Freespirit1079 wrote on Oct 22^nd, 2011 at 9:30am:

I have never accused you of "making" money or receiving income. I have only referred to the subsidy (or benefit) designed into 084 numbers, irrespective of whether any revenue is paid directly or not. I more in depth explanation of this is below.

You stated quite clearly that you do not receive any payback for calls, and in fact that you contribute towards the cost of the service.

It is also important to understand that the receipt of benefit from 084 Business Rate numbers is by design and is not inhibited in any way because the user is not paid directly.

It is the case that your provider collects revenue from callers' telephone companies (around 3 or 4 pence per minute). This is as a result of your selection of a 0844 number. You simply allow it to retain this in return for the service, to which you make a direct contribution as well.

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Here is a more in-depth explanation:

It is important to remember that today's telecommunications network (as a whole) is made up of different providers. This is a crucial difference to the way it worked when there was only BT.

In the days of only BT, all calls were made from BT, charged to the caller by BT and delivered to the destination by BT. So, (as an example) at that time, you could say that callers paid the "local rate" to ring (if you had such a number). This is because there were different local and national rates. In fact, there was only one tariff!

Another example of how it worked back then: Callers paid 10 pence per minute to ring a particular company and 4 pence per minute to ring a local number. Thus, the premium above a local call was 6 pence per minute. It was easy to see and describe the affect of number selection on callers.


In today's multi-provider market, calls are often made from one provider to a customer of another provider. Thus, the cost of a call to one particular number differs between caller’s telcos (call providers) and even between tariffs.

A simple schematic of a call is as follows:

[Caller]----[Caller's telco]----[X]----[Receiver's telco]----[Receiver]


The Receiver's telco is that chosen by the Receiver. In your case it is BT.

Point [X] is where the two providers interconnect. It is the demarcation point between the Caller's and the Receiver's telephone service.

For calls to pass point [X], a toll must be paid. For a 0844 number this is up to about 5 pence per minute. Your 0844 number is a g11 which is roughly 4 pence per minute. Contrast this with a "normal" geographic call which is around 0.5 pence per minute. (Figures are rough and are given to illustrate a point of principle.)


Now consider this:-

1. From the point of view of the Caller and the Caller's telco:

The price that the Caller's telco sets (the retail call price) will likely reflect the cost of this toll. An 0844 number is a premium product with respect to a geographic call, so is likely to cost more to call.

It makes no sense to suggest that Caller's telcos will absorb the premium (the subsidy) as there is no benefit (to them) to do so. That would be like supermarkets permanently reducing the price of premium brand corn flakes to the price of their "no frills" corn flakes. The benefit would be for the customer (better corn flakes) and supermarkets would be likely to find that they sell far more premium brand corn flakes, which cost them more to stock.

Coming back to 0844 call charges, where the Caller's telco is BT it is only allowed to charge the toll. It cannot add on (much) for selling the product. Thus, its 0844 charges (but not geographic/03 charges) are very low and therefore the exception to the norm.

2. From the point of view of the Receiver and the Receiver's telco:

This is bit is important to the understanding of why getting no revenue does not reduce the subsidy received.

The Receiver's telco acts as the agent for the Receiver. It delivers calls to the Receiver and it is chosen by the Receiver.

For a call to a 0844 g6 number (not the same as that used by Spirit Adventures), the Receiver's telco collects 4 or 5 pence per minute. As the Receiver chose to use a 0844 number, it is thus responsible for this amount.

In some cases the Receiver's telco pays revenue and that comes out of this 4 or 5 pence per minute, with the remaining being retained by the Receiver's telco for provision of the service.


continued…

Freespirit1079 wrote on Oct 22^nd, 2011 at 3:40pm:

Sadly there's a lot of misinformation and misunderstanding about Business Rate 0844 numbers and telephone services in general. Apologies to anyone who finds my above explanation heavy going.

It's a common misconception that no revenue payments to you makes a number cost-neutral (i.e. its user derives no benefit).

I've made an extensive double-posting which explains the ins and outs. The "toll" I refer to is what I referred to as "subsidy" in the excerpt you quoted. I was in no way suggesting that you are paid directly.

From toll or subsidy come revenue payments, but turning off revenue payments (or not being offered them) doesn't lessen the toll.

I suggest that you look at moving to a cost-neutral 01, 02 or 03 number (I see your comment that you're doing it). Some suggestions that you might like to look at are in my next posting.

Dave wrote on Oct 22^nd, 2011 at 6:51pm:
I have tried a couple of indirect carriers, and my anecdotal evidence is that the 03 range is correctly understood by US systems, and charged at an identical rate to calls to geographic numbers. I have yet to attempt a direct call from AT&T, only because international rates are just too high unless one has a calling plan. But yes, so far, calls to 03 are treated exactly the same as calls to 01 and 02 for charging purposes.

By comparison, Google Voice rates for other calls are:

United Kingdom - NGN - 870      $0.18
United Kingdom - NGN - Local      $0.18
United Kingdom - NGN - National      $0.24

I would assume that 0844 is charged at 18c/minute.

idb wrote on Oct 22^nd, 2011 at 4:44pm:


Yes, I do take international orders. I had a geographical number for seven years and during that time I only had international calls from either fraudsters or sales people. All genuine international queries and sales have always been conducted over the internet. So please do not take my 0844 number as a lack of awareness or short sightedness in regards to international communications.

Freespirit1079 wrote on Oct 23^rd, 2011 at 3:57pm:

Thanks for the positive feedback on my explanation of how these numbers work. This is really the cause of why consumers are up in arms.

Consumers react with abhorrence at the extra cost (above the price of a geographic call) of calling companies and public services. They aren't particularly interested in the reasons why (as in my explanation).


At the end of last year Ofcom published proposals to make clearer the benefit that Business Rate number users enjoy. The idea is to split up the "toll" from the amount that the caller's provider charges. Of course, the former is the same for any receiver, but the latter differs between callers. At present, people just consider charges as a whole and number users often quote the atypical BT rates.

I hope that Ofcom goes through with this split pricing along with an explanation which should put pressure on users of Business Rate numbers to come off them if they do not wish to be seen to taking subsidies from their callers.

Freespirit1079 wrote on Nov 9^th, 2011 at 10:39pm:

Thanks for posting your new number.