4/29/2009 2:26:00 PM
0800 charges are scaring customers
Another week, and another watchdog identifying ‘unfair’ charges levied by the mobile industry onto the consumer. This time it’s so-called ‘non-geographic numbers’ – those prefixed with 08 or 09, especially 0870 and 0800. Varying termination rates from such numbers are flagged by the networks as the central obstacle to making these numbers available in their bundles. Termination rates cause uncertainty and inconsistency in costs incurred by operators from non-geographical calls. But if the uncertainty and inconsistency for consumers was removed, operators are likely to have better spending and more loyal customers in the longer term.
Consumers are understandably irked for having to pay separately for numbers advertised as local, national or free, especially as more and more services, ranging from banking to shops to local police stations, use 0800 or 0870 prefixes. Mobile operators would clearly make less money from customers calling these numbers than from a call to someone on the same network, but even in these times where every pound counts, there is an element of being penny wise and pound foolish by passing on these charges to the consumer without an easily understood explanation.
Operators’ revenue from these charges is relatively small. Is that extra revenue worth reinforcing all the negative impressions that many consumers have of the mobile industry, from high roaming charges, slamming, mis-selling and cashback? The perceived ‘hidden charges’ from non-geographical calls also serve to engender greater caution from consumers to embrace new services such as mobile internet.
With retaining customers the most critical metric, there is a business case for the operators to take on the fluctuating charges from those 0800 and 0870 numbers in exchange for having more satisfied customers.