Beware 3rd-party pay phones

Sylvia Porter

January 07, 1991|By Sylvia Porter | Sylvia Porter,1989 Los Angeles Times Syndicate, Times Mirror Square, Los Angeles, Calif. 90053

One of the less-welcome surprises to result from the phone company breakup is proliferating at an astounding rate.

Unless you read your phone bill closely, you may not have noticed it. Or perhaps you did notice it: a listing for a charge of a few dollars, made by a telephone company you've never heard of. Upon closer inspection, you discover that this charge is for a local call of a minute or two!

You have become the customer (probably unwitting) of a third-party telephone company.

These small independent phone companies were made possible by the breakup of AT&T. Initially, they chiefly contracted to provide telephone service for hotels and motels. Many customers become irate who, when checking out, learn that a few local calls cost many dollars -- or that they have to fork over a few dollars even though a call was made collect or charged to a phone credit card.

The problem was well publicized and, even though it still exists, it has been brought under some control by market pressures: innkeepers have learned it is not good business to send lodgers away angry. And there is little that will make a customer see red as quickly as a surprise bill of $5 or more for a local call.

But the independent telephone companies were undaunted. They found fertile new pastures in the credit card pay phone market.

"I got my phone bill," said an acquaintance a few weeks ago, "and there was a $3 charge on it for a one-minute local call. I couldn't believe it. I called the phone company and they said I had made a credit card call from a third-party company. They removed the charge from my bill, but said this was a one-time thing. They said to be careful after this."

Two weeks later, a different friend had a similar story.

"I made two phone calls, just local ones, from a credit card phone -- the regular pay phones were already in use," he said. "When my bill arrived, there they were -- $8 each."

The second friend also called the phone company -- meaning the main carrier for the region -- and the charges were removed. But again, there was a warning to be more careful in choosing pay phones.

The fact is that pretty much anybody can go into the telephone company business nowadays and, if the company limits its operation to one state, can charge about what it wants -- without warning.

"Unless they're in interstate business, they aren't under our control," said a Federal Communications Commission spokesman. "Nor are they covered by the usual telephone company tariffs."

A check of a few state consumer protection offices revealed none in a position to regulate telephone companies. In short -- you're on your own.

There are some private, third-party telephone services that operate in a reputable way, giving good service for a reasonable price. But there are others -- the ones described here -- that charge whatever they can get away with. And they can get away with a lot, because you don't know what you're paying until long after you owe it.

In due course, no doubt, the market will force the price gougers to reduce their rates -- or states will begin regulating them, forcing their prices down and, perhaps, some out of business. The bitter irony is that those who operate responsibly are those whose profit margin is narrow enough that regulation could put them out of business.

But, again, for now you're on your own. What can you do?

* Always check your phone bill carefully. But it's fairly easy to pick out things that shouldn't be there. Don't be shy about calling the telephone company if you have questions.

* Be hesitant to make credit card calls, especially local ones, from pay phones. If you pay cash, you will find out immediately what you are being charged -- which will often be much, much less.

* If you must charge a call from a pay phone, look at the phone carefully. Most have the name of the company somewhere, albeit often in fine print. Try to find one that's hooked into the main phone carrier for the area.

Baltimore Sun Articles
Please note the green-lined linked article text has been applied commercially without any involvement from our newsroom editors, reporters or any other editorial staff.