Getting The Message Straight

Changes in telecommunications laws have opened up the telephone service marketplace. But how do youknow which service is best for you?

featuring price breaks or incentives, especially for those making international calls. But at the same time, McEldowney warns, there may also be increased marketing and sales fraud because of these language barriers.

Sifting through the marketing ploys and seemingly endless choices can be confusing and tedious. But there’ll be price breaks, says McEldowney, for phone users who make an abundance of long-distance calls or who “bundle” services, combining their home phone, cellular phone, pager, fax machine and Internet access under one carrier. They’ll see bigger price breaks because they’ll generate greater revenue for the phone company and get higher discounts overall–leaving those who just want basic local or long-distance service with higher monthly bills.

But there are other issues you should consider, pointers to remember and tactics to employ to determine and choose the best deal for your phone dollars.

GET THE 411 FIRST
When long-distance service was divested in 1984, various new companies began competing for customers, both residential and business. To businesses, these companies offered contracts guaranteeing service at fixed rates for a specific length of time. For residential consumers, an all-out pricing war began with long-distance telephone companies offering everything from fixed and cheap rates to rebates–paying consumers to “switch” carriers. Many consumers began shuttling back and forth between carriers and plans, gaining extra cash, while ideally lowering their telephone expenses.

About 2% of all consumer expenses are devoted to telephone service, according to an FCC report. Since virtually all African Americans with incomes between $60,000-$74,999 have telephones (about 2% more than whites and 5% more than Hispanics with the same incomes), it’s critical that consumers do the dirty work of making sure they’re getting their money’s worth.

Even in the face of TV ads offering incredible savings and persistent tele-marketers trying to get you to switch, most people choose to remain with their regional Bell (i.e., NYNEX or PacBell) or with one of the big three. They are familiar with the services offered and aren’t aware of their other options. Until now, these companies have dominated residential and long-distance service.

“I would tell people the quality of the products is essentially the same, therefore, the two main concerns of consumers should be price and attention to customer service,” says David Gusky, executive director of the Wireless Resellers Association. Gusky feels that wireless resale will now increase in popularity, since it was unaffected by last year’s Telecommunications Act. (Resellers buy time from the major telecommunications providers and sell it at a discount to consumers.) He adds that if wireless companies can provide the same volume of calls for as little as $40 a month, they could become legitimate competition for land line service, which is cable-based as opposed to cellular. They may even be able to replace about 20% of the service currently provided by nonwireless companies, he adds.However, this won’t be possible for a couple of years for two reasons. First,wireless service is currently too expensive due to the high cost of licenses and the lack of competition.

However more often than not,

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