Business

Premium phone costs 'will fall on bill changes'

Staff at a call centre Image copyright PA
Image caption Premium phone call charges can act as a 'disincentive' to access essential services such as banking

The rules governing premium phone lines will undergo huge changes from the start of July.

The 175 million phone numbers in the UK that begin with 08, 09 or 118 will be affected.

Currently, unless you are calling from a BT landline, it is not possible to work out how much these phone calls can cost.

Premium numbers are often used by customer service and information lines and by directory enquiries.

Disincentive

Consumer groups say that for most callers, the cost of ringing one of these premium phone lines is too confusing.

They claim "NGNs" (non-geographic numbers) can act as a disincentive to individuals who may need to contact an essential service such as their bank or travel provider.

However from 1 July, the cost of an 08, 09 or 118 number will be split into an "access" fee made by the telecoms provider and a second "service" fee made by the organisation being called. "

Image copyright Getty Images
Image caption Some believe business phone lines are coming to an end altogether

All telecoms firms will have to provide the cost of their individual access charge on bills and customers contracts.

This means that consumers using an NGN line will soon be told "Calls will cost x pence per minute, plus your phone company's access charge".

"Experimentation"

EE [Everything Everywhere] which also runs T Mobile and Orange, has recently begun sending texts to customers informing them of its new access charge.

Joe Smithies of Ofcom told Radio 5 Live this new transparency will have the effect of lowering costs.

"All companies have had to come up with an access charge, where they've never had to do that before, they've never had to tell you how much they are taking from the cost of a call, they've never had to standardise it," he said.

"There is some experimentation... but I think what we will see over time is that the market is so competitive in this country that prices will move down".

He adds that more organisations are adopting cheaper 03 prefix numbers, partly through consumer pressure.

"Increasingly banks and government departments are moving to 03 and that's important because 03 numbers cost you no more than the cost of calling someone down the road... so that means there are fewer of these more expensive numbers "

Vulnerable

Telecoms analyst Chris Lewis however is doubtful that consumers will benefit just from changes to the way that bills are presented.

Speaking on Radio 5 Live he said "The customers are, in some cases, very vulnerable... they don't understand what the charges are.

"And the point about varying rates between operators is that you don't have the choice of changing between operators for every call you make."

Figures released so far also show a wide variation between the access charges that telecoms firms will impose.

While EE has put its access charge at 44 pence a minute, Talk Talk says it will charge just 20 pence, while Vodafone will charge 23 pence.

Some telecoms firms are yet to make an announcement.

Shake up

The changes to "Non Geographic Numbers" are part of a wider shake up by the regulator.

From July, calls to 0800, 0808 and 116 numbers, which are currently only free from landlines, should become free on mobile networks too.

Ofcom also plans to cap the highest premium rates charged on 09 numbers, which can cost up to £3 a minute.

However Chris Lewis believes that the days of business phone lines, both premium and standard rate, are undoubtedly coming to an end.

"We are beginning to interact with a lot of these businesses through chat, through email, through Twitter and so on," he said.

"WhatsApp is a good example where actually it's not even using the telephony network to communicate.

"The technology is coming down the line which will allow the call to be set up with no charge to the individual as long as you are online."

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