Dial 0870 for rip-off

7 June 2007

Which? is calling on companies to stop using revenue-sharing phone numbers for customer service lines as they are confusing and expensive.

The consumer organisation asked members of the public whether they knew what they were paying when they dialled various phone codes.* Most answered incorrectly or didn’t know the costs involved when calling 0870 – one of the most expensive numbers.

Organisations that use 0845, 0844 and the higher charging 0870 and 0871 numbers can share the revenue from calls with the phone service provider – BT or Orange, for example. So the longer customers stay on the line, the more companies earn.

Which? called a range of customer service departments or helplines – broadband, energy and government agencies - that use revenue-sharing numbers.** Of the organisations called, the energy companies – which use 0845 numbers – had the longest waiting times, with an average of three and a half minutes wait to query a bill.

Npower was the worst of the companies Which? called, keeping researchers waiting seven minutes on average – which would cost 24p from a BT landline but up to £1.05 on a mobile phone.

A ten-minute daytime call from a BT landline to a geographic number (01/02) could cost as little as 3p, but the same call could cost about 80p to an 0870 number. According to premium-rate regulator Icstis, consumers spend more than £300 million a year dialling 0871.***

Ofcom is introducing yet another code later this year: 03 numbers which will cost the same price as a geographic call and won’t be revenue-sharing. Which? is calling for companies and government agencies that use revenue-sharing numbers for their customer support or advice lines to adopt the cheaper 03 code.****

Neil Fowler, Editor, Which?, said:

“Revenue-sharing is a stealth tax of the worst kind. Tales of customers hanging on for ages at huge expense when they are trying to place an order - or even make a complaint - are numerous. Where once businesses paid to look after customers, it now seems that customers must pay for the privilege of businesses looking after them.”

Notes to editors

* In March 2007 Which? asked 1,003 members of the public how much they thought 01/02, 0800, 0870 and 09 numbers cost to call from landlines and mobiles.

** In March 2007, Which? called the customer-service departments of eight broadband, five energy companies and five government agencies which use revenue sharing numbers. Researchers called each department ten times during the weekday lunchtime period, when the public is most likely to be trying to get through. To be as fair as possible, Which? didn’t call on a Monday when there is likely to be a greater number of calls. Researchers timed how long they were on the phone before they got through to a person.

Broadband providers kept callers waiting on average a minute and a half on hold. TalkTalk and Virgin Media kept researchers on hold the longest, at just over two and a half minutes on average. One caller to Virgin Media’s 0845 number waited more than 10 minutes.

*** It’s hard to know how much firms make from revenue-sharing numbers. A clue came when the Department for Work and Pensions disclosed that it made £268,000 last year from 0845 hotlines to advise those on low incomes about benefit and winter fuel payments.

Customers sometimes have to call a revenue-sharing number to complain about a problem of a company’s own making. And some banks, including Alliance and Leicester and Lloyds TSB, even use 0870 lines to provide advice to customers with debt problems.

Which? publishes an 01 geographic number alongside an 0845 number. It doesn’t receive any revenue from its 0845 number, but for a small minority of people it’s cheaper than a geographic number.

****Which? also hopes that Ofcom and telephone companies publicise 03 numbers and let the public know what they mean, or the new code will only add to the existing confusion.

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