Set up fee

[#1]

Thank you for giving me another comparison. If you buy petrol that has fractions of a penny in the price each litre is not rounded up to the nearest penny. All the litres you buy are added up and then if there is a fraction of a penny at the end that is rounded up, that's fair enough. That is how phone calls should be calculated. Add all the calls cost per month, round up the amount then add the set up fee's.

[#2]

Not quite.
As an LPG car driver, I have had the experience of buying LPG and Unleaded at the same time.
Each product (the equivalent of each call) are rounded up, resulting in the total overall transaction cost being upto a penny over.
Something seen at Morrisons, Shell and Jet. The Jet one wasn't so obvious but Shell and Morrisons showed a full "x litres at xxxppl" breakdown.
I digress anyhow.
In regards to this, it is indeed the case that the costs incurred here are correct, as they follow the advertised rules. It is interesting as to if this should change though, but sadly this is not my area.

[#3]

From http://www.thisismoney.co.uk/news/article.html?in_article_id=411249&in_page_id=2

Quote

BT price changes to punish light users This is Money 31 July 2006, 2:33pm MILLIONS of BT customers will see their phone bills change after official caps on the company's charges end today. Ofcom has slashed its price controls after 22 years in due to fierce competition in the telecoms market. In response, BT is bringing in a 3p call set-up fee which will hit its 12.6m 'option one' residential customers. The fee replaces the existing 5.5p minimum call charge and will be added to all option one calls, regardless of how long they last. BT is also bringing in per-minute call charges to replace per-second charges. For example, a call lasting two minutes and two seconds would be rounded up and charged as three minutes.

[#4]

The 3p call set up fee that BT charged is now 6p but soon to be 7p
From this page (my bold)
"From 16 September 2008, the call set-up fee for non-inclusive calls from landlines and for non-inclusive Broadband Talk calls will increase from 6p to 7p per call. The existing call set up fee of 3p per call for BT Fusion, In-Contact Plus, Light User Scheme and BT Basic customers remains unchanged."
Also, from BT's tarrif guide, page 3 (my bold):
"Each call charge will be rounded up to a whole penny, except for call charges to non-Mobile 07X numbers, which will be rounded up to a tenth of a penny. Fixed Fee prices where duration charges do not apply will be rounded up to a tenth of a penny. The total call bill will then be rounded up to the next whole penny before VAT is added. VAT will be calculated up to the next whole penny."
Also, from the same page (my bold):
"Duration Rounding - All Residential Customers
The duration of the following call types will be rounded up to
the next whole minute.
• Inland geographic Calls (including g21 rate and ISDN64k calls)
• Calls from Northern Ireland to the Irish Republic
• Calls to Channel Islands
• Fixed-to-mobile calls (excluding ISDN 64k)
• International Calls (including calls to international mobiles but
excluding ISDN 64k and satellite calls e.g Inmarsat)
• The above call types from Private Payphones
• Calls from Private Payphones
• The above Call types via Operator Assistance"
Looks like PN are doing no different than BT but have a cheaper set up fee (4.5p as opposed to 7p).

[#5]

Quote from: Paul03

The 3p call set up fee that BT charged is now 6p but soon to be 7p

I think it's all part of a plan by BT to "encourage" people onto all-inclusive tariffs, though I'm not sure why they want that.
It worked in my case though; we make very few calls but it was still cheaper to go for what was BT Option 3 (anytime?).
The calls to mobiles is now getting silly despite the supposed per-minute reductions, it's almost always better to use a mobile (if you can) for a short call to another mobile.

[#6]

Quote from: HPsauce

The calls to mobiles is now getting silly despite the supposed per-minute reductions, it's almost always better to use a mobile (if you can) for a short call to another mobile.

Quite a minefield, that one! Being on the Weekend and Evening Tariff, I've now 'trained'(!) my husband to use his mobile phone's inclusive minutes for all short calls to landline numbers during the daytime and for any length calls to mobile numbers. My mobile provider has recently introduced a minimum PAYG call charge but it's still cheaper for short daytime calls to my half-price 'favourite' mobile numbers than using the landline but probably not for evening calls.

[#7]

Quote from: Mad

I've now 'trained'(!) my husband

 
You wouldn't like to train my wife too would you?
(she's got a first-class maths degree as well, but still rarely makes the right choice)

[#8]

So as a shareholder in BT I should be laughing all the way to the bank? 

[#9]

HP - I too cannot understand why they want us all to go onto fixed tariffs. I have calculated my telephone calls and with the setup fee + pence per minute even though I am by no means a heavy user of the telephone, the bill would be in excess of the cost of the Anytime+ package that I am currently on. Personally, I believe that the cost of individual calls is extortionate and terrible value for money so that is why I stick to the all-inclusive package.
No doubt it can be explained but 4.5p or 5p to set up a call seems excessive, particularly when the override services can do an entire call for 5p (no pence per minute).

[#10]

If you start to work out the true  cost of phone calls on home phone you soon realise PN are making a lot of money out of this rounding up lark. For instance I made a day time call to a mobile that lasted a fraction over two minutes. This was rounded upto three minutes then the cost was rounded up to whole pence (30p instead of 29.25p.) Then the connection charge was added which again was rounded up to whole pence (5p instead of 4.5p). So a 33.75p call becomes 35p. It may not sound much on one call but if you make a lot of calls it will soon add up.

[#11]

As to PlusNet making a lot of money I don't necessarily agree.  Take my case.  I make virtually no calls during the daytime, only 0800 numbers.  At evenings and weekends I use the phone regularly, keeping inside the hour's limit.  At the end of the month my bill is just £9.99 so that charge has to absorb the cost of all the calls that I have made.
I appreciate that there aren't too many 'tight wads' around like me, but there has to be enough revenue in that 'standing charge' to cover all my calls.

[#12]

It's not just PN that do this, it's fairly standard practice across the board:
From TalkTalk's price list:
"A connection fee of 6p per call will be applied to all chargeable calls made outside of your call plan, excluding those with a fixed fee element or those which are free.
Calls shall be charged in one minute increments (with any part minute rounded up to the nearest minute). Individual call
charges will then be rounded up to the nearest penny. Your total call charges are then rounded up to the nearest penny."
From Virgin Media's price list:
"Call charges are shown in pence per minute but you will be charged for the time you are connected to the network.
Call durations are accurate to plus or minus 1.1 seconds and rounded up to the next minute.
Charge band periods are accurate to within plus or minus one minute.
Call charges are rounded up to the next penny.
A call connection fee of 7p per call applies to all calls unless otherwise stated."
From BT's price list:
"A Call Set-Up Fee of 5.10 pence (exc VAT), 6 pence (inc VAT)
will apply.
Each call charge will be rounded up to a whole penny, except
for call charges to non-Mobile 07X numbers, which will be
rounded up to a tenth of a penny. Fixed Fee prices where
duration charges do not apply will be rounded up to a tenth of
a penny. The total call bill will then be rounded to the nearest
whole penny.
The duration of the following call types will be rounded up to
the next whole minute.
• Inland geographic Calls (including g21 rate and ISDN64k calls)
• Calls from Northern Ireland to the Irish Republic
• Calls to Channel Islands
• Fixed-to-mobile calls (excluding ISDN 64k)
• International Calls (including calls to international mobiles but
excluding ISDN 64k and satellite calls e.g Inmarsat)
• The above call types from Private Payphones
• Calls from Private Payphones
• The above Call types via Operator Assistance (specially assisted)"
BT's connection fee is soon to rise to 7p (see here) as is their charge to dial "3 to return a call" when using 1471 (from 7p to 10p) - on PN this is free!

Given that the call charges and set up fees are higher on other providers, PN still offer a good value phone service.

[#13]

Quote from: coastergrotto

there has to be enough revenue in that 'standing charge' to cover all my calls.

I doubt it very much. More likely the case that call setup charges and higher calls rates have been introduced by phone service providers to offset the losses made on inclusive calls. After all, as a customer if it didn't save you any money you wouldn't take it up. Its always those who use the service the least who end up paying relatively more.
At least with plusnet the rates and charges are less than the competition, and it is what prompted me to switch from the Post Office even though their call charges are not rounded up either to the nearest minute or to the nearest penny until the total is calculated. As I make very few calls it was the removal of the direct debit discount and the doubling of the setup charge that clinched it.

[#14]

Just because everyone's indulging in sharp practice doesn't mean that it's morally defensible.

[#15]

Yes I agree it's not only PlusNet but I'm strugling to think of any other products that are charged in this way. It does seem wrong to me that something is quoted at X pence ends up costing more because parts of it is rounded up several times.