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118 The Most Expensive UK Phone Numbers, How Much?

118 The Most Expensive UK Phone Numbers, How Much?

Over recent years there have been some significant changes to the Directory Enquiry (DQ) sector of the phone-paid services market. The availability of alternatives to DQ services including smartphones and other devices where customers can search the internet for company contact details has caused a decline in DQ sector revenues. During this period of decline the average call cost of DQ calls has risen significantly.

In the past when DQ services were at a high point advertising was distinctive so consumers were more familiar with how much these services cost to call. Since the decline in the DQ marketplace providers with already established brands have reduced promotions. This reduction in promotions has increased the likelihood of consumers not being familiar with clear and up to date pricing information and therefore being charged at a higher rate than expected.

The PSA have received a large number of complaints in relation to consumers being charged excessive amounts when dialling a DQ service.

In May 2017 Ofcom the telecoms industry regulator decided to review the DQ sector and sought assistance from the PSA. The PSA’s review revealed two major issues supported as relevant by research Ofcom has undertaken during its review and by our investigations into complaints about specific DQ services. 

History of the Directory Service Sector

  • In August 2003 competition in the directory enquiry services was introduced which enabled new providers to compete with existing services operating on two numbers provided by BT 192 for domestic DQ and 153 for International DQ.

  • There are approximately 213 numbers in active use within the 118x number range and 86 providers as of the publication of this blog. Over 90% of the DQ market share (by revenue) is currently held by only a small subset of providers. The two numbers with the largest share of revenue are operated by The Number UK Ltd (118118) and BT (118500).
  • Other numbers are provided by Enable Media (118606) Yell (118247) and by Maureen (118212) followed by various ‘in-house’ services offered by mobile phone or landline networks to primarily their own customers.
  • In the Annual Market Review (AMR) commissioned by the PSA, revenue spend is tracked over time for different sectors. The DQ market size measured by revenue shows the following:

  • £108.8m in 2014/15
  • £82.72m in 2015/16
  • £65m in 2016/17

  • Through 2016/17 DQ Services have held 9% of the overall phone-paid market share, which is a decline of 21.4% from the previous year in revenue terms.
  • This trend in decline reflects the more general decline in the use of voice services and is also likely influenced by the rise in smartphone use which allows consumers to access number contact details via the Internet.
  • The overall size of the DQ sector has reduced over time for most if not all the cost of calling DQ service has risen.  An example of the cost of calling DQ service in 2003 - it was 30p connection charge and 9p per minute and the current charge for the exact same service is now £8.98 connection plus £4.49 per minute.
  • In 2016 a set of 100 available service charge points were released for all ‘voice-based’ phone-paid services.

  • DQ services were allocated a specific set of price points higher than the cap imposed by other service types with the maximum price point for DQ being £15.98 upon connection and £7.99 per minute thereafter.

  • The majority of providers charge in the range of between 50p and £4.49 per minute. BT have announced that it would reduce the price of 118 500 service to 77p per call plus £1.55 per minute from 1 June 2018.

The areas highlighted from the investigations were:

  • A lack of consumer awareness of the cost to call a DQ Service and the cost of being connected to the number requested.

  • The use of techniques designed to mislead and persuade consumers into calling DQ numbers.

As a result of these findings two new special conditions will apply to DQ services:

  • DQ services promoted using Interactive Voice Response (IVR) messages or other means on geographic numbers only use numbers that are active and already in use for purposes other than such promotions.

  • DQ services provide the consumer with the cost of any onward connection giving them reasonable time to consider and decline before any connection occurs.

 

These new conditions are intended to complement proposals from Ofcom from its review published on 13th June 2018.

 

If you would like to talk to one of our team to get any point clarifying please do not hesitate to contact us. Call us now on 0800 692 7000 or email new@08uk.co.uk so we can call you back.

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