BT to offer air miles and free gifts in telephone price war: Mercury savings expected as competition complicates tariffs

BT IS TO cut the cost of international calls by up to 33 per cent and offer air miles and free gifts in the latest round of telephone price wars. Residential customers will be offered discounts of up to 15 per cent, for an annual fee of pounds 24.

The changes, which include new deals for businesses, are the latest in a series of price cuts which BT must make to keep within its regulatory price controls. They bring total price cuts in the last 12 months to pounds 550m.

Don Cruickshank, director general of Oftel, the industry watchdog, said that the cuts were needed under the industry's rules. The new price-control year started in August and customers might look forward to more reductions later this year, he added.

The air miles or gifts will be given in return for points awarded for each pounds 1 on telephone bills (excluding VAT), to encourage people to make more calls.

The new prices include discounts for residential customers of 15 per cent on basic local, national and international call charges and discounts of 10 per cent on calls to mobile telephones. There are also discounts of 10 per cent on calls to premium-rate entertainment and information services. To qualify for the discounts, customers must pay an annual fee of pounds 24.

BT will bring in cuts of up to 33 per cent on cheap-rate calls to Ireland and of up to 20 per cent on standard calls to Japan and Bahrain. There are also savings on calls to Hong Kong, Israel and Scandinavia.

Businesses are being offered five new discount packages with savings of between 14 per cent and 18 per cent on inland calls, plus an additional 3 per cent off most international calls. Companies must pay upfront fees ranging from pounds 7.50 to pounds 515 to qualify.

The Telecommunications Users' Association said that it welcomed the prospect of lower bills but that the cuts helped customers who used the telephone most. The TUA said it would be fairer to cut the costs of local calls for everyone, especially at cheap-rate periods, without making a special charge.

Mercury attacked BT for making call charges more complicated. Mercury, which is expected to announce new prices before BT's changes take effect on 30 June, said that it would continue to offer savings on long-distance and international calls.

The discounts and special tariff packages offered by telecommunications companies have become complex as they fight for market share. BT has 98 per cent of the residential market and 90 per cent of the business market in the United Kingdom. But Mercury has made substantial inroads in specific areas, including the City of London and international calls.

----------------------------------------------------------------- HOW THE TELEPHONE COMPANY RATES COMPARE ----------------------------------------------------------------- BT 30 June Mercury now Cheap Standard Cheap Standard Birmingham 20p 30p 14.1p 24.7p 16p* 24p* 12.7p* 22.2p* Glasgow 20p 30p 14.1p 24.7p 16p* 24p* 12.7p* 22.2p* Dublin 60p 89p 74.0p 95.5p 47p* 70p* 66.6p* 86.0p* Tokyo 296p 311p 331.7p 347.6p 234p* 246p* 298.5p* 312.8p* New York 144p 153p 125.8p 135.4p 113p* 121p* 113.3p* 121.8p* Paris 89p 109p 79.7p 95.5p 70p* 86p* 71.7p* 86.0p* ----------------------------------------------------------------- Calls from London weekday rates. Three-minute call, VAT inclusive. * Minimum payable using discounts and special packages. Mercury offers an additional 5 per cent reduction on all call charges above pounds 60 per quarter. -----------------------------------------------------------------

View from City Road, page 35

Suggested Topics
News
The cartoon produced by Bruce MacKinnon for the Halifax Chronicle-Herald on Thursday, showing the bronze soldiers of the war memorial in Ottawa welcoming Corporal Cirillo into their midst
news
News
peopleFox presenter gives her less than favourable view of women in politics
Voices
Funds raised from the sale of poppies help the members of the armed forces with financial difficulties
voicesLindsey German: The best way of protecting soldiers is to stop sending them into disastrous conflicts
News
The Edge and his wife, Morleigh Steinberg, at the Academy Awards in 2014
peopleGuitarist faces protests over plan to build mansions in Malibu
PROMOTED VIDEO
Have you tried new the Independent Digital Edition apps?
News
ebooksAn unforgettable anthology of contemporary reportage
Property
One bedroom terraced house for sale, Richmond Avenue, Islington, London N1. On with Winkworths for £275,000.
property
Voices
Nigel Farage has backed DJ Mike Read's new Ukip song
voicesNigel Farage: Where is the Left’s outrage over the sexual abuse of girls in the North of England?
News
i100
Arts and Entertainment
Taylor Swift performs at the 2014 iHeart Radio Music Festival
musicReview: 1989's songs attempt to encapsulate dramatic emotional change in a few striking lines
News
Mario Balotelli has been accused of 'threateningly' telling a woman to stop photographing his Ferrari
peoplePolice investigate claim Balotelli acted 'threateningly' towards a woman photographing his Ferrari
Arts and Entertainment
Paul Anderson plays Arthur Shelby in Peaky Blinders series two
tvReview: Arthur Shelby Jr seems to be losing his mind as his younger brother lets him run riot in London
Voices
Don’t try this at home: DIY has now fallen out of favour
voicesNick Harding, who never did know his awl from his elbow, is glad to see the back of it
Arts and Entertainment
Miranda Hart has called time on her award-winning BBC sitcom, Miranda
tv
Sport
Phil Jones (left) attempts to stop the progress of West Bromwich Albion’s James Morrison on Monday
I'm not worried about United's defence - Chelsea test can be the making of Jones and Rojo
Arts and Entertainment
Saw point: Bradley Cooper and Jennifer Lawrence in ‘Serena’
filmReview: Serena is a strangely dour and downbeat affair
Life and Style
The Zinger Double Down King, which is a bun-less burger released in Korea
food + drinkKFC unveils breadless meat beast
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs General

Year 5/6 Teachers needed for supply roles across the region

£110 - £130 per day + Competitive rates of pay: Randstad Education Reading: Ke...

Teacher

£120 - £130 per day: Randstad Education Chelmsford: The JobOur client is looki...

Teacher

£130 - £131 per day: Randstad Education Chelmsford: The JobOur client is looki...

Foundation Stage Teacher

£130 - £131 per day: Randstad Education Chelmsford: The JobOur client is looki...

Day In a Page

Wilko Johnson, now the bad news: musician splits with manager after police investigate assault claims

Wilko Johnson, now the bad news

Former Dr Feelgood splits with manager after police investigate assault claims
Mark Udall: The Democrat Senator with a fight on his hands ahead of the US midterm elections

Mark Udall: The Democrat Senator with a fight on his hands

The Senator for Colorado is for gay rights, for abortion rights – and in the Republicans’ sights as they threaten to take control of the Senate next month
New discoveries show more contact between far-flung prehistoric humans than had been thought

New discoveries show more contact between far-flung prehistoric humans than had been thought

Evidence found of contact between Easter Islanders and South America
Cerys Matthews reveals how her uncle taped 150 interviews for a biography of Dylan Thomas

Cerys Matthews on Dylan Thomas

The singer reveals how her uncle taped 150 interviews for a biography of the famous Welsh poet
DIY is not fun and we've finally realised this as a nation

Homebase closures: 'DIY is not fun'

Homebase has announced the closure of one in four of its stores. Nick Harding, who never did know his awl from his elbow, is glad to see the back of DIY
The Battle of the Five Armies: Air New Zealand releases new Hobbit-inspired in-flight video

Air New Zealand's wizard in-flight video

The airline has released a new Hobbit-inspired clip dubbed "The most epic safety video ever made"
Pumpkin spice is the flavour of the month - but can you stomach the sweetness?

Pumpkin spice is the flavour of the month

The combination of cinnamon, clove, nutmeg (and no actual pumpkin), now flavours everything from lattes to cream cheese in the US
11 best sonic skincare brushes

11 best sonic skincare brushes

Forget the flannel - take skincare to the next level by using your favourite cleanser with a sonic facial brush
Paul Scholes column: I'm not worried about Manchester United's defence - Chelsea test can be the making of Phil Jones and Marcos Rojo

Paul Scholes column

I'm not worried about Manchester United's defence - Chelsea test can be the making of Jones and Rojo
Frank Warren: Boxing has its problems but in all my time I've never seen a crooked fight

Frank Warren: Boxing has its problems but in all my time I've never seen a crooked fight

While other sports are stalked by corruption, we are an easy target for the critics
Jamie Roberts exclusive interview: 'I'm a man of my word – I'll stay in Paris'

Jamie Roberts: 'I'm a man of my word – I'll stay in Paris'

Wales centre says he’s not coming home but is looking to establish himself at Racing Métro
How could three tourists have been battered within an inch of their lives by a burglar in a plush London hotel?

A crime that reveals London's dark heart

How could three tourists have been battered within an inch of their lives by a burglar in a plush London hotel?
Meet 'Porridge' and 'Vampire': Chinese state TV is offering advice for citizens picking a Western moniker

Lost in translation: Western monikers

Chinese state TV is offering advice for citizens picking a Western moniker. Simon Usborne, who met a 'Porridge' and a 'Vampire' while in China, can see the problem
Handy hacks that make life easier: New book reveals how to rid your inbox of spam, protect your passwords and amplify your iPhone

Handy hacks that make life easier

New book reveals how to rid your email inbox of spam, protect your passwords and amplify your iPhone with a loo-roll
KidZania lets children try their hands at being a firefighter, doctor or factory worker for the day

KidZania: It's a small world

The new 'educational entertainment experience' in London's Shepherd's Bush will allow children to try out the jobs that are usually undertaken by adults, including firefighter, doctor or factory worker