What is the justification for charging non geographic local phone numbers?

[#1]

<forum topic edited>
Forgive me if this topic has been discussed recently - I didn't spot it looking back through the last three pages of forum posts.
I am curious.

It seems to me that it's a rather cheap thing to charge for 0800 / 0845 numbers and, I believe, generally considered to be an unfair / hidden practice - to the point where Ofcom are calling for changes (I cite http://consumers.ofcom.org.uk/2012/04/simplified-call-charges-to-help-consumers/ )
PlusNet in most respects are truly exemplary and traditionally open about most things (for instance the way the email fiasco was handled a few years back was laudable example of both ethics and best practise).
What is the justification for charging connection and per minute fees on these numbers? I expect such things from the likes of Talk Talk but not from PlusNet, who are, after all, part of BT .

It would be another `differentiator` (sp) and a  major selling point for your phone product if you was to discard both tariff charges, especially to those potential customers who are struggling financially in the current economic climate and, given services like http://www.saynoto0870.com , would have a relatively small impact to your bottom line.
I guess I have two questions at the end of the day:

• How are the charges justified by PlusNet management?
  
• Are there near-future plans to change this distasteful practice?

Yours in anticipation of continued best communications practice
   Tom Jasper, loyal customer and private advocate of PlusNet..

[#2]

Tom, calls to 0800 numbers are free from Plusnet provisioned land lines. Most calls to 0845 numbers can also be made using the included minutes provided with your call package. The pricing for call charges in general is partially driven from the Wholesale costs we're expected to pay to BT Openreach.

[#3]

Bob.,
Thank you very much for such a quick reply. I very much appreciate it (and had both hoped and expected).
I searched for reference to 0800 numbers being free on the website but didn't succeed in finding it (only charges for non-geographic numbers) - it may be there somewhere and I may have simply skipped over it.
My motive for asking was two fold. Firstly a dear friend of ours who's in dire straits, both financially and health wise, recently racked up a huge bill (one of your  / our competitors) trying (successfully, helped) to sort out errors generated by DWP (and local government) and I saw the subsequent distress caused by that.
I understand that the BT Wholesale contract incurs cross charging to the customer although once again, I struggle to see how this is right.
By "right" I mean as in companies pushing all their profits as royalties and playing the country transfer game to ensure that they pay the minimum amount of tax whilst complying with all tax laws.
I took a peak at BT Wholesale pricing (actually it was a bit of a minefield to find the pricing)  and, although I probably didn't find the most recent pricing, looking at the carrier price list B1_06a.xls embedded within ncc_cpl1.zip linked through https://www.btwholesale.com/pages/static/Carrier_Price_List_Guidance_Slides/index.htm there appears to be sufficient profit to swallow the non-geographic number charges or at least reduce the margin. (note that all this stuff is publicly accessible, although any preferential or other contract specific to the carrier won't be).
So I ask again, what is the justification, maintaining the "do the right thing" slant.
With regards to when (if at all) I wonder if any change could happen sooner rather than latter (if Ofcom are successful). It would be a nice offset from the apparently early pass through of the recent BT price hikes (shifted again, I think, to the 5th of Jan 2013, citing http://bt.custhelp.com/app/answers/detail/a_id/35832/~/price-changes-from-5-january-2013) although, I think, the line rental saver I purchased was based on the new pricing (£113,68)
Thank you once again for openly continuing this perhaps uncomfortable conversation.
Tom

[#4]

Thanks Bob
Just to add - 74% of all calls to 0845 numbers last month were free across our current three call packages, this rises to 84% for Anytime customers. The only calls to 0845 numbers which are not included in your tariff are calling cards, dial up internet numbers, etc.
@TomJasper
Your request for justification of our call pricing structure is identical to that of any company that is not a charity - we have salaries to pay, overheads to cover and after all - a profit to make, without which we would not exist.

[#5]

Thank you both, Bob and Ben.
How does one determine which 0845 numbers are free and which are not?  Or is it that it's only free during free (or averaged out pre paid taffifs such as the Anytime customers) and not selective by a given number? I guess the latter.
Again I find myself thinking of doing the right thing (back to the populist Amazon / Starbucks vogue news articles: Be the opposite) - I don't know what proportion of your customers are Anytime as opposed to, say, "Evening and Weekend" customers or the third call package so I can't gauge what proportion were free per package type yet I do understand your point that a significant portion of calls are not charged, I do not expect you to release such numbers (I am not fishing).
I am, of course,  pushing based on my ire at my friends situation with, I repeat, a different and, in my view, lesser company. Hence this advocacy. To charge for certain numbers (I'm thinking of those to Civil Service departments and other numbers where the users are predominantly in a state of financial hardship. Perhaps impractical to maintain such a list but wow, what a selling point.
I do not advocating abandoning of profit arbitrarily, rather that the company considers a cost benefit analysis based on the above against likely share marketing gain. And hey, be industry leading.
I should say at this point that I succumbed to the popular miss-belief that 0845 were free.  I can see looking at the BT tariff guide http://www.productsandservices.bt.com/consumer/consumerProducts/pdf/UKInternationalprices.pdf that they are local-call non geographic numbers. I am heartfeltly sorry and embarrassed by my foolishness and in the attempt to correct my initial question (topic text) to something a little less damning, I've edited the subject.
Back to my point...  during chargeable periods, that the cost per minute is 2.042p (BT)  vs 7.95p  - let's be honest, even taking into account costs of  fixed assets, wages, etc, that's a pretty impressive markup and one, as a customer, I am generally happy to pay (I pay for not just the product but also the service). Now, I know that PlusNet is not a charity but let's try a different suggestion - what if you charged at fully loaded cost for these 0845 numbers. It wouldn't give you such a catchy selling point yet it would still offer a significant selling point for the companies phone product.  You still gain the profit on the call setup fee.
@Ben, please don't think I am naive - I know PlusNet is not a charity. It's a company (finances used to be strong - not sure now you're owned by BT but I'd assume that you're still very profitable). However, PlusNet invest in charitable activities - just look at you're community roundup page - be proud of that. Why not consider extending this.
  So... throw this upwards as a suggestion - make non-geographic local calls not for profit rather than the >1xx% markup against the fully loaded cost and sell the fact.  We don't really need to discuss the above any further - I've done what I set out to and sown the seed (and wiped a little egg from my brow in the process).
One trailing point -  Where does the website say that 0800 numbers are free?
With thanks, once again, for your patience.
  Tom

[#6]

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How does one determine which 0845 numbers are free and which are not?  Or is it that it's only free during free (or averaged out pre paid taffifs such as the Anytime customers) and not selective by a given number? I guess the latter.

I maintain a list which is provided by BT - this makes an 0845 call chargeable. If the number is not in the list, it's free during your included minutes.

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To charge for certain numbers (I'm thinking of those to Civil Service departments and other numbers where the users are predominantly in a state of financial hardship. Perhaps impractical to maintain such a list but wow, what a selling point.

This would be a great selling point but extremely hard to maintain with a high degree of accuracy. This also needs to be paired off with the marketing message - how much time do you need to spend telling a potential customer that these calls are free? That time costs money whether it's a tv advert, newspaper, etc.

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I do not advocating abandoning of profit arbitrarily, rather that the company considers a cost benefit analysis based on the above against likely share marketing gain. And hey, be industry leading.

I've let the relevant people know, thanks!

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I should say at this point that I succumbed to the popular miss-belief that 0845 were free.  I can see looking at the BT tariff guide http://www.productsandservices.bt.com/consumer/consumerProducts/pdf/UKInternationalprices.pdf that they are local-call non geographic numbers. I am heartfeltly sorry and embarrassed by my foolishness and in the attempt to correct my initial question (topic text) to something a little less damning, I've edited the subject.

Don't worry, we're here to help!

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Back to my point...  during chargeable periods, that the cost per minute is 2.042p (BT)  vs 7.95p  - let's be honest, even taking into account costs of  fixed assets, wages, etc, that's a pretty impressive markup and one, as a customer, I am generally happy to pay (I pay for not just the product but also the service). Now, I know that PlusNet is not a charity but let's try a different suggestion - what if you charged at fully loaded cost for these 0845 numbers. It wouldn't give you such a catchy selling point yet it would still offer a significant selling point for the companies phone product.  You still gain the profit on the call setup fee.

The complexities of call rating are significant, please don't think it's as easy as the wholesale price list which is just a generic list. We do our best to keep prices low and after our recent refresh we're still one of the lowest in the market and certainly cheaper for your basic setup, geographic & mobile calls then every bigger provider. However, we still need to make a profit to support other products which our sold closer to the wholesale cost and others which are provided entirely free.

Quote

So... throw this upwards as a suggestion - make non-geographic local calls not for profit rather than the >1xx% markup against the fully loaded cost and sell the fact.  We don't really need to discuss the above any further - I've done what I set out to and sown the seed (and wiped a little egg from my brow in the process).

I've passed this in the right direction!

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One trailing point -  Where does the website say that 0800 numbers are free?

I don't actually know... I'll let you know if I find it!

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With thanks, once again, for your patience.

Any time!

[#7]

Thank you, Ben,
Open communication such as this is tantamount to maintaining strong customer's advocacy and PlusNet has a strong reputation. Although I asked some pointed questions, mixed with customer ignorance, I am both impressed by and grateful to you for taking the time to comment this.
I don't envy you or your colleagues for maintaining the model through which call ratings / charges are evaluated - having dug around this morning it became very apparent that the pricing model was impressively complex. With hindsight I'd have included complexity of behind-the-scenes pricing  when giving examples bridging  the base Wholesale ppm cost to the final PlusNet ppm cost (It's still an impressive difference, IMHO) .
Once again, Thank you and my apologies for all readers for turning this thread into a 1x1 discussion.

[#8]

No problem at all