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Product category: Communications and utilities
News Release from: uSwitch | Subject: Calling plans
Edited by the Insidemoneytalk Editorial Team on 04 February 2008

BT customers to pay extra £80
million per year[1]

An estimated 9 million BT customers set for 7% hike in line rental resulting in an extra £80 million a year[1]

BT Option 1 and 2 customers to be additionally hit by 23% hike in daytime call rate and potential 1900% [2] hike in evening call rate Option 2 and 3 tariff prices to fall by up to 25%[3]

Telecoms giant BT welcome in Spring with the first line rental hike in two years for customers.

The price increase will hit the estimated 9 million customers across all its calling plans who currently receive their bills by paper, resulting in them paying £80 million extra per year[1] .

In addition, BT Option 1 and 2 customers will see daytime and evening call charges rise, while the cost of the two most inclusive plans, Option 2 and 3 will be cut by up to 25%[3].

The new prices form part of a complete overhaul of BT's calling plans and will be applicable from April 1st 2008.

BT Price Changes Announced 1st February 2008: BT Together Option 1: Plan to be renamed Unlimited Weekend Plan.

From today, customers will receive free weekend calls Those customers who elect to sign up to a 12 month contract will receive free evening calls in addition to the free weekend calls.

Cost of daytime calls up 23% from 3.25p per minute to 4p; evening calls to be charged at 1.5p per minute instead of 4.5p per hour.

Line rental to rise from £11 to £11.75 for customers paying by direct debit, except for those on paper-free billing who will continue to pay £10.50.

BT Together Option 2: Plan to be renamed Unlimited Evening and Weekend Plan.

From April 1st the package price will drop 22% from £3.45 to £2.70 per month.

Cost of daytime calls up 23% from 3.25p per minute to 4p.

Line rental to rise from £11 to £11.75 for customers paying by direct debit, except for those on paper-free billing who will continue to pay £10.50BT.

Together Option 3: Plan to be renamed Unlimited Anytime Plan.

From April 1st the price will drop 25% from £7.95 to £5.95 a month.

Line rental to rise from £11 to £11.75 for customers paying by direct debit, except for those on paper-free billing who will continue to pay £10.50.

Steve Weller, Head of Communications Services, at uSwitch.com comments: "Today's announcement signals BT's ongoing intention to drive customers onto its inclusive calling plans and also to opt for paperless billing.

The price cuts to the Together Option 3 tariff will be welcome news for the 'all you can eat' customers who will enjoy savings of £24[3] a year - although those receiving paper bills will see this offset by the£9 a year rise in line rental.

"Yet for customers on the Option 1 and 2 tariffs, today's news holds a slightly different tune.

From the beginning of April, they will see the cost of daytime calls rocket 23% to 4p per minute[2].

Those making evening calls more than 3 minutes long will also be hit by the rise - while these are currently capped at 4.5p an hour, from the 1st April they will cost 1.5p per minute.

This means that a one hour call on a weekday evening will cost 90p, a 1900% increase[2].

Moreover, for the estimated 60% of BT customers still opting to receive their bills through the post, bills will rise by £80 million a year from the line rental hikes alone.

"BT is giving the 10.8 million Option 1 customers the sweetener of free calls at the weekend, but whether this will be enough to pacify them when they open their April phone bill remains to be seen." Weller concludes: "BT Option 1 customers, looking to stay with their supplier, who still want to make calls in the evening should ensure that they either limit their evening calls to just 3 minutes or sign up to a 12-month contract.

Otherwise we would recommend that they shop around for a better deal and switch supplier." For more information visit www.uSwitch.com or call 0800 093 0607.

[1].

According to a survey conducted by YouGov between February 21st - 28th 2008 of over 10,000 home phone customers, 4,533 were BT customers.

60% of these BT customers said they received paper bills.

Applied to the 14.8 million households with BT, this equates to 8.88 million customers.

Line rental for those receiving paper bills with increase by 0.75p per month or £9 a year, equating to an additional £80 million being paid by customers.

[2].

Cost of daytime calls changing from 3.25p to 4p per minute, a 23% increase.

Cost of evening calls changing from a 4.5 p per hour cap to 1.5p per minute.

An Option 1 customer making a one hour call during a weekday evening could pay 90p according to the new pricing.

[3].

Current Option 2 cost is £3.45 a month, reducing to £2.70 a month, a 22% decrease or £9 per annum.

Current Option 3 cost is £7.95 a month, reducing to £5.95 a month, a 25% decrease or £24 per annum.

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