Privacy Not an Issue, Company President Says : Firm Finds Niche With System to Track Calls

EAST ROCHESTER, N.Y. — When it comes to keeping tabs on personal calls made from the office, Albert Montevecchio has no problem with the privacy issue.

“When it’s my money you’re spending, I have every right in the world to know how you’re spending it,” said the founder and president of Moscom Inc., the world’s leading supplier of call-accounting computer systems.

If someone is calling a friend who works across town five times a day or making long-distance calls to relatives, the company will be able to find out. The systems won’t let anyone listen in on calls.

“All it does is tell the boss who you called, how long you spoke and how much it cost, which seems like it’s fair information,” said Rob Boxer, the company’s corporate counsel.

“One guy we sold a system to said, ‘You know, before I bought your product every time I looked at a phone on someone’s desk it looked like a blank check,’ ” said Boxer.

The systems consist of software for personal computers and a cable connecting the PC to the phone system. An older, less flexible version uses a printer instead of a personal computer.

Many companies that install the systems don’t use them to check up on employees, and others may only track calls that exceed $10, Boxer said, but he acknowledged that the potential for “going overboard” does exist.

That’s exactly what most workers fear, according to Elaine Eisenman, an industrial psychologist and a consultant for the Chicago management consulting firm of Rohrer, Hibler & Replogle.

“What it really comes down to is what is the definition of personal privacy in the workplace and can there be any,” she said. “How many rights are you expected to give up when you show up for work?”

Comprehensive Phone Bill

The answer is pretty simple for Montevecchio, who believes too much fuss is being made about employee privacy.

“We use it here and we don’t have people revolting,” he said.

The real appeal of a call accounting system is that it gives executives a comprehensive look at their telephone bill, which in some companies could be $300,000 a month, Montevecchio said.

Are workers using ordinary phone lines instead of low-cost WATS lines? Are there a number of charges for hang-ups indicating bad connections? Should more trunk lines be added to avoid repeated busy signals?

“When deregulation hit, it forced a lot of major corporations and even medium-sized companies to become their own telephone company,” Montevecchio said. “This is the biggest non-controlled expense they have and they’re crying for tools to help them manage their telecommunications.”

Last year, Moscom sold more than 5,000 call accounting systems in this country and in Europe, mostly as a supplier to big names in the telephone industry like American Telephone & Telegraph Co. and Siemens AG of West Germany.

Moscom estimates about 15,000 of its call accounting systems are in use around the world. The ones for PCs cost $1,300 to $4,500, depending on the number of phone lines covered. The older versions are $2,500 to $7,500.

The 5-year-old telecommunications company, based in East Rochester, has enjoyed two years of growing sales and profits after nearly being forced out of business by a sudden development in the rapidly changing telephone industry.

Everything looked rosy when Moscom successfully courted AT&T; as a customer and was shipping hundreds of call accounting systems a month to the telephone giant.

But then, in 1985, Moscom learned that AT&T; planned to offer a line of personal computers and hoped to sell software for them that would perform an array of services, including call accounting.

Moscom had no computer software that would do call accounting. All it had was the computerized hardware unit.

“We saw the handwriting on the wall,” said Boxer.

In a wildly frantic six months, while sales were dropping by nearly 50%, the company and a consulting firm came up with a computer software product that could run on virtually any personal computer.

“There were a lot of times when all of us had doubts whether we were going to be able to make it or not,” said Montevecchio. “Because going from where we were to where we had to be was a chore that a lot of us didn’t relish, but we had to do it.”

Today, 60% of the company’s sales are in computer software and growing. Most of the hardware sales are made in Europe, said Boxer, where the company’s initial products are still popular.

Moscom, which lost $7 million in its first four years of business, finally turned a profit of nearly $1 million in 1987.

Business continues to improve. In its most recent fiscal quarter, which ended June 30, the company’s profit was up 171% at $480,000 on sales of $2.5 million. The over-the-counter stock is up to $3 or $4 a share from $1.8750 at the end of 1987.

This year the company has also started to market its first product using the Moscom name. The Moscom “MaxNet” not only does call accounting but also keeps track of billing and out-of-service alarms and provides directory assistance.