Calling via, say, London can prove cheaper than local options. Stephen Pritchard looks at ways of cutting online costs
For most Internet users, the greatest fear is not viruses, hackers or pornography. It is phone bills. If you go online during office hours, and you do not have a local service provider, you will pay just under 10 pence per minute, including VAT. Checking electronic mail once a day (say, two minutes online) would cost pounds 50 a year. If you use the World Wide Web or file transfer, your bill will be much higher. Every additional hour a week on line adds another pounds 300 to the phone bill. That is why it makes sense to find an Internet provider that minimises your call charges.

The best option is to choose an Internet provider with a local telephone number. The term "local" should be used carefully, however. At BT, it means your phone code area and the adjacent codes. (One exception is that calls from Home County towns, such as Watford, to the 0171 central London code area are still local, even though the 0181 zone lies in between.)

However, some Internet providers still refer to all calls up to 35 miles as local: they are thus including the intermediate regional tariff (formally the "a" rate). That means they can market their dial-in points (known as points of presence or PoPs) as local, even though you may not be paying a truly local rate. Indeed, the big difference is often between the local and regional tariffs, rather than between regional and national.

Anyone in the largest conurbations, including London, Manchester, Glasgow and Birmingham, should have a choice of Internet providers offering truly local points of presence. Smaller cities such as Bristol and Cambridge are also well served, and companies such as Demon and Pipex are adding to their networks on a regular basis.

If a local PoP is not available, the choice is less clear. It is not necessarily sensible to choose the closest one, because the difference between national and regional calls has narrowed. At the weekends, they both cost 3.3 pence a minute, so if that is when you usually go online, shop nationally. It could bring you better technical support or a lower monthly standing charge.

For daytime users, the difference between national and regional calls is 1.5 pence a minute. This could still be worth paying if the Internet provider in, say, London uses faster modems than one in Birmingham and you are in Worcester (which is a "regional" call from Birmingham). You should ask potential providers if they have modems that operate at 28,800 bps, the fastest currently available: it could save you time and money.

For Mercury customers, the company's new residential call plan has just one call tier (Mercury is not meant for local calls), so this logic applies all the more. Mercury is developing an alternative pricing plan for customers who make a large number of short calls - typically with a fax or modem.

Cable customers should have the best deals of all. Some Internet providers, such as Pavilion, Nynex and Videotron now have cable lines, taking advantage of the operators' free off-peak calls between cable customers. However, Nynex and Diamond have said they intend to withdraw or renegotiate this facility, which could be the beginning of the end (see accompanying article).

The only way to avoid call charges altogether is to lease a direct connection to the Net from Pipex, BT or EUNet. This is a much faster connection, at a full 64,000 bps, but it also requires a thorough knowledge of programming and can cost pounds 10,000 a year. That's a lot of phone calls.

Charges: at a glance

National Regional Local


Peak 9.8p 8.3p 4p Evening 5.8p 4.0p 1.7p Weekend 3.3p 3.3p 1.0p


Peak 7.52p 7.52p n/a

Other times 2.94p 2.94p n/a

NB Both Mercury and BT have minimum call charges. At BT, the minimum charge is just under five pence, which more or less equates to the old fixed charge of one unit. This means that you will not save anything if you log on to a local provider for less than five minutes at weekends. Mercury charges a 'call connection fee' of three pence per call - so again, lots of very short calls work out more expensive than one longer one.

Charges are before any discounts or loyalty schemes are applied and for Mercury exclude the membership charge (pounds 23.50 a year) and the call connection charge of pounds 3.53. All charges include VAT.