Hold the phone!
About 500 companies now push long-distance calling plans. You need to be ready to fight - or switch - for better rates. Here's how.
Fierce competition, deregulation, and technological advances are reconfiguring the telecommunications industry, driving down long-distance phone rates and giving consumers a seemingly limitless - if sometimes baffling - array of service options, from Internet telephony to "dial around" numbers like 10-10-220.
How do you find the plan that's best for you?
These days some 500 companies sell long-distance service. Each tries to hook customers with promises of low per-minute fees. But those savings are often offset by costly line charges and surcharges that consumers often overlook.
"The question is not what the per-minute rate is, but what is the total bill," says author and telecommunications expert Dr. Robert Self. "It's far more important to be on the right plan than to be on the right carrier."
The key to finding the right plan is knowing your own calling patterns. How large is your monthly bill? How long do your calls tend to be? What time of day? Where do you call?
Remember: Your calling patterns may change as frequently as service packages. Those who talk the least can sometimes pay the most, thanks to high monthly fees.
Once you determine your own patterns, shop around. Carriers are constantly changing their offerings. And as consumers prove willing to switch carriers to land better deals, companies may prove just as willing to modify their rates to retain them.
If you find a competitor's plan that better matches your calling patterns, ask your carrier to match it. If it refuses, don't be afraid to switch.
True, sifting through the details of pricing plans to find the best deal can be a grueling process. And savings between carriers can be tiny. That's why most callers stick with major carriers like Sprint, MCI, and AT&T.
But help has arrived: the Internet. On one hand, Web-based companies such as Net2Phone (www.net2phone) and Dialpad (www.dialpad.com) have come on-line, offering cheap long-distance services, either via regular phones or computers, directly over the Internet.
Upside: Rates can hover as low as 1 cent per minute. Downside: Quality of service is often substandard.
The Internet's real edge may be Web sites that compare pricing plans. The Telecommunications Research & Action Center (www.trac.org), for example, compares the plans of seven carriers and offers great tips for keeping your bill in check. Other comparison sites include A Bell Tolls (www.abelltolls.com), Cognigen (www.cognigen.com) and Phone Rate Finder (www.phoneratefinder.com).
While comparing features and functionality, consumers should pay particular attention to calling cards. Many carriers offer super-low rates for calls made from home, but charge exorbitant amounts for calls made away from home using their card. Many, if not most, rate-comparison Web sites offer sections on calling cards.
Another way to unintentionally inflate your bill to whopping proportions is directory assistance. In 1998, Ameri- cans spent more than $5 billion finding phone numbers. Again, the Internet can help. Web sites like www.whowhere.com, www.555-1212.com, or www.anywho.com should be your first stop before calling the operator. Portable, Web-ready devices are making it possible to do this even from road-side phone booths.
As broadband transmission capabilities grow, long-distance companies will likely offer blocks of chat time for one low, flat rate. The three "one-plus" long distance carriers - AT&T, MCI, and Sprint - have begun experimenting with the model in certain parts of the US.
Callers may also see local charges and long-distance charges merged.
"Voice services will likely follow the Internet model," says Blaik Kirby, a vice president of Renaissance Strategy, a information-technology consultancy. "You really get global and local service for the same price with Net connectivity. Once you've paid for access, it costs the same to send a message to your neighbor or to someone in another country."
"Dial around" numbers have become increasingly popular over the years. By dialing a series of numbers, beginning with 101 or 10-10, callers can access a long-distance carrier other than their own for cheaper rates.
But be warned: While rates per-minute are attractive, there are usually minimum talk-time restrictions and other hidden charges lurking about.
Expect companies to "bundle" services such as image, two-way voice, and data transmission into one package. So instead of having separate providers for your cellphone, Internet access, and long-distance, consumers will have only one provider and one monthly bill.
Some experts say that while bundling will simplify the billing process, it may make comparison shopping for services more difficult.
"When you start bundling it's possible to hoodwink the customer more," says Dr. Self. "If I don't see specific separate prices for each item such as local, long-distance, cell, paging, and Net access, then I can't know if the prices I'm getting are competitive. These companies clearly don't want to make price comparisons as easy as they could."
(c) Copyright 2000. The Christian Science Publishing Society