NTS Pricing Structure

When first introduced, the popular 0870 numbers and 0845 numbers were allocated call charges that replicated the then BT call charges for National rate and Local rate calls. As such, 0870 was associated with National call rate charges and 0845 was associated with Local rate charges.

Over time, call charges to land lines have dramatically reduced, yet the charges applied to the 0870 and 0845 Number Translational Services have remained the same.

This change in charging has generated additional revenue. This has enabled companies who use these services to be paid a rebate from the telephone networks for every call made to an 0870 telephone number. Some Companies have taken advantage of these monthly payments to further improve their customer service, and have re-invested the rebate to fund enhancements to their call centre operation.

However, this anomaly in the 0870 and 0845 pricing structures has attracted complaints from public and consumer lobbies and resulted in an Ofcom investigation.

Ofcom, the independent regulator for the UK communications industries, has been reviewing the NTS scheme for the last 18 months.

After considering these concerns, in the summer of 2006 Ofcom announced a number of changes to how NTS will work in the future.

• Ofcom will restore the link between 0870 and geographic calls to ensure that calls to 0870 numbers are charged the same rate, or less, than calls to numbers that begin with 01 or 02.

• Ofcom will end call revenue sharing on 0870 numbers in early 2008.

• (Ofcom will remove the regulatory support for revenue sharing by removing the 0870 range from the scope of the BT NTS Call Origination Condition.)

• The extension of Premium Rate Services regulations to the 0871 range will extend ICSTIS regulations to include 0871. ICSTIS will consult separately on specific proposals to improve price transparency and consumer protection on 0871 calls. This is likely to result in a requirement for all published advertisements to show information on the price of the 0871 calls for example.

At ITC Ltd, we believe that the regulatory changes to 0870 will result in further confusion for the consumer, with the introduction of new number ranges and further confusion over the cost of calls.

The loss of a call rebate for businesses will mean that existing users either:

• Continue with their 0870 number but reduce investment in their call centres or
• Continue to invest in their call centre and move to an alternative NTS telephone number such as 0871 or 0844, both of which will continue to pay a rebate.

Note

• 0870 Number = 8p per minute daytime – rebate to stop in early 2008
• 0871 Number = 5p to 10p per minute daytime – rebate to continue
• 0844 Number = 2p to 5p per minute daytime – rebate to continue

Ofcoms changes to Number Translation Services will result in a period of confusion and disruption. All UK businesses will need to conduct a review of their telecoms strategy, taking into account the options available before deciding on the most appropriate numbering strategy for the future.

If you would like one of our telecommunications consultants to contact you for further advice, please email contact@it-cts.com with your details.

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