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Summary

As of July 1, 2015, consumers in the UK are finally benefiting from more clarity as to the price they pay to call service numbers, which has always been considerably more expensive than calling ordinary fixed and mobile numbers, particularly from mobile phones. The separation of the access charge from the service charge should help users understand what they are paying. In addition, calls to “Freephone” numbers (i.e., 0800 or 0808) will for the first time be free from mobile phones.

Elsewhere – in Australia, for example – the market has been more proactive in adapting to the changes and in providing user-friendly options to those who call service numbers from their mobile phones.

“Tariff unbundling” is a welcome move in a market that has lacked transparency

Bill shock due to the use of service numbers has been an increasingly common concern in recent years. The gradual shift from landlines to mobile devices has created a clear case for intervention. Having consulted on the issue, the UK regulator has devised a solution that should increase transparency and reduce the risk of surprise for customers.

The solution adopted has been referred to as “tariff unbundling” because it mandates service providers to advertise charges separately, clearly stating how much of the price of a call goes to the phone provider (“access charge”) and how much to the service provider itself (“service charge”). Until recently, users had a hard time finding out how much they would pay before making a call. Because BT was the only company to have a regulated price for these calls, charges from a BT landline were often the only ones advertised in full. Calls from other landlines could vary; service providers only said that the same call could cost “considerably more” from a mobile. The service charge will now be the same for all calls to service numbers, whether from a fixed or a mobile phone, and must be advertised more clearly by service and communication providers.

Another change relates to calls to “Freephone” numbers in the UK. Despite their name, calling these numbers was free only from landlines until July 1, 2015. This was a further cause of confusion and bill shock: customers often believed they would not pay when dialing such numbers from a mobile. Now they will no longer have to pay for these calls, regardless of the device they use.

A similar change occurred in Australia on the same day, when the communications regulator, the ACMA, announced that it would accept operators’ commitment to offer calls to 1800 numbers free of charge. Vodafone made the announcement independently in May 2015 and other operators followed more recently. In this case the change appears to be more market-driven than in the UK, although the ACMA was well advanced in its plan to enforce a similar provision.

Operators in the country are also offering calling plans that have been called “13-friendly” in that they include calls to 13/1300 numbers in their bundles. These are service numbers in Australia and individual calls to these numbers may have different costs based on whether they are dialed from a fixed or a mobile number.

Appendix

Author

Luca Schiavoni, Senior Analyst, Regulation

luca.schiavoni@ovum.com

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