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Technology Stocks : IDT *(idtc) following this new issue?* -- Ignore unavailable to you. Want to Upgrade?

To: blankmind who wrote (16417)	11/7/1999 1:08:00 PM
From: blankmind	Respond to of 30916

Phone plans' benefits doubted By D.R. STEWART World Staff Writer 11/5/99 Usually, only high-volume long-distance callers save money, researchers said. Consumers trying to save a buck on their long-distance telephone calls may be paying more a month for a company's nickel- a-minute calling plans than they would by calling at standard rates, consumer and industry officials says. A survey of national long- distance calling plans by Consumer Action, a 28-year-old San Francisco-based organization, found that most long-distance calling plans have recurring monthly fees as high as $9.95. The monthly fees could cost all but high-volume long-distance callers substantially more money than no-fee plans, said Consumer Action researchers. "Our findings are that most people get no benefits unless they are on the phone (long- distance) at least two hours a month," said Ken McEldowney, executive director of Consumer Action. "With effective per minute rates of up to 21.5 cents, for many consumers these 5-cent calling plans aren't worth a plug nickel. "In most cases, callers would have to talk for two or more hours each month before they'd break even with the cost of a no-fee plan." The Federal Communications Commission said that last year the average household spent 144 minutes (two hours, 24 minutes) each month on long-distance calls. The median household spent 79 minutes (one hour, 19 minutes) a month on long- distance calls, the FCC found. In June and again in October, Consumer Action identified eight long-distance calling plans with no monthly fees and 24-hour flat rates ranging from 8 cents to 14.7 cents a minute. Researchers gauged the impact of the monthly fees by taking an average of the no-fee rates (11.5 cents a minute) and comparing it to the actual per minute cost of the nickel-a-minute plans. The study factored in the cost of the monthly fees, figuring the monthly break-even points in hours, effective per minute rates and monthly savings for each plan. Consumer Action reviewed New Jersey-based AT&T Corp.'s Nickel-a-Minute and One Rate 7- Cent Plan; Costa Mesa, Calif.- based GTC Telecom's Long Distance with fee plan and its FreeNet plan; Hackensack, N.J.-based IDT's Long Distance Plan; Jackson, Miss.-based MCI WorldCom Inc.'s 5-Cent Anytime plan and Denver-based Qwest Communications International Inc.'s Communicator plan. The study found that two plans -- AT&T's Nickel-a-Minute and Qwest's Communicator -- would require 2-1/2 hours of use per month to break even with the average no-fee rate of 11.5 cents a minute. GTC Telecom's Long Distance 5-cent plan with $1.95 a month fee would break even after half an hour. Consumers who enrolled in the AT&T Nickel-a-Minute and Qwest Communicator plans and used them for an hour or less each month would be paying 21.5 cents per minute, Consumer Action researchers found. MCI WorldCom customers who sign up for 5 Cents Anytime would pay 19.9 cents per minute in the first hour. GTC Telecom's customers would pay 8.2 cents in the first hour, the study found. Even with monthly use of long-distance service at four or more hours per month, savings were limited by the level of monthly fees, researchers said. At four hours a month, AT&T's Nickel-a-Minute custom ers ($9.95 fee) would save only $5.65 a month compared with consumers who used a no-fee plan with an average rate of 11.5 cents a minute, researchers said. GTC Telecom customers ($1.95 fee) would pay $13.65 less per month. Spokesmen for telecommunications companies, consumer groups and the Oklahoma Corporation Commission said the study underscores the importance of consumers monitoring their telephone use and adopting a long-distance calling plan tailored to the time of day, frequency and duration of their calls. "As telecommunications becomes more competitive, consumers have to be cautious and work hard to understand the terms being offered," said Corporation Commission Chairman Bob Anthony. "What seems like a good deal often isn't."