TRACNotes
Vol. 3 # 43 --
October 28, 2005
 |
 |
BECOME A TRAC MEMBER
By joining TRAC, you will be joining thousands of consumers who want to learn and be involved with telecommunication issues that affect all of us. In addition, you will also receive free TRAC publications during your membership.
|
|
 |
BUCKS WATCH
Top Ten Ways for High Volume Callers to Save Money on Phone Bills
- Shop by per-minute rate, not monthly fees.
As long distance usage goes up, monthly plan fees take up a smaller percentage of the total bills versus the per-minute charges. For heavy long distance users, it therefore pays to shop for the lowest rate, even if it means paying a higher monthly fee to get that rate. The per-minute savings will exceed the higher monthly fee as more and more minutes are used. Additionally, if your total bill starts to exceed the cost of an unlimited long distance plan, you may want to consider switching to unlimited plans. This is especially true if all your long distance calls are going to be from the same location, versus with a calling card or from a wireless phone. (See item #2 below for more information on these plans)
- Get an unlimited long distance plan.
If you find yourself making more than 500 minutes of long distance calls every month, consider purchasing an unlimited long distance calling plan. Most carriers offer these plans as a bundle with “all-you-can-eat” local plans for around $50- $60 per month after taxes, fees, and surcharges are added. Some plans may offer unlimited calling to Canada and Puerto Rico as part of the package.
- Get all your friends and family members on the same wireless carrier.
Most wireless carriers now offer “free” calling to fellow company subscribers. Callers who make most of their wireless calls to a small group of friends and family may want to try getting everyone on the same plan. Also, most wireless carriers now offer discounts for so-called “family plans,” where two or more subscribers share a larger bucket of minutes. Usually, adding additional subscribers past the first two will cost $10-$20 extra per month. If you are making a long distance call to someone you know is on the same carrier as you and you have “free” long distance in your service plan, call their cell phone and not their land line number – even if you called party is at home or work. You will not be charged the per-minute long distance fees and, if your carrier offers free in-network calling, you may not even use up airtime. Additionally, if you are going to be out of town, have your friends and family call your local cell phone number instead of an out-of-town hotel or office number.
- Consider VoIP.
Heavy long distance users can save by turning their broadband Internet connections into a telephone connection as well. While there are limitations like no service during electrical and broadband outages and fewer jacks in the house, the savings on long distance calling (especially internationally) can save VoIP users money at the end of the month versus buying the same services from a traditional phone company.
- Save on phone lines for second homes.
If you have a vacation home, consider using your cell while there instead of paying for a land line. If you have a high-speed Internet connection but not wireless coverage at the second home consider using VoIP. Most VoIP providers will let you take your “home” number with you, meaning that if you plug in your home VoIP adapter at the second home, calls to your home number will ring at the second home and the caller will not pay long distance fees if the call is a local one. It works as long as you can get high speed internet at your second home.
- Bundle services from one carrier.
The heaviest users can often get better “deals” by concentrating their purchasing with one carrier. Many phone companies will offer a “bundle” of local, long distance, wireless and possibly internet and video services. For those who use all of these services, the best deals may be from a bundle offered by a single carrier. Some carriers are also beginning to treat their “biggest” customers as VIP’s. For example, Verizon offers “Encore” status to some of their customers with a separate customer service number.
- Don’t be afraid to haggle.
Telephone companies are eager to keep their high-volume residential customers happy and may be willing to offer enticements like lower-cost introductory offers, free minutes, or other incentives to keep their business. There tends to be more flexibility in haggling among wireless carriers than wireline local and long distance carriers (perhaps because wireless carriers aren’t as heavily regulated). According to the FCC, 41% of households make ten minutes or less of long distance calls per month and 32% of households make no long distance calls at all. The more you use and spend, the more likely the companies want to keep your business.
- Pay for an all-you-can-eat local calling plan.
Low-volume callers can often save money by switching from an unlimited local calling plan to a metered or limited local plan. However, consumers who make more than 250 minutes of local calls per month will be most likely be better off buying a standard unlimited local calling plan, which generally range from $30-$35 per month, depending on state.
- Look for special packages for frequent international calls.
Callers who call a single international destination frequently can often find calling plans that offer a discounted rate that country for a monthly fee. The sorts of plans are usually only available for calls to Canada, the United Kingdom, or other Western European countries however. Check with your long distance provider to see if they offer discounted plans for calls to your favorite calling destinations.
- Consider getting a residential toll-free number.
Parents of college students and users who make a lot of calls home from hotels or pay phones can save by getting a residential toll-free number. Providers of hotel phones, pay phones, and most college dorms phone systems realize that they have a relatively captive audience and thus charge higher than normal rates. Instead of paying through the nose for these services, a toll-free number will usually cost around $3.00 per month and 10¢ per minute for incoming calls. This may be less expensive too than wireless calling.
WASHINGTON WATCH
A Dollar or Two More a Month? - Kevin Martin, the Chairman of the Federal Communications Commission this past week reiterated in a speech his interest in changing the way the “Universal Service Fund" is financed. Today, it is subsidized primarily as a percentage tax (currently 10.2%) of your “interstate” long distance calling charges. For example, if you spend $10.00 on long distance in a month you will pay about $1.00 in to the Universal Service Fund. Callers who make no long distance calls, therefore, pay nothing. Chairman Martin wants to change this so that each telephone number is assessed a monthly Universal Service Fee. The exact amount is uncertain and he hasn’t offered a specific plan, yet it is widely thought it will amount to between $1.00 and $2.00 per month per phone number. The problem with this plan is that it shifts the cost of universal service on to the backs of the residential and low volume users and away from the heavy volume users. Under the current system, companies that spend $1,000 a month in long distance over 3 lines, for example, could conceivably go from paying $100 per month in tax to paying $6 per month. A low-income family with one line that makes no long distance calls could go from paying nothing to paying $2.00 a month. TRAC does not believe that this is a fair shake for most consumers and therefore has joined the Keep USF Fair Coalition (http://www.keepusffair.org) which has argued for a “hybrid” plan. This plan, named the “Fair Share Plan,” calls for reform in the system to increase the number of people who pay into the Fund and to allow per-number charges only if the percentage fee exceeds 12%.
What do you think? Universal Service Fund money is collected and used to keep the cost of rural telephone service low, help wire schools and libraries to the internet and subsidize phone service to consumers on public assistance. How should we collect this money? Some have called for an abolition of the Universal Service Fund fee altogether in favor of using funds from the 3% Federal Excise Tax for to pay for universal service. The 3% excise tax currently goes in to the general federal treasury. E-mail us your thoughts at trac@trac.org.
WIRELESS WATCH
Try Handsets Out In Store, But Buy Online – One of the worst feelings in the world is buying the latest and greatest wireless handset based on a photo on a website or in a television ad, only to find out that the act of dialing the phone gives you hand cramps, or just feels “weird” when placed against your ear. On the other hand, buying a new phone in a bricks and mortar store often does not yield the same savings that one would find online, since store owners frequently add in their own mark-up. The solution? Try out a handset in the store to make sure it “fits” you, but buy your handset online. Websites often offer good “online only” deals which include free handsets or extra minutes that aren’t available in-store. A good system is to “try on” handsets from several different manufacturers. Most major shopping malls will have stores or kiosks offering phones from all the major carriers, so shopping around is easier. Make note of the handsets you like. Be sure to get all plan information available as well. Don’t get pressured in to signing a service contract by pushy salespeople either. The take your notes with you as you compare prices on the phones and plans with what’s available online. Chances are you’ll find better deals online than you do in store..
TRAC IN THE NEWS
Multitude of Options Makes Shopping Around Harder, Says TRAC – Cutting telephone costs is a great way to shave expenses off your monthly budget, but the range of calling technologies, plans, and services available to consumers can have them throwing up their hands in frustration, noted TRAC Research Associate John Breyault in a recent Orlando Sentinel article. "For consumers, it means they have a lot more options available to them," said Breyault "It's actually harder for consumers to find the best deal to meet their needs." Broadband telephone service, or VoIP is also starting to become increasingly reliable and cost-effective, noted Breyault. "A lot of the things that made people wary of the technology are starting to be corrected," he said. To read the full article, click here.
INTERESTING LINKS
FCC Main Page: http://www.fcc.gov
FCC Complaint Form - http://svartifoss2.fcc.gov/cib/fcc475.cfm
List of State Regulatory Commissions: http://www.naruc.org/displaycommon.cfm?an=15
What do you think? Got a tip you want to share? Nominate your "Scam of the Week" and your "Tip of the Week" - If we select your submission, we'll give you a one-year free membership in TRAC and acknowledge your contribution by name in TRACNotes. Send an e-mail to trac@trac.org to submit your ideas!
TRACNotes is distributed to TRAC members and those who have signed up on the TRAC website "Newscenter." If you do not want to receive TRACNotes, simply click here and let us know. You won't receive these in the future. We hope you choose to remain a part of our network, and that you find TRACNotes helpful. Our goal is to provide you with useful information about what is happening in the telecommunications marketplace for consumers and to keep you up to date on TRAC's policy advocacy. If you like what you see, please consider becoming a member of TRAC by clicking here.
©2005 Telecommunications Research and Action Center. TRAC grants unlimited rights to reproduce TRACNotes or any information contained in it provided attribution is given as follows: "Source: Telecommunications Research and Action Center. http://www.trac.org"
