Strategic review of telecoms - consultation response.

To:  Dougal Scott   
 
Ofcom            Riverside House
2a Southwark Bridge Road          London SE1 9HA.         Fax: 020 7981 3333


Competition in the telecoms industry appears to be working and gradually driving down prices in a number of areas, with on exception.  Of particular concerned is the increasing use and pricing of non-geographical telephone numbers.  A trend that is driving up prices to the consumer..

Companies using 0870 numbers will, after 1 July 2004, be making their customers pay 4.5p per minute extra for daytime calls, as 0870 call cost 7.5p and the maximum cost of all geographical UK calls is 3p.  This is 150% over and above geographical telephone numbers making them true premium numbers.   The 4.5p extra charge is shared between the telephone operator and the company.  The companies share depends on the deal they have, but as far as the customer is concerned the calls cost them 4.5p per minute more than it should.

According to Ofcoms own research, a significant number of callers are not aware of the charges associated with 0870 numbers, those numbers should be advertised as premium numbers, together with a clear statement that they incur an extra cost of at least 150% above a normal geographical numbers.   A better solution would be to replace all 0870 numbers with 09 numbers, the numbers range designated as premium.

Enticed by extra income, companies are increasingly using 0870 for their normal communications. Even some Government agencies which have a monopoly on their services, and are often dealing with vulnerable sections of the community, are joining the bandwagon.

As the distinction between national and local calls is to be abolished on 1st July 04, there is now no justification for any organisation to use 0845 numbers, which never cost less than any geographical number, regardless of location.   There is no reason why 0845 numbers should not be included in BTs Option 3 and other similar packages.
 
The increasing millions of customer who pay extra for  BTs Option 3 and other all-in schemes, who normally pay nothing for geographical calls, pay the full cost of calls to 0870 and 0845 numbers,  7.5p and 3p per minute.  Those customers are, in effect, forced to pay twice.  This goes against the general trend for price reductions.  It is invidious that at a time when BT is encouraging customers to use all-in pricing options, they are, at the same time, encouraging companies to use profit sharing non-geographical numbers, which are excluded from Option 3 and generate more money.

Taxpayers pay for Ofcom to regulate the telephone service, but their statements and replies to letters, appear to justify the position of the telephone suppliers, on present performance, Ofcom could not be described as robust defenders of consumer interests. Ofcoms statements and consultation papers are prolix, convoluted and unnecessarily complex.

Kevin  Kearney,   KBKearneyXXX@hotmail.com