In a small lot on the outskirts of Salem, Ore., sits a doublewide trailer. Inside are a couple of standard-issue desks, two ancient personal computers, a curiously ornate old filing cabinet, some telephones. Outside are a few parking spaces and a lone gasoline pump.

There is almost nothing to indicate that the trailer is the headquarters of a highly profitable national company. There is absolutely nothing to indicate that the company, Pacific Pride, is such a sophisticated user of information and technology that it has been the subject of four admiring case studies at the Harvard Business School.

The story gets odder still. Pacific Pride has attracted the attention of some of the best business minds in the country even though it is primarily a bill-processor—the blue-collar job of the Information Age. Pacific Pride has achieved the chief information officer's dream even though it spends astonishingly little on technology. It has created an information system that is the core of the business, that runs unmanned, 24 hours a day, seven days a week—and that hasn't had a single crash or error in the past 15 years. Yet Pacific Pride has rejected every technological development since the mid-1980s. Indeed, a core piece of its system is almost a replica of technology that is more than a century old.

Pacific Pride co-founder and President Bruce Douglas smiles and shakes his head at the idea that his technology and ideas about information, developed over years of working in gas stations, have drawn so much notice. "I've presented to second-year students at Harvard a couple of times now," says the 57-year-old Douglas, a gruff bear of a man with a ruddy tan and crew cut. "I permanently warped and twisted 'em. It was fun."

The basic question of the Pacific Pride story is: Why would anyone in his right mind pay an extra 20 cents a gallon for gasoline? Therein lies an Internet-age tale of how information that is valuable to customers can "decommoditize" even the most mundane of businesses. Pacific Pride has thrived by pulling together two insights that, like most good ideas, seem perfectly obvious in retrospect. First, in 1984, when Douglas and his brother-in-law Michael Truax founded the company, they saw that major oil companies focused their card services on retail customers and on long-haul trucking companies. The big companies ignored fleets with heavy regional or local transportation needs, such as those operated by school bus systems, ambulance companies, and state law-enforcement agencies. These fleets had special characteristics: They didn't want employees waiting in retail lines; they needed easy, 24-hour-a-day access to fuel; and their owners refused to pay retail prices. But the fleets generated enough volume that they might be an attractive market.

Second, the technology used to provide service to the fleets was laughable. For decades, fleet operators negotiated a series of arrangements with gas-station owners, who then issued keys that let the fleets' drivers unlock and use special pumps. Each key worked at only one pump, so every driver carried a keychain full of keys for the pumps he frequented. In the middle to late 1970s, it became possible to issue a single card that worked at all the pumps that a fleet arranged to use, but it still wasn't possible to link the information. In other words, each station still sent a bill to each fleet operator each month, and it was nearly impossible for a fleet to track usage by vehicle or driver.

Douglas and Truax decided they could build an inexpensive network that would not just give fleets one-stop shopping at multiple gas stations, but would also give fleets a single bill at the end of the month. More importantly, as it turns out, the Pacific Pride network provided fleets with a by-product: gobs of information about such things as fuel-efficiency and the gasoline used by each driver.

Pacific Pride found that fleet owners valued this information so much that members of its network could actually raise prices. In a cutthroat business where a "jobber"—an independent seller of gasoline—might have a gross margin of two or three cents a gallon, Pacific Pride members' margins may be as high as 20 cents a gallon—an unheard-of premium.

For Pacific Pride, the economics over the past 15 years have been even better. It gets an upfront fee of $8,000 when it signs a member, then receives 20 cents per transaction, plus one-quarter cent per gallon pumped. Fleet owners and members benefit so much from the system that Pacific Pride has expanded to roughly 500 members, with 1,350 fueling locations nationwide, and some 400,000 customers. Its members' Pacific Pride pumps sell more than 100 million gallons of gasoline each month. Yet the company has such low overhead—it has just 30 employees—that it regularly generates net income that is more than one-third of revenue. In 1998, it earned $1.6 million on sales of $4.8 million—making it a niche company, to be sure, but one with margins that other companies would kill for. Not bad for a company peddling an undifferentiated commodity.

Twenty miles north of Pacific Pride's headquarters, too far from I-5 to be convenient for the long-haul truckers, there is a gas station that has its garage boarded up and that appears to be abandoned. The only sign of life is the shiny-clean orange and yellow Pacific Pride logo on a single fuel pump on the side of the building. At three in the afternoon, a police patrol car pulls in. An officer gets out, inserts a plastic card, and begins to fill the car's tank.

Does he mind answering a few questions about the Pacific Pride service?

"Actually, yes," he grunts. "I'm on duty." When his tank is full, he relents enough to give this terse comment: "It works," he says.

Therein lies a key to the success of Pacific Pride's network: It works. Downtime never happens. Every day for 15 years, Pacific Pride's computers have polled all its members' fueling stations, and tabulated them without a single error or minute of downtime. Yet every technology choice the company has made in developing its networked-billing system goes against common wisdom about technology trends.

Begin with the gas card itself, which authorizes the pump to start fueling the vehicle. The card doesn't have a magnetic stripe on the back, as credit cards do. Instead, it's full of holes, like the old keypunch cards used in the '50s. That's exactly what it is: The Pacific Pride card uses the same basic code that inventor Herman Hollerith designed in 1890 as a way to record census data, before he went on to found the company that became the basis for IBM. "I've been carrying this same card for 10 years," says Larry Maher, vice president of information systems at Pacific Pride, pulling the card out of his wallet. "It's never stopped working."

Maher chose to use the Hollerith code because he needed a technology that would work every time, without exception—jobbers and their customers would quickly give up on a system that wasn't available when a customer needed to buy fuel. The cards are virtually indestructible, perfect for the unattended environment where Pacific Pride sites operate.

The downside? The cards hold only 80 bytes—no "giga-" or "mega-" prefix here—of data. That's just the equivalent of 80 characters, not the billions of characters that can be stored on most new PC hard drives. But, when applied with some cleverness, 80 letters turn out to be enough to let each card contain a unique ID for the cardholder, the name of the company that issued the card, and any product and quantity restrictions the customer requested.

When customers refuel at a Pacific Pride site, they insert these crash-tested cards into an ATM-like machine that contains records on all authorized cards, information that is updated by telephone daily. Because each machine has all card authorizations stored on a chip, it can authorize purchases instantly without any sort of network connection. The machines also eliminate the potential problem of lines being down.

Sometime each day, the machine automatically dials into a workstation located in the jobber's main office, which collects data from all the jobber's sites and forwards the data to Pacific Pride headquarters via an autodialer over regular phone lines. The computers make roughly 2,000 long-distance calls a night.

Although futurists say every electrical appliance may soon have an Internet connection, Maher and Pacific Pride have no love of Internet-based solutions. He figures that his customers don't need real-time billing information, because aggregate data are far more important than single purchases. Besides, he says, the Internet isn't reliable enough. The phone calls that are the basis for his system are so short that paying long-distance charges is actually cheaper than signing up for full-time local Internet access. "We've had a couple—and I mean literally two—of our customers say they want Internet access," Maher says.

Maher also decided that older technology is better when it comes to modems. He uses old, 1,200-baud modems because he has found that phone calls using them are shorter than with newer modems that are supposedly as much as 50 times as fast. "Our data calls last less than 30 seconds" with the old modems, Maher says, "and some of these higher-speed modems are so smart that it actually takes longer to [do the electronic handshake that sets up a data communication] than our whole phone call takes."

The workstations given to each member also reflect the company's less-is-better mentality: They are dedicated terminals, usually based on IBM's XT personal computer, a model that is some 15 years old. Maher finally made the tough decision last year to buy some newer PCs—the old ones still worked, but it became too hard to find spare parts for them.

Maher has let his subscriptions to ComputerWorld and Information Week lapse because he found their recommendations just too upgrade-happy for his tastes.

Getting old-line companies like jobbers to change isn't easy, even in the face of the clear economic benefits that can come from better information. Cindy Condon, Pacific Pride's vice president of franchise administration, says jobbers tend to be conservative and mistrustful. As a rule, they are family-owned businesses, with roots going back to the time of John D. Rockefeller. "They are a really tough customer," she says. "These companies are operating exactly the same way as they did 30 years ago, even though the market has changed dramatically."

Condon recalls one jobber who took five years to convince, then recouped his investment within the first six months. "He took me out to dinner," she says. "He told me, 'Cindy, I'm a male chauvinist. I wasn't going to buy anything from a woman.' "

But brutal markets force even recalcitrants to change. Condon recalls walking into the office of a jobber in the early days of Pacific Pride and finding "this guy madly working a 10-key [adding machine]. He looks up and yells at me, 'Do you have any idea what's going on here, what I'm dealing with today? Arco and Exxon are going head to head in a price war, and that means I'm forced to sell at two cents below cost!' I thought to myself, wait a minute, I hate to be stupid about this, but that means he loses more by selling more....Later, I asked Mike Truax to explain. He threw his arm around me and said, 'Cindy, to be in this business, you have to have a hereditary mental defect.' "

These days, talking to a Pacific Pride member is apt to produce happier stories. Dale Cooper, a jobber in Longview, Wash., says that when Condon drove up to meet with him and his father in their small office next to the repair garage, his office parrot was strewing birdseed all over the place and leaving the occasional dropping on Condon's presentation materials. Condon was unruffled. Cooper also says that Condon, who had given birth just weeks before, "came into our office with this screaming baby on her arm." Condon remembers leaving her newborn outside in the car with her mother. In any case, Condon made the sale, and Cooper Oil became a Pacific Pride member that day. Cooper estimates he recouped his member fee within three months. "We started attracting more customers and selling more gallons right away," he says. "The money has been substantial ever since."

Bill Koll, a sales manager with Muzzy Oil in Coeur d'Alene, Idaho, says, "We get the benefit of being on the network. The customers get to purchase fuel at many other sites using the same card, plus they get control over the credit they extend to employees. Everything is handled electronically, so we don't even have to touch it. It's one of those happy situations where everybody wins."

A visit to Pacific Pride leaves one with the uneasy feeling that the frenzied rush of technological progress—at least, all the progress we've assumed is happening, all the upgrades we've purchased, all the hard disk crashes and network freezes that we've come to think are part of life—hasn't always been necessary. Pacific Pride has proved that it's not the technology itself that makes the company a success. It's the information collected and how it's used.

Like its customers, Pacific Pride is tough and conservative, and hell-bent on squeezing every bit of value from the resources it has. When you can do things cheaply, profitably and reliably, who needs to be cutting-edge?

"I'm pretty proud to be running a network that handles a million transactions every month and never loses one," Maher says. "I've been in data processing over 30 years and I realize just how radical a statement that is to make. It's nice, for a change, to be involved with something that just works, and works, and works."

Tristram is a free-lance writer based in San Jose, Calif. She can be reached at claire@tristram.com.