Simplified call charges to help consumers
04 April 2012
Calls to 0800 telephone numbers could be free from all phones, including mobiles, under new proposals published today by Ofcom.
This major step is part of detailed plans to tackle consumer confusion about how much it costs to call businesses, public services and other organisations on 03, 08, 09 and 118 numbers.
Currently, the vast majority of 0800 phone numbers incur a charge for mobile callers of up to 21p a minute. Under today's proposals, calls to 0800 numbers from a mobile would be free for consumers, in line with landlines.
Under the new proposals, Ofcom also proposes to clarify and simplify how calls to 08, 09 and 118 numbers are charged for. Services provided on these numbers include information, banking, directory enquiry and entertainment services.
Currently, unless they are using a BT line, callers are unable to tell how much they will be charged for such calls. In addition, callers are not able to understand how much the call costs as opposed to the cost of the service being provided via the call. Under Ofcom's proposals, consumers will in future be presented with clear, transparent information on both.
The change to freephone, plus the other proposed changes, would create a new, simpler system for call charges - helping consumers regain trust in these numbers. Ofcom's proposals follow new powers introduced in changes to the Communications Act in May 2011, as a result of revised European telecoms legislation.
Virtually every consumer and company in the country uses non-geographic numbers in some way. People use them to call businesses and government agencies like HM Revenue and Customs and NHS Direct, make payments for services and vote on TV shows.
However, Ofcom research has shown many people are confused about what non-geographic numbers are for and how much they cost, resulting in a lack of confidence and trust in the services.
As a result consumers make fewer calls to these numbers, providers are discouraged from using them and there is less innovation that might benefit consumers.
Ofcom is proposing simpler numbering ranges for non-geographic calls, including:
- Freephone (080 and 116 numbers) to be free from all telephones - including landlines and mobile phones; and
- Revenue sharing ranges (08, 09 and 118 numbers) to have a new, standardised structure which will spell out the charge made by the phone company and the additional charges paid to the company being called.
- We also will remove some of the existing confusion around the 0845/0870 numbers and reinforce the 03 range where the cost of calls are the same price as calling a geographic number (i.e. numbers staring in 01 or 02).
Revenue sharing numbers
When a consumer phones a revenue sharing number, the price paid is divided between the phone company, who connect the call, and the call service, who receive the call.
Under the new proposals, the call cost will be 'unbundled' so that consumers will know exactly how much is paid to their phone provider and how much is passed on to other companies. The cost would therefore be made up of two parts:
- an Access Charge - a set price, in pence per minute, which goes to the phone company connecting the call (this will be set out in the consumer's tariff package); and
- a Service Charge - the price, in pence per minute, paid to the terminating provider and the company providing the service.
This will provide a clear unambiguous message to consumers.
Currently, callers are told: "This call will cost you X pence per minute on a BT line, calls may vary on other landline and cost considerably more on a mobile."
Under the new structure, Ofcom expects call cost descriptions to follow the format: "This call will cost you X pence per minute plus your phone company's access charge."
Consumers would be advised of their Access Charge at the point of sale when buying any new phone service. Subject to the results of the consultation, Ofcom intends to make a final decision on the new rules by early 2013.
Ed Richards, Chief Executive of Ofcom, said:
"Consumers are often confused about how much they will pay to call these number ranges. Under our proposals, people will have much clearer information and there will be greater competition on prices.
"By making calls to 0800 numbers free from all phones, we will clear up any uncertainty about making calls, especially from mobiles, to the benefit of consumers and service providers alike."
NOTES FOR EDITORS
1. Advice for consumers on call costs can be found at: http://consumers.ofcom.org.uk/2009/10/how-much-does-a-phone-call-really-cost/
2. Under section 3 of the Communications Act 2003, Ofcom is required to further the interests of citizens, in relation to communications matters, and further the interests of consumers in relevant markets, where appropriate by promoting competition.
3. The consultation on Simplifying Non-geographic Numbers can be found at: http://stakeholders.ofcom.org.uk/consultations/simplifying-non-geographic-no/
4. Ofcom published research on non-geographic telephone numbers in November 2011. It can be found at: http://stakeholders.ofcom.org.uk/binaries/research/telecoms-research/omnibus-survey.pdf