Are £5 per minute phone calls viable? – ICSTIS consults

The consultation was launched by ICSTIS - the Independent Committee for the Supervision of Standards of Telephone Information Services - in June this year and seeks to establish whether there is a market for a service that would give consumers access to professional advice over the telephone, and how consumers could be protected against the high bills that would inevitably follow.

In the more usual type of premium rate service consumers can obtain entertainment or information over their phone, mobile or fax, for a maximum of £1.50 per minute. The amount charged to the consumer is then shared between the telephone company and the business providing the information or entertainment.

The industry is looking to expand the services it offers, but is finding itself restricted by the restricted call charge. A £1.50 per minute charge will not cover the costs of legal or accountancy advice, but a higher charge creates risks of very high bills for the consumer.

ICSTIS is therefore looking to strike a balance between encouraging industry innovation and offering consumers adequate protection.

ICSTIS has proposed that the new tariffs be introduced in a controlled trial in which service providers could only offer the higher rate service if they had obtained prior permission from the regulator. This would allow ICSTIS to assess the proposals and impose conditions on the operations of the service.

These conditions could include:

• A maximum charge of £75;
• Automatic disconnection once the maximum charge has been reached;
• A free introductory message warning of the high charges; and
• Cumulative cost warnings throughout the call.

The consultation document proposes that the new tariff is only offered to professional services, such as veterinary, legal or medical practices - and only if they do not target vulnerable users.

The services will not include "entertainment services (including all types of live chat and competitions), counselling services, consumer credit services and children's' services."

ICSTIS also suggests that services that allow for the purchase of products, which are then charged through the purchaser's telephone bill are not to be included in the trial.

Responses to the consultation must reach ICSTIS by 1st September this year.