Premium Rate Regulation Changes for Business

by | Apr 19, 2016 | Business Advice, Communication, Happier Customers, Make More Sales, SMEs

Back in July 2015 OFCOM released premium rate regulation changes to the way non-geographic service numbers are charged for people to contact you.

Research has found that telephone users are confused about how much it costs to call service numbers. This means people can lack confidence in these numbers, and sometimes avoid using them. We highlighted how Premium Rate Numbers can Slay SME Sales in this post a few months ago. [tl;dr you’re better off without them.]

If you’re not convinced, or not ready, to let go of your premium rate number just yet – we’ve compiled all the details you need to know about the regulation changes and how to avoid any penalties.

The new system enforces organisations to state how much calls to them will cost. The changes have been implemented on 1 July 2015 under the strapline ‘UK Calling’. The communications regulator Ofcom has worked with major phone companies to communicate the changes to consumers.

The cost to the consumer of calling a service number (starting 084, 087, 09 or 118) must now be made up of two clear parts:

ACCESS CHARGE
This goes to the caller’s telephone company, charged as pence per minute.

SERVICE CHARGE
This is the remainder; it includes any revenue going to the service provider (that is you, the party being called), as well as revenue going to the ‘terminating call provider’ (or TCP: the company that provides the number to you).
In another change happening at the same time, all Freephone numbers beginning 0800 or 0808 were made free for consumers to call from mobile phones, just as they usually were from landlines.

50% of sales time is wasted on unproductive prospecting – generate leads using our Email Prospecting 101 [Google Slides] 

How To Avoid Premium Rate Regulation Change Penalties

STEP ONE
Talk to your provider [now might be a good time to find a better provider who would have warned you of this ages ago!] If you haven’t done so already, you may wish to discuss with them how the changes affect your organisation and the way you use service numbers. If they aren’t able to help – one of our system architects will happily analyse your call flows and offer suggestions. Talk to them here.

STEP TWO
Confirm the service charges for your number[s].

STEP THREE
Decide if you are happy with your service charges. If not, the service charge linked to the number or numbers you currently use, you may need to consider changing your telephone number[s].

STEP FOUR
Review all marketing materials and advertising. If your business or organisation is contacted on a number beginning 084, 087, 09 or 118, you must ensure that your service charge is clearly displayed wherever you advertise or promote that number. This includes websites, print ads, social media accounts, business cards, etc. The service charge should be prominent and in close proximity to the number itself. The recommended form of wording is:

“Calls cost xp [or xp per minute] plus your phone company’s access charge.”

This means your service charge should be provided alongside the related number in all communications directed towards current or potential users of the service, where the use of the number is promoted or advertised.

Frequently Asked Premium Rate Regulatory Change Questions

What's changing and why?

If your organisation uses a ‘non-geographic’ service number for people to contact you – that’s one beginning 08, 09 or 118 – you need to be aware of major changes to how these numbers are charged.

The new system will enable organisations to say how much calls to them will cost. The changes have been implemented from 1st July 2015 under the strapline ‘UK Calling’. The communications regulator Ofcom is working with major phone companies to communicate the changes to consumers.

In future, the cost to the consumer of calling a service number (starting 084, 087, 09 or 118) will be split into two clear parts:

An access charge. This goes to the caller’s telephone company.
A service charge. This is the remainder; it includes any revenue going to the service provider (that is you, the party being called), as well as revenue going to the ‘terminating call provider’ (the company which provides the number to you).
In another change happening at the same time, all Freephone numbers beginning 0800 or 0808 are being made free for consumers to call from mobile phones, just as they usually are from landlines.

These changes are expected to bring greater clarity to the cost of calls and improve confidence in a system which phone users have said they find confusing and unclear. This will also benefit organisations which use these numbers, by introducing greater confidence into the market.
Which numbers are affected?
The numbers where access and service charges will apply are those beginning 0843, 0844, 0845, 0870, 0871, 0872, 0873, 09, and 118.

Freephone numbers beginning 0800 or 0808 will be made free from mobiles.
What is wrong with the current system?
Consumers have said they find the current system confusing, not least because each telephone company selects its own level and structure of prices – per call, per minute, and varying depending whether they are included in call bundles. This has resulted in the market not working well for consumers or the organisations being called.

When did the changes come into effect?

All the changes were implemented on 1 July 2015.

Will all promotional materials need to carry details of the cost of calls?

In short – yes.

Who will enforce this?

PhonepayPlus and the Advertising Standards Authority (ASA) will continue to regulate this area. More information is available on their websites, including details about what types of material falls within their remit.

The 084 number range, and any 087 numbers with a service charge of less than 7p per minute (or 7p if the call has a fixed per-call charge), will be regulated by the ASA.

The 09 and 118 number ranges, as well as any 087 numbers with a service charge of 7p per minute (or a 7p fixed per-call charge or higher), will be regulated by PhonepayPlus (all figures are inclusive of VAT).
What happens if I don’t include this information on everything from the day the changes come into force? Will there be penalties?
PhonepayPlus and the Advertising Standards Authority will be responsible for enforcing the requirements for including service charge information. http://www.phonepayplus.org.uk/for-business/if-phonepayplus-investigates-your-service

We currently do not have to publish pricing information in adverts. Will that need to change?

Yes, in future you will need to include information about the cost of the service charge for calling these numbers in adverts and website. This will bring these numbers into line with other non-geographic numbers.

Can I keep my current number(s)?

Yes. There is no requirement to change the numbers you use. You may wish to consult with your terminating call provider – the company that provides you with call services.
Will the cost of calling the number(s) I use change?
If you use a number starting 0800 or 0808, this will become free to call for consumers from mobile phones.

For the other affected number ranges, the ‘access charge’ element of the call will be determined by the caller’s telephone provider. Because the access charge will apply across the different non-geographic number ranges, there may be a small change in the overall cost of some calls.

You will be advised of the service charge which will apply to your contact number by your terminating call provider – the company that provides you with call services – ahead of the implementation of the changes. Ofcom expects service charge price points to be made available which match the existing cost of calls to your number.
I currently receive a share of the revenue from calls. Will I have to disclose how much I receive from each call?
You will not be obliged to disclose how much you receive from a call. However, you will have to disclose the service charge for the call. The service charge is the sum of all revenue from the call which is not retained by the caller’s telephone company. The service charge will be the same from all telephones, and the level will usually be set for a given block of numbers allocated by Ofcom (usually these are in blocks of 10,000 numbers blocks). You will need to talk to your terminating call provider – the company that provides you with call services – to determine what the service charge will be for your existing numbers.

Are you going to impose caps on the price of calls to certain numbers?

Calls to numbers starting 0800 and 0808 will be free to call for consumers. There will be caps on the maximum amount of the service charge for the other affected non-geographic numbers, with the exception of 118 directory-enquiry numbers, with the caps varying according to the number range. The 084 and 087 ranges will be capped at 7p and 13p respectively (per minute or as a fixed fee and including VAT). The 09 range will be capped at £3 per minute and £5 per call (including VAT).

What happens when your prospects can’t get in touch with you?