How to Untangle The Long-Distance Phone-Pricing Knots
IF America's long-distance carriers have set out to confuse consumers with their dazzling array of promotions and discounts, then they certainly deserve gold medals.
A basic question such as, ``What is the range of per minute charges on your long-distance calls?'' took AT&T, MCI, and Sprint operators about 10 minutes to answer when queried recently.
The junior player among the big three, Sprint, recently tried to simplify prices by offering dialers just two basic rates - 22 cents per minute during the day and 10 cents per minute for evening use.
Yet, industry observers say competitors intentionally create a fog of special plans and discounts to make comparison shopping confusing. ``There isn't a huge difference. So the companies have to come up with some way to set themselves apart from their competitors, and they try to do it with marketing,'' says Bradley Stillman, legislative counsel at the Consumer Federation of America in Washington.
Adding to the difficulty of choosing a long-distance carrier is the proliferation of new, smaller companies - 444 to be exact, says statistician Katie Rangos, at the Federal Communications Commission (FCC).
Who's the cheapest?
As for who provides the least expensive service, telephone companies and consumer advocates agree that it all depends on where you call, when, and how often a customer dials long distance. That's because some carriers may have lower rates in the early evening, while others may be especially inexpensive for those who make more than $75 worth of long-distance calls a month.
At present - and keep in mind that rates and plans change often - MCI claims that its prices are lower than AT&T and Sprint. For the next six months, those who sign up for its ``New Friends and Family'' plan get one-half off the usual base rates, which translates into an actual tariff of 12 cents to 17 cents a minute during the day; 7 cents to 11.5 cents in the evening; and 6 cents to 8.5 cents at night and on weekends.
Even when a good deal is available, the customer must double- check the numbers; getting them in writing is best.
MCI, which has about 20 percent of US long-distance business, offers domestic base rates just 1/100 of a cent less per minute than the rates of AT&T, which has 60 percent of the commercial long-distance market. Yet, when comparing what residential customers actually pay, MCI's six-month offer is cheaper than its top rivals' offer by a few cents a minute for domestic dialing.
When the special promotions run out, however, it is harder to say which major carrier offers lower rates, industry experts agree. Perks such as airline frequent-flier miles make it difficult to compare offers; last year AT&T added a new twist by offering $50 checks or more to those who would switch services.
Use two carriers
Some of the smaller carriers may offer lower rates depending on time of day or destination, says Barbara Hutchison, executive director of the Tele-Consumer Hotline, a consumer information group in Washington.
She suggests using two long-distance carriers. One carrier to provide regular service and the second that offers a specific bargain and is accessed using a five-digit prefix number.
Yet, in dealing with lesser-known carriers, let the buyer beware. Some will advertise that they are 10 percent cheaper than basic AT&T rates but fail to mention that AT&T offers 20 percent off its rates to customers who spend more than $25 a month.
``They say that they're going to save you so much money, but they're looking at the basic interstate rate not the calling plans that carriers will have,'' says Ms. Rangos at the FCC.
One resource for consumers choosing a long-distance service is the Telecommunications Research and Action Center (TRAC), P.O. Box 12038, Washington DC 20005. The center will send out a useful comparison of long-distance rates and plans for $2 dollars if you include a self-addressed stamped envelope.