Is it good to talk? Line rental prices keep rising

The days of BT supplying devices free of charge etc were not good. These low charges for hardware etc were offset by extortionate charges for calls, even basic local and national calls. Charges for international calls in the 1980s and early 1990s would breach the current roaming price caps, even without adjusting for inflation. The whole thing was a total rip-off where charges bore little connection to cost.

As far as I am aware they are not in breach of contract as they do state before you sign up that prices can go up during the term of your contract that’s what they did with me before I signed my contract that response is to the person with talktalk

Fibre broadband is simply not an option for many of us at present, and it could be years before we are all connected. I had a 90 minute power cut recently and my mobile was dead. I have one wired landline phone, so I spent the time phoning friends.

My point is that fibre broadband should be an option for most people; I’m well aware that it isn’t currently. Copper telephone lines have had their day and should be confined to history as soon as possible.

As I see it, we are moving towards fibre broadband at a reasonable rate and to roll it out faster would mean a substantial increase in what we are expected to pay.

I have several friends who have never seen a download speed of 1Mbps. Might it be fairer to prioritise areas with a very poor service rather than replacing copper wiring in areas with a 5 – 10Mbps service, which many users find satisfactory?

I agree that priority for a blanket fibre rollout (e.g. by BT Openreach) should be given to rural areas where the improvement in speed will be greatest. Urban areas already benefit from a competitive market where niche providers like Hyperoptic are already providing fibre broadband without using BT Openreach’s infrastructure.

One of the reasons that I am very keen to keep my landline is that it is usually expensive to call a mobile from landlines. NFH has thought about this, by setting up a virtual 020 number, but I wonder if some mobile users realise how much it can cost to call them. I have often wondered whether it is the landline or mobile provider that makes money out of these costly calls.

@wavechange – I think the answer to your question is that it’s the landline providers who make the bulk of the excessive profit from calls from landlines to mobiles. I draw this conclusion because:

1. Using FreeVoipDeal.com, I can call UK mobile numbers for €0.007 (0.5p) per minute. The termination rate payable to the mobile networks must be even lower than this retail price.

2. Consider the prices charged by the mobile networks themselves for bundles of calls for mobile-to-mobile. They are similarly a fraction of the price charged by landline providers for calls to mobile numbers.

Thanks NFH. This seems a reasonable assumption.

Termination rates for calls to 01 and 02 landline numbers are around 0.21p per minute.

More than a decade ago, termination rates for calls to mobile numbers were at least 20p per minute. Since then, they have been steadily falling. Ofcom intervened in the market a few years ago and forced an accelerated reduction. Termination rates for calls to mobile numbers are now around 0.85p per minute and will be subject to a further small reduction in April 2015.

Termination rates for calls to 01 and 02 landline numbers are around 0.21p per minute. – Thanks Ian. What are the termination rates for calls to 03 numbers? I believe they are higher. In July 2014, FreeVoipDeal stopped charging 03 numbers like 01 and 02 numbers and started surcharging them at €0.03/min. FreeVoipDeal are based in Luxembourg so don’t seem to respect Ofcom’s rules about 03 numbers be charged at the same rate as 01 and 02 numbers.

Termination rates for 03 numbers appear to be around 0.56p per minute on weekday daytimes, and around 0.26p per minute during weekday evenings and at all times during weekends.

The difference between the termination rates for 03 numbers and those for geographic 01 and 02 numbers is at least partly due to the fact that calls to geographic numbers have far-end handover and calls to non-geographic numbers generally have near-end handover.

Thanks for that Ian. If the cost to an operator of delivering an 03 call can be double that of an 01/02 call, how can operators be expected to charge 03 calls at the same rate as 01/02 calls? I’m therefore not surprised that non-UK operators ignore Ofcom’s guidance. This needs reform, otherwise 03 will become another 0845, particularly as more consumers buy their telecoms services from other EU countries.

The termination rate for calls to 03 numbers may be higher but the near-end handover means the transit costs for the originator are lower. Likewise, the termination rate for calls to 01 and 02 numbers may be lower but the far-end handover means the transit costs for the originator are higher. In the end, there’s probably not all that much difference in the overall costs of call origination for each.

The termination rate for calls to mobile numbers is four times that of calls to geographic numbers and yet mobile operators manage to offer large call allowances, even unlimited calls, to both landline and mobile numbers.

The ongoing scandal is that landline operators still massively overcharge for calls to mobile numbers. For example, Virgin Media still charge up to 31p per minute. BT’s best rate (on Home Phone Saver) is still as much as 6p per minute.

With the termination rate for calls to mobile numbers now around 0.84p per minute, landline operators should be able offer a reasonable number of inclusive calls to mobile numbers in their monthly call allowances. The next reduction in the mobile termination rate is scheduled for April 2015 and should bring that reality much closer.

Thanks again Ian for this useful answer. How do termination rates for 03 numbers compare with those for 0845 numbers?

I agree totally with your comments about the lack of correlation between retail charges and termination rates for calls to mobile numbers. It’s similar with international calls in that charges are based according to what operators believe the general public perceive to be normal rather than being correlated to cost.

Alongside the inflated cost of calling mobile numbers from landlines, nowhere is retail price manipulation more obvious than in the illogical inclusion of calls to 0845 numbers within some of the call packages offered by several landline providers. The Enhanced Termination Rate for calls to 0845 numbers is currently around 1.6p per minute – almost double the Mobile Termination Rate.

The cost of telecoms has plummeted in the last decade. We no longer pay for individual calls to 01, 02 and 03 numbers. Most people call these within the allowances of an inclusive call package on their landline or on their mobile. By now, the same should also apply to calls to mobile numbers from landines.

The “unbundled tariff” will reveal the realities of 084, 087, 09 and 118 call pricing. With the Service Charge exposed and separately declared for what it is, this new found transparency should bring an end to inclusive 0845 and 0870 calls – especially as the Service Charge for 084 numbers will be allowed to be as much as 7p per minute including VAT.

This, coupled with the forthcoming small reduction in MTR should be the moment that inclusive calls to mobile numbers from landlines finally becomes a reality.

Re: “This … should be the moment that inclusive calls to mobile numbers from landlines finally becomes a reality.”

TalkTalk now offers unlimited calls to both landline and mobile numbers on their “anytime” call plan.

If Sky and one or two others do the same, the rest will surely follow.

In April 2015 there will be another small reduction in the Mobile Termination Rate.

June 2015 presents an obvious opportunity to stop offering inclusive calls to 0845 and 0870 numbers, and replace these with inclusive calls to mobile numbers.

0845 numbers are inclusive calls on many networks. Why wouldn’t they be? When will other networks start including them?

Following years of complaints about the high cost of calling customer service lines on 0870 and other non-geographic numbers, Ofcom suspended revenue sharing on 0870 numbers on 1 August 2009. Most landline providers, including BT, made these calls inclusive in their call plans. However, consumers gained nothing because most users of 0870 numbers simply swapped to new 0844 or 0871 numbers in order to continue receiving revenue share payments. Additionally, most mobile providers did not drop their 0870 call prices.

At the same time, BT incorrectly anticipated that Ofcom was about to suspend revenue sharing on 0845 numbers. BT therefore decided to also make 0845 calls inclusive in their call plans. Calls to all 084, most 087 (not 0870 at present) and all 09 numbers incur a Service Charge paid to the joint benefit of the called party and their telecoms provider. Where 0845 calls are made inclusive, all call plan subscribers are contributing to those payments whether they call these numbers or not.

Ofcom quickly realised that the changes to 0870 numbers had been a failure and did not proceed with any changes to 0845 numbers. This left BT with a problem. They now had to pay out Service Charge without collecting revenue for each call, a situation that still prevails more than five years later.

On 26 June 2015, 0870 calls will once again return to revenue sharing and all users of 084, 087 and 09 numbers will be required to declare their Service Charge wherever their number is advertised. This will confirm all 084, 087 and 09 numbers as being expensive and will be an ideal time for BT and other providers to stop offering inclusive calls to 0845 and 0870 numbers.

Those users who are unable to justify the imposition of a Service Charge on callers should change their number to one which does not impose it. For those who need just such a non-geographic number, Ofcom made replacement 03 numbers available in 2007. These are inclusive calls from landlines and from mobiles. Take up of these numbers has been slow until the last couple of years.

Recent regulation covers post sales lines for retailers, traders and passenger transport companies and requires them to use 01, 02, 03 or 080 numbers in place of 084, 087 and 09 numbers. Cabinet Office guidance mandates similar terms for government departments and agencies. The FCA will, very belatedly, eventually introduce similar regulation for the financial sector.

Thus, all these changes will largely return 084 and 087 numbers to usage only by those offering a genuine chargeable service. It is only right and proper that only those people who call these numbers should be paying those Service Charges, therefore these calls should not be inclusive in call plans.

Simon – do you also believe that networks should include calls to 09 numbers in inclusive minutes? I don’t understand the basis on which you believe that a surcharge can be included within inclusive minutes without making a loss for the network or without the majority of customers unreasonably footing the bill for the minority. There is no economic difference between including 09 numbers and including 0845 numbers except that the magnitude is different.

I have made plenty of use of calls to 0845 and 0870 numbers, and I chose my phone tariff because these calls are included, as are weekend and evening calls to mobile numbers. It’s a case of choosing the tariff that best suits your needs.

With most retailers, traders, passenger transport companies, government departments and agencies, banks and insurance companies now abandoning 0845 and 0870 numbers en masse, you’ll soon have no need to phone these numbers.

When inclusive calls from landlines to 0845 and 0870 numbers are dropped, you’ll not miss them. Calls to the replacement 0345 and 0370 numbers have been inclusive both from landlines and from mobiles since 2007.

Thanks wavechange, I always try & look at prices over the 12months & not just monthly.

And as for the complaint i always try & follow the same system (as you can see from my comment).

First I mention the company in a tweet (I never tweet the company direct as only you & the company see it, it’s better to send an open tweet so as many people see it as possible). I also like to include Which in the tweet: https://twitter.com/WhichConvo

Then depending on what reply I get, I follow it up with a e-mail to the complaints team like i did today (and copying the tweet into the e-mail so the company knows I moan on social media). Or sometimes the company will contact me first following the complaint tweet.

To update this, I have this morning had a email from “Hugh Stacey – Senior Telephony Marketing Manager”, just proves my point – when you moan on Twitter the top people contract you.

While I still don’t have the outcome I would like (A £39 goodwill credit to cover the increase) I do believe things are moving in the right direction.

Well done Lee. What my service provider’s £1 per month price increase achieved was to encourage me to look at my present tariff, switch to a cheaper one that is more suited to my current requirements and cancel paper billing. I’m now saving around £5 per month.

I’ve just done the same thing. I’ve emailed them to ask them to justify it. Nearly a 50% increase in 12 months. It’s daylight robbery.

The “lines” which we “rent” have been paid for decades ago when installed. Yet we still pay for them on a “monthly” basis…month by month… year by year….FOREVER! The actual piece of fibre optic line costs LESS than that. The govt should step in on this ENDLESS scam by BT (and the rebranded 3rd party companies) and end this RENTAL scam.

The maintenance and renewals of the telephone lines and all the technical equipment in the exchanges still has to be paid for.

The sneaky thing about line rentals is that, during the early days of British Telecom – after it separated from the Post Office – the tariffs were changed from quarterly billing to monthly billing and this has enabled the rates to rise less noticeably but more expensively for many years now.

The monthly billing is the choice of many BT subscribers you need to apply to get it John .I have been on quarterly bill since I first got a landline phone in (donkey,s years ago ) and I am still on quarterly payments and yes it is DD . But yes BT has just increased all tariffs recently but it is across the board.

Agreed Duncan, but my point was that the translation to monthly billing meant that price rises did not appear to be so significant. A one pound rise on a monthly bill does not look so bad as a three pound rise on a quarterly one so is easier for BT to get away with. I have no complaints about monthly billing as a payment mechanism but I confess I never bother to check my bills when they come in attached to an e-mail. Paperless billing has also allowed tariff increases to go through with little attention to them.