A 40-minute phone call for $63. Two minutes for $9.53. Motivated by pay phone gouging stories like these, federal regulators moved Thursday to make sure people can find out a call’s price before they make it and not be surprised by a fat bill later.
“I think some of the consumers who were complaining believed that they could have purchased the phone booth for the price of the phone call,” said FCC Commissioner Susan Ness.
Both those examples, cited by Federal Communications Commission Chairman Bill Kennard, were for long-distance calls within the United States and are among the thousands of similar complaints filed with the FCC in the last couple of years.
The FCC adopted stiffer rules Thursday to protect callers from unknowingly being charged high rates for long-distance calls made from public phones. The rules require all companies that provide service to pay phones, hotel phones and other public phones to disclose price information to callers before calls are connected.
The FCC’s action does not change what companies charge for such service. But the commission believes the disclosure requirement eventually will pressure companies with high rates to lower them.
Behind each pay phone is a company responsible for its service - from carrying calls to providing operator assistance. Hundreds of companies are in this business, including AT&T;, MCI and Sprint. Smaller companies serve hundreds of thousands of phones.
Although callers would not be charged directly for price information, companies will be allowed to pass along to customers any increased costs resulting from complying with the FCC’s plan.
“This undoubtedly will push our costs up,” a Sprint spokeswoman said. She didn’t know by how much and whether Sprint would increase charges to customers as a result.
AT&T; agreed. “The FCC today, instead of targeting the companies that charge rip-off rates, is applying a regulatory solution that will unnecessarily raise costs to the entire long-distance industry. Those costs could ultimately affect consumer prices.”
MCI said it already discloses pricing and supports the FCC’s action.
One way callers can avoid being hit with high charges is by connecting directly with their preferred long-distance company.
To do that, people can dial an 800 or 950 access code on their calling card before dialing the number. That bypasses the hotel or pay phone and connects directly with the usual long-distance carrier. When that happens, companies wouldn’t be required by the FCC’s plan to provide price information.
But FCC Commissioner Gloria Tristani said she worries about people who find out they are going to get socked with a high rate, really need to make a call and don’t have a preferred long-distance company to avoid it. “They really don’t have options,” she said.
xxxx NEW RULES Here’s how the FCC plan works: After dialing a long-distance number from a pay phone, hotel phone or other public phone, callers would hear a recorded message giving them the option to get price information. If callers want that information, they would press the pound or star key or stay on the line. Then the company providing service to the phone would disclose the per-minute charges as well as any surcharges. After getting the information, callers could hang up without incurring any charges. If callers don’t want price information, they could bypass the message. The rules take effect July 1.