Cell Phones













Talk isn't cheap? For cellphone users, not talking is costly too

A study shows many customers pay for much more time than they use

If you're like most cellphone users, you probably think you're paying less than 10 cents per minute for calls. Think again.

When you do the math, you find the average cellphone customer actually pays more than $3 per minute, according to a report being issued this week by the Utility Consumers' Action Network, a San Diego consumer advocacy group.

I got a sneak peek at the report the other day.


Cellphone bills: David Lazarus' column in Business on March 8 said a study of high cellphone charges was based on a survey of more than 700 San Diego customers' bills. In fact, the study, conducted by the auditing firm TeleTruth on behalf of the Utility Consumers' Action Network and showing an average charge of $3.02 per minute, was based on 134 wireless bills. TeleTruth contends that the methodology of the study supports the validity of the findings that the column reported.

Researchers arrived at the average $3.02-per-minute charge by comparing the average number of minutes charged in more than 700 San Diego consumers' telecom bills and dividing by the average number of actual minutes used.

"We knew it was a myth that wireless costs were going down," said Michael Shames, UCAN's executive director. "But we were blown away by the actual costs."

That $3-per-minute figure is skewed by the relatively small percentage of people who pay for a lot of minutes but barely use any. But even when those folk are taken out of the mix, most wireless customers still pay between 50 cents and $1 per minute, the study found.

Shames said this wasn't a problem just for San Diego residents. He said the findings of the report were representative of cellphone use and bills nationwide.

That's something to keep in mind as an increasing number of people abandon traditional land lines and embrace a wireless-only lifestyle. More than ever, you have to make sure you're in a calling plan that fits your needs.

Among other findings in the report:

* Only about 8% of land line customers pay less than 10 cents per minute for long-distance calls. The majority pay well over 10 cents per minute, with 20% of people paying more than 50 cents per minute and 10% paying more than $1.

* The cost of additional phone services has soared. In AT&T's case, the cost of call waiting has risen 86% since 2004, the cost of an unlisted number is up 346% and the cost of directory assistance has skyrocketed 1,630%.

* The average cellphone customer uses only about a third of "any time minutes" allowed by most wireless plans. The rest are paid for but wasted.

Many of the findings -- particularly the average cost per minute of wireless service -- have been speculated about for years by telecom observers. The UCAN report represents one of the first attempts to quantify costs based on a relatively broad sample of customers.

Bottom line: Most telecom customers are buying more product than they use, and that's pure gravy for service providers.



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