Sunday, June 09, 2002

Research needed to find best phone deals

Per-minute rates, monthly fees add up

By Jenny Callison
Enquirer contributor

        If you've spent any time scrutinizing your telephone bill recently, it probably leaves you with as many questions as answers. Unfortunately, unless you have a Ph.D (persistence in hunting down details) degree, you might be paying more than necessary for long distance service, and buying other services you don't need.

        Not only are long distance charges edging up from where they were in 2000, but many telephone companies are finding new ways of charging customers, says Consumer Action, which conducts an annual survey of telephone charges. The nonprofit group's most recent report covers trends in 2001 among 19 different carriers and 44 discount calling plans.

        “The telecommunications industry is so weak that the various players are having to get revenue where they can,” Ken McEldowney, executive director of Consumer Action, said. “Their revenues are dropping 15 to 20 percent a year due to competition from cell phones and the Internet. Hidden charges are higher, and long distance plan charges are creeping up.“

        Consumer Action's 2001 survey compares basic rates charged by the “big three” long distance carriers: AT&T, MCI-WorldCom and Sprint. It says MCI's charges are the most expensive overall, at 30 cents a minute Monday-Friday and 25 cents a minute on weekends. Daytime rates for both AT&T and Sprint are also 30 cents a minute, but weekend rates are cheaper: 16 cents (AT&T) and 10 cents (Sprint).

        Tristate residents who choose Verizon or Cincinnati Bell as a long distance carrier get a better deal on basic long distance: a flat 10-cents-a-minute charge. However, Verizon, like many other carriers, charges more than that for long-distance calls made to numbers within the same state. Cincinnati Bell's aptly-named “Any Distance” plans give the carrier an edge with customers who want low rates for both intrastate and interstate calls.

        Consumers need to understand their own usage patterns and then search for the best deal, Mr. McEldowney said.

        “The important thing is that anyone who is not on a calling plan and makes more than a few long distance calls per month should investigate a plan that's best for them,” he said. “Look at the fine print, and compare it with the fine print of other plans as well.”

        The plan with the lowest rates is not always the best deal if it comes with a monthly fee, Consumer Action's survey report said. Even a small monthly charge could jack up the per-call cost significantly if you don't make many calls. And sometimes there's a minimum: Cincinnati Bell charges a minimum rate of $2.95 for basic long distance. If you use fewer than 30 minutes of time, you'll still be charged $2.95.

        Telephone company Web sites are not only an excellent way to review available plans, they can also offer the best deals. Consumer Action's survey said a comparison of calling plans from the so-called big three shows substantial savings off basic long distance rates for customers who purchase online plans. Telephone customers who don't have access to the Internet at home can do this kind of research at a public library.

        But don't just select a plan and stay with it, Mr. McEldowney warned.

        “You have to keep on top of it,” he said. “Periodically review your plan against others, and assess your current long distance needs.”

        This week, The Fine Print provides consumer caveats about residential long distance service. Future columns will examine hidden costs and user fees for telephone service, and the pros and cons of calling cards.



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