BT call rates `are the most expensive'

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TELECOMS EXPERTS who have analysed British Telecom's latest changes in its telephone charges say the best way to save money is simple: don't stay with BT.

"Sign up with another operator," recommended Richard Bayliss, UK tariffs analyst at the independent consultancy Phillips Tarifica. "Over the years, BT haven't put their prices down any further than they've had to."

Now, cable operators including NTL and Cable & Wireless are better value for almost any user, he said. By shopping around, consumers should be able to avoid connection fees (which can be up to pounds 99), and may get free Internet access and even cable channels as part of their new telecoms package.

In addition new regulations mean that customers can retain the same telephone number even after changing supplier.

The analysts' review was prompted by BT's announcement last week of a mixture of cuts in call prices linked with a small rise in the quarterly rental charge for their phone lines. Though the telecoms watchdog Oftel pronounced itself satisfied with the cuts, rivals and analysts were less persuaded.

"While BT does appear to be trying to `de-confuse' its customers, their line rental is still going up," said Steven Wagner, group managing director of NTL, which is on the verge of becoming the UK's biggest cable operator through a merger with Cable & Wireless Communications.

BT was forced to change the call charges in line with Oftel rulings which oblige it to reduce them by 4.5 per cent in real terms every year.

But the choice of which provider is best is increasingly complicated by three factors - the rise of the Internet (which means people are spending longer on the phone), the availability of digital TV, and the rise of "call resellers" for customers wishing to make international calls.

The Internet has had a profound effect on telephone business. For example, an analysis of figures provided by BT to Oftel suggests that in 1987-8, for each three months the average telephone user made 12 hours of local calls, three hours of national calls and less than an hour of international calls.

But in 1998 the number of Internet users roughly doubled to 7.5 million, or 16 per cent of the adult population. On average, Net users spend about 16 minutes on-line daily - equivalent to 24 hours in a three-month period, more than doubling their phone use compared to the 1997-8 model.

For that reason, says Mr Bayliss, it is worth taking care to analyse the schemes available from different would-be suppliers. NTL said that it can offer its service in any part of the country. Local cable companies may also offer their own scheme.

Digital TV can also be a hook to pull in dithering customers. NTL offers eight channels, and the promise of digital TV, for those who sign up. "That's the hook to get you interested," said Mr Bayliss. "You start with the basic package spending pounds 20 a month for those and then pretty quickly you find you've signed up for Sky Sports and Movies and you're spending pounds 50 a month."

For those with relatives abroad, the rise of "resellers" - who reserve time on international phone lines and then make it available via a passcode to subscribers - has meant that standard phone companies cannot compete.

People with relatives abroad should examine the deals available in newspapers and simply switch between resellers, picking the best deal for the country and time they want, analysts say. "It's just a question of picking them up in newsagents - and if you see a better one next week, go with that."