After MCI, FTD, Airfone, and Inflight Phone, does Jack Goeken have yet another successful start-up in him?
Thirty years ago, John "Jack" Goeken strung a few radio transmitters on a St. Louis-to-Chicago truck route, founded MCI Communications Corp., and eventually toppled the Bell System. Later, he combined computers and flowers (Floral Network Inc. (FTD)) and phones and airplanes (GTE Airfone Inc.). His latest venture, In-Flight Phone Corp., uses all-digital cellular radio, video screens, and under-the-seat 386 PCs to bring noise-free communications and information and entertainment services to the skies. Now Goeken, 63, is plotting one more grand battle: He plans to take on the phone companies in the local service game. "One thing I don't want to do is sit in a rocking chair," he says.
Wired: The story of how you beat AT&T is a classic David and Goliath story.
Goeken:
Myself and some other fellows were selling two-way radio systems. We put in an application for the microwave license from Chicago to St. Louis. The only purpose was to allow truckers to put their two-way radio systems on our towers and use the microwave towers to bring the signal back to Chicago or St. Louis. We never figured on making any money on this. We just felt we'd sell more radios and get some maintenance contracts. But AT&T (and other telephone companies) all filed a petition to deny our application. To show you how smart we were, we knew it was going to take some big money to fight these companies, so each of us put in $600 for a total of $3,000. The rest is history. What's great is that it shows that five people with a belief and a willingness to stick to it and $3,000 can go in there and fight the world's largest company and change an industry.
Is it still possible for one person with an idea to take on today's communications conglomerates like Bell Atlantic and TCI?
The advantage an individual has over a big company is dedication, fighting for something he believes in. An entrepreneur is a person who doesn't understand what an obstacle is. Lots of times people are afraid to make a move. To me, it's not how many failures you have, it's getting that one success that pays off. You take an individual - he's going to put the effort in to come up with a better product and give better service to the customer. Today, MCI is more structured than AT&T probably ever was. But that's the way life goes. With MCI falling into the same mold, it opens the door for some new people to come in and make some inroads.
But the playing field in communications today seems tilted toward big companies. For instance, the government is auctioning off PCS spectrum - basically starting a new industry - only to companies that have the big bucks.
With MCI, there was no way we could have bid in an auction. But we came in with lots of innovation. If you have to go out and buy spectrum, the financial people run the company from the start. And the entrepreneur with a good idea gets shut out.
Can large companies drive innovation?
Large companies don't take risks. So there are lots of opportunities out there. That's why when we get In-Flight up and operating and profitable, hopefully later this year, I'd like to go into the local distribution business, compete with the local telephone companies. I think that's a tremendous market. That would be like a complete circle: Start out with competition in long-distance and end your life with competition for local phone companies.
There are a lot of companies preparing to take on the Bells (including, now, MCI). What will you do differently?
I'm not going to give away my ideas, but what we'll do is be better at a lower cost. I'll keep my mind open, see who's out there and what's being offered. We'll look at using a mixture of transmission technologies. No one technology fits every application: fiber optics, coaxial cable, spread spectrum, gigahertz microwave radio, infrared. What we'd do is form a company with a nucleus of experts from various aspects of communications. We've been talking to people enough to know there's an interest. Nobody's come up with my approach so far. We would operate locally, on a nationwide basis. We'd be putting all new equipment in place. We're looking at maybe $200, $250 per subscriber. (Typical network costs today are $1,000-plus per customer.)
