation, GTE California.

“They have a reputation for being a company that goes out and undercuts everybody’s pricing,” said one of AllCity’s competitors.

During the 1980s, as prices dropped, beepers along with other instant communication devices such as fax machines and cellular telephones have grown in popularity.

In 1976 there were just 424,000 pagers in use in the country. Today there are 7 million pagers, about 500,000 of those in California. The state Public Utilities Commission estimates that the beeper industry is growing at approximately 15% annually in California. The Cambridge, Mass.-based consulting firm of Arthur D. Little estimates that 10 million pagers will be in use by 1990. “There is no escaping beepers,” Minkow said.

Minkow got in on the crest of the pager boom in 1980 by investing $500 to buy some pagers and agreed to buy air time on a Burbank beeper company that had a transmitting station. The beeper company didn’t bill Minkow for 30 days. In the meantime, he started renting pagers and selling air time to beer vendors and pizza dough salesmen who were visiting his shop.

The beepers are made by Motorola or other manufacturers, but Minkow’s company either sells or rents them. The beeper technology is more primitive than cellular phones--after all, it is essentially a one-way communication device--but beepers have advantages over cellular phones.

Cheaper Than Cellular

For one thing, beepers are cheaper. Beepers cost about $200 to buy; Minkow rents them for a maximum of $14.50 a month. A cellular phone, by comparison, costs from $200 to $500 and the average monthly phone bill in California is about $150 a month. With a beeper, however, the caller pays for the phone call, the beeper customer does not.

AllCity’s customers range from corporate giants such as Mobil Oil to San Fernando Valley housewives. “Our customer base is really from the Fortune 100 down to you and I, just the average person,” Minkow said.

The technology has advanced too. There are pagers that vibrate rather than beep, pagers that display the telephone number of the party calling as well as a code that indicates how urgent the call is, and pagers that are connected with voice mail systems that allow users to hear entire messages.

Minkow got his start in business working for Sears Roebuck as a management trainee when he was just 16. After 8 years at Sears he became an insurance salesmen, then his career detoured again when one of his policyholders sold him an ice cream shop in Westwood. Two and a half years later he sold that and bought his pizza shop in 1972 for $65,000.

To get started in the beeper business, he bought some radio frequency space from Interstate Radio and Telephone in Burbank. “I bought the air time at a reduced price,” Minkow recalled. “I in turn marked it up and sold it.”

Sold Pizzeria

After selling time to his pizza suppliers, he expanded by calling businesses in the Yellow Pages. By 1982 AllCity was comfortably profitable and Minkow sold his pizza shop.

Last year AllCity stopped buying air time from Interstate and built its own $1-million transmitting systems with a main tower atop Mt. Wilson. With the many relay stations, it can accommodate up to 50,000 pagers. “We have to be totally integrated so we can do our own thing,” Minkow said. “Be the master of our own destiny.”

To keep growing, Minkow recently got approval from the Federal Communications Commission to expand beyond California. The company intends to provide paging service in several cities in the Western United States including Denver, Houston, Dallas and Seattle.