Telephone bills will get a face-lift in 1998. Consumers will discover new charges on many bills as a result of deregulation in the telecommunications industry. If callers have more than one phone line in their home or business they will be particularly hard hit.
As of Jan. 1, local telephone companies nationwide are raising a federal line fee on second lines. Used primarily for fax machines, Internet access or talk-happy teenagers, costs on these lines will rise from $3.50 to $5.00 a month depending on where callers live. (Last July, many business customers also began paying $3 more a month for extra lines.)
The change will immediately affect about 15 percent of all residential customers in the U.S.
But it will affect even more customers in years to come as they seek access to the Internet.
It's all part of an effort by the Federal Communications Commission, approved in May, to restructure the complex system of subsidies in local and long distance rates for the world of telecom deregulation and competition.
"The FCC is saying we're going to shift from per minute calls to monthly calls per line. So the FCC is collecting the same money through a different mechanism," said Jonathan Sallet of MCI Communications.
Residential users and business users also face new charges in January from their long distance companies - ranging from 50 cents to several dollars on all lines.
Overall, however, the changes are expected to drive per minute long distance toll charges even lower, meaning consumers who make lots of long-distance calls should be winners under the new system. Callers who don't could end up paying slightly more each month.
"For us, it's a wash and for most customers it should be a wash. Obviously, a lot depends on just how much of the toll reduction is passed through by the long distance carriers. And obviously, it depends on whether the customer makes a lot or very few long distance calls," said Frank Gumper of Bell Atlantic.
But many consumer and business groups are in an uproar over the new charges, saying the costs are much too high compared to the actual expense of local services. The critics have asked the FCC to cut the rates. If the government agency doesn't, the critics plan to ask Congress to do the job.