Cable firms hear the call of the phone: Local television companies are making significant inroads into the business of Mercury and BT, writes Mary Wilson

SINCE the duopoly of BT and Mercury was broken in July last year, 15 cable television companies have set up local telephone networks in a total of 20 areas. These can save a subscriber up to 20 per cent as Keith Conlon, a freelance copywriter and PR consultant, discovered.

He explained: 'I have had some appalling service from BT, and the final straw was when I asked for compensation and was offered a pathetic pounds 50. They are about to lose a possible pounds 60,000-worth of business over the next 30 years, because I will never use them again.

'Videotron are starting up a telephone service in September, and I am going with them. I have to get a new telephone number, which is a bit of a nuisance, but not a new phone.

'My bills on private and business lines add up to pounds 1,700 a month, so I will save between pounds 260 and pounds 380 a year. On top of that the service should be much better and I will be billed every month.'

Videotron, like Mercury and the other cable telephone services, charges per second, rather than in units, where you can be charged for time which you do not actually use. This goes a long way to making them more cost effective. In general local call charges are 15 per cent cheaper than with BT. Installation charges are a fraction of BT's - pounds 20- pounds 50 against BT's pounds 139.36, and the line charges are a little cheaper too.

Michael Storey of Videotron, which has cable television franchises in Southampton and London, said: 'Mercury concentrated on servicing long-distance and international calls and aimed their service primarily at business. We (the cable companies) are able to bring the benefits of competition to the small person.'

Videotron has signed up 100,000 telephone customers in Southampton since early this year and will be in south and west London offering cable television and phone links to up to a million customers by the end of 1992.

All but one of the cable companies offering these phone lines link up with Mercury and therefore, in practice, can offer full national and international service while carrying local calls on their own lines.

Because the equipment is new, customers benefit from modern digital technology. Most companies use fibre optics which means, they say, that the line quality is better, faults are mended faster and prices are lower. Users can take advantage of facilities such as call- barring, call-waiting and call- diversion if they have a 'tone' phone.

At present only 50 per cent of BT's customers can do this, but BT is aiming to have the whole country on digital exchanges by 1996 and is installing 13 new exchanges a week.

You do not need to subscribe to cable TV to use a cable company's telephone service - just be in an area in which they operate. The system works by running a telephone line alongside the TV cables, but eventually both TV and telephone services will use the same fibre-optic lines.

One drawback is that you need a new telephone number. If your phone is a modern one, with plug-in socket, you need not buy a new one. If you rent your phone from BT, you will have to buy it.

Elaine Sturgis of Windsor Cable Television, which also has franchises in Hounslow and Hillingdon, says: 'People have been living with BT for so long they find it hard to change old habits. We can offer a better service, our customer support service is local and we guarantee to deal with a reported fault within four hours. We hope to offer a telephone service to 20,000 within four years.'

Another company, Diamond Cable, which began its service in May, is independent. Gary Davies, the managing director, said: 'We have our own digital exchange and although we pass traffic into the BT service, we are not in partnership like the others.'

(Photograph omitted)