BT to raise prices for line rental, calls to landlines
Summary: The telecoms provider will hike its line rental prices by the same amount as the now-scrapped next-generation broadband levy, but also make calls to mobiles cheaper
BT is to raise its line rental fees by 50p a month, the same amount that was to have been charged for Labour's now-scrapped next-generation broadband levy.
The hike was announced on Monday, along with a severe price rise for non-inclusive daytime calls to landlines, which will go up almost 13 times from 0.5p to 6.4p per minute. The set-up fee for each call will also go up from 1p to 10.9p, and the call return charge will go up from 4.2p to 16.5p. All these rises will take place from 1 October.
By way of comparison, a three-minute call between landline phones will cost 2.5p before 1 October, and 30.1p afterwards.
However, BT also told ZDNet UK that it will soon test out adding calls to mobiles into standard call packages. At the moment, such calls are charged separately and at higher cost, so the move would make it cheaper for most people to phone someone on a mobile phone from a landline.
"The calling patterns of customers means the impact of the daytime rate and set-up fee changes will be minimal," BT said in its statement on Monday. "More than half our customers are on inclusive calling packages and don't pay charges for most calls."
The previous government had proposed a 50p-per-month levy on each copper broadband connection, in order to subsidise the roll-out of fast, fibre-based broadband to rural areas deemed insufficiently profitable by the private sector. The Tories always opposed the scheme, and it was shelved by Labour shortly before the May election.
BT said that the fact it is raising its line rental charges by the same amount as the scrapped levy was "a coincidence". "Basically, it's to ensure that we can offer discounts and competitive pricing going forward," a company spokesman told ZDNet UK. "It's so we can stay competitive in these recessionary times."
The telco will run a limited offer until 29 October, where subscribers can pay for their next year's line rental upfront, in exchange for an annual saving of up to £45.60.
BT told ZDNet UK that it intends to lower its prices for calling mobiles in response to looming cuts in the UK's mobile termination rates (MTRs). The company was a vocal campaigner for the MTR cuts, which make it cheaper for a fixed or mobile operator to connect their customer's calls to a mobile operator's customers.
"We're planning to introduce all-you-can-eat packages," BT's spokesman said. "We will shortly be announcing trials of plans that include calls to mobiles."
The analyst house Ovum pointed out that BT's price hikes come "hot on the heels of a recently agreed pay deal with the CWU, and a hike in the wholesale price it pays for its sport content for BT Vision".
"One of the headline stories for BT last financial year was its ability to reduce costs and thereby improve margins, particularly at BT Retail," Ovum analyst Mark Giles said in a statement on Monday. "This latest move is clearly designed to help it maintain this momentum; however, it should be wary of forcing customers not currently bound by a contract to pay more for their service, as this could well drive up churn levels."
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Talkback
These price rises are insane! non inclusive to landlines up 13x the connection up 10x and and a call return up 4x plus the extra 50p per months line rental! The only reason why low income family's take up non-inclusive in the first place, is because they can't bloody afford inclusive packages!
So for the sake of BT investing a little bit of money on their current roll-out schemes (Overdue.) in return they get to steal ten times that amount back from the people! on top of this the government is letting BT amongst other's hand pick out regulatory changes that favour themselves even further, financially no doubt.
Im paying for calls I cant ever use already on a mobile contract and another hike on my land-line I never use because I need it for broadband
Time for a shake up and a better deal
BT landlines have become less of an attractive proposition, even if they are still considered by many to be a necessary 'evil' due to ongoing 999 routing/registration issues via low cost line-rental-less VoIP services. However, even those issues are being sorted, and so it is getting close to the time (if we haven't reached that time already) when BT lines must be considered no more than an expensive home extra for a lot of people. It's simply a land line tied to an address after all, and for no ADSL users it must surely be a hard to justify expense.
I currently pay BT for their unlimited calls service, which means a fixed DD each month of £16.54 (includes online discounts) which provides me with all inclusive calls any time of day etc. Good? Well, this service is going to cost me over £200 per annum very soon. But for what? In reality I hardly use it. Even with my irregular hours I use the land phone only occasionally. No ADSL either as I am cabled (VM) so the only reason I have for keeping it is courtesy, in that many other people are unhappy and or unwilling to phone mobiles as it costs them quite a lot more...which is a reasonable position, and I do sympathise. I also pay £14.00 per quarter for a pair of VoIP lines, although I don't currently use the lines for outgoing calls (one for voicemail and, one, almost redundant, for FAX). However, I may have to reconsider using these for making calls, even though VoIP services generally don't offer 'call packages'; you do ultimately pay per call. And then on top of those charges there's my (and my wife's) mobile charges. Seems like I'm paying out a lot already for communications, and usage really is non excessive.
Give all the aforementioned, I for one will be considering letting my BT landline go when the contract expires. I may not save £200+ per year, as some call costs will be added to the other services, but my VoIP lines are infinitely more useful than my BT line, far cheaper, and so I'd rather keep them and save. And if BT are going to have all-inclusive deals, that is, free calls to mobiles under their packages, I shalln't feel so guilty about going 'mobile only'. All this expense, not mentioning handsets, for the ability to say or send a few words from almost anywhere. Crazy times.
Now my last two bills with regards to the calls below 50p section I have apparently made 28 calls all totalling to the grand time of 52 seconds, the charge? £7.37p and as stated this section is not itemised so I cannot see what's what, that's for July it's a similar story for June.
Calls above 50p for July total to six these are itemised and most are to mobiles with a roughly combined call duration time of 60 minutes the charge? £6.28p, go figure? I haven't a clue how they get to this point.
But it is a matter I am currently pursuing because this wasn't always the case this has only come about within the last quarter for my account no other changes to my plan, it's ironic because the phone call section of the bill used to be fully itemised, non of this above/below 50p bollocks.
I'm starting to wonder if virgin introduced this method purely as a way of increasing their monthly percentages of revenue without the majority spotting it.