MONEY COMMENT
Kill (Your Phone) Bill

By Cliff D'Arcy
March 24, 2004

Apologies to Quentin Tarantino fans for mangling the title of his recent film, but the urge was too strong!

Earlier this week, MPs on the House of Commons' Public Accounts Committee (PAC) blasted telecoms regulator Ofcom for failing to encourage effective competition in the home-telephone market. (Note that Ofcom took over from Oftel at the end of last year.)

The PAC's main complaints were:

• BT was privatised twenty years ago, yet still controls around seven-tenths (70%) of the domestic telephone market.
• Ofcom has not done enough to help consumers and has failed to encourage us to switch tariffs or providers.
• The telecoms market is too confusing, which makes it hugely difficult for consumers to compare prices and shop around. Thanks to differences in billing, tariffs and discounts, it is fiendishly difficult for individuals to compare costs.
• Millions of people rent a handset from BT costing around £18 a year, when they could buy one for around £7.
• Up to 3½ million BT customers are missing out on half-price rental because they have not joined its Light User scheme.
• Using BT to make international calls can be twice as expensive as using one of its rivals.

Today, BT responded to this criticism by announcing cuts in its tariffs. It is abolishing its Standard rate and moving these customers onto its Together Option 1 package. This will make BT's prices look better in price comparisons, since many of its rivals compare their tariffs with BT's Standard package. BT has also cut call costs and line-rental charges across all three of its Together tariffs.

Although Standard-rate customers will benefit from lower call charges, they will see their line rental increase by £1 to £10.50 after the switch to Together Option 1. This means that some of the estimated nine million customers currently paying the Standard rate will lose out - mainly light users. Also, customers who rent a BT line but route their calls through another supplier will not be happy!

So, good news for some BT customers – but leaving BT is still the best option for most consumers! The best deal for you will depend on your personal calling pattern, so check out these providers:

BT's Together Options 1,2 and 3 | e-Shop Telecom* | British Gas | International Telecom | Just Dial Saver | One.Tel | Planet Talk | TalkTalk (from Carphone Warehouse) | Telco | Tele2 | Telecom Plus | Tesco | Tiscali | uSwitch*

* Fool Partner

• For cheaper overseas calls, try 18866 (also cheap for calling mobiles), Telediscount and Telestunt.
• For free directory enquiries, visit the BT website.
• To find a cheaper mobile-phone tariff, visit Switch with Which?.
• It can cost up to ten times as much as a standard call to dial 0845 and 0870 numbers, which are used by many big companies. Learn how to beat this rip-off at SayNoTo0870.

Whether you're as quiet as a mouse or a complete chatterbox on the phone, you should be able to save a tidy sum by switching, so make that call today!