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Slash Your Phone Bill - How To Find A Cheaper Plan

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Slash Your Phone Bill
You Can Save Big Bucks—Whether You’re Addicted To Your Cell Or Happy With Your Landline. How To Find A Cheaper Plan

November 1, 2004

By Jane Bryant Quinn

AT&T dropped a shocker on its customers last summer. Don't call us, it said, and we won't call you. The former Ma Bell is pulling back from home phone service to focus on business accounts and new telephone technologies. You can still sign up with AT&T, but it won't be investing in residential service or promoting its plans.

That's big news, even if you aren't with AT&T. Most cities will soon be left with only one major traditional phone company that wants your local business. That spells monopoly, which usually brings higher rates and fees even for long-distance service. If ever there were a time to reconsider your calling plan, it's now.

Your first move: Call your current provider or visit its Web site to see what new deals may be available. Then check what other companies are offering, especially the discount long-distance carriers.

Anyone on a "basic rate" long-distance plan (35 cents a minute during peak hours with AT&T) can almost always find something cheaper.

Be sure to compare all fees, taxes, and surcharges, not just the rate per minute. Fees are not only rising, they're also multiplying like rabbits. (The newest ones are a "regulatory assessment fee" and a "carrier cost recovery charge.") Also, compare costs for the hours you are most likely to call. By law, all costs and terms of service have to be disclosed on the company's Web site. But sometimes they're well hidden. You have to search deep to learn that collect calls via the company's popular 1-800-CALL-ATT plan cost $4.99 (up $1 this year) plus the per-minute charge. MCI, which has boosted fees across the board recently, also charges a $4.99 fee for its competing service, 1-800-COLLECT.


  • Chat by e-mail or instant message instead of over the phone.
  • Reconsider all the extra features that you're paying for. Do you really need call forwarding or three-way calling?
  • Cancel your regular long-distance service and use a prepaid phone card if you’re someone who rarely makes long-distance calls. Choose one with an attractive per-minute rate and no expiration date. Read the fine print to make sure a time limit doesn’t start once you’ve made your first call.
  • Look into the new “bundle” plans if you talk a lot and are using one of the big companies. These deals tie local and long-distance service together for a flat monthly rate in the $35-$50 range. The bundles ca include wireless and high-speed Internet calling and choice of features such as call-waiting, call forwarding, and three-way calling.
  • Check out discount long-distance carriers for the very cheapest service. Web sites such as and list low-cost plans from companies like Pioneer Telephone (one plan charges 3.5 cent per minute with a $15 monthly minimum).
  • Don’t pay for “inside wire maintenance” unless your home wiring is a mess. This rarely used coverage costs $3.50 to $4 per month.
  • Read the fine print on discount long-distant offers you get in the mail or over the Internet. Some plans charge flat rates no matter when you call. Others, such as one Verizon Plan, charge ten cents on the weekdays but just five cents a minute on weekends.
  • Choose a local service plan that gives you the lowest rate on the numbers you call the most.
  • Use free directory assistance on Web sites such as and Calls to 411 or other directory numbers usually cost $1 or more. If you let the operator connect you for “no extra fee,” you’ll pay the highest per minute rate.

Should you cut the cord?

Increasingly, phone users are going mobile and dropping their landlines entirely. (When did we start referring to regular telephones as “landlines”?) Careful users can save money With many wireless plans, you get a certain number of local and long-distance minutes for a flat fee ranging from $10 to $60 a month. Features such as voicemail, caller ID, call-waiting, call forwarding, and three-way calling are often included.

But there are downsides. Cell phones may not work in an electrical blackout. They can’t provide a conventional 911 service. (Unlike regular 911, the dispatcher can’t pinpoint your exact location, only that id the nearest cell tower.) You’ll run into “dead spots,” even in your house. Most important, any minutes you use that exceed the number you paid for are charged at a super-high rate, so you’ll need to track your usage carefully.

One strategy: Get a no-frills local line for emergency calls and for your computer’s online service. Use your wireless for the rest of your local and long-distance calls. And always read the fine print. The Better Business Bureau received more complaints about the wireless industry in 2002 than about any other type of business.

What’s the Future

New Technologies are coming down the pike that already make telephoning cheap, cheap, cheap. For example:

  • Voip (Voice over Internet protocol)

Users bypass the telephone company’s wires. Instead, your own phone is connected through an adapter into your high-speed Internet service, which carries the call. Cable companies such as Cablevision, Cox Communication, and Time Warner offer Voip using the wires already in your house. AT&T, Quest, and Verizon are also entering the market.

I tested the Voip service offered by a small, pioneering company called Vonage. A few glitches occurred while hitching up the phone on my cable modem. But once installed, the Internet phone worked fine. Packages of services run from a mere $14.99 to $29.99 a month. Other companies include iConectHere and Net2Phone.

  • Plug ‘n’ talk. Some utility companies are testing ways of offering broadband phone service through your home’s electric wires. You could plug your phone in to any outlet.
  • Free talk. The team that brought you the file-sharing program Ka Zaa is testing free Voip telephone software called Skype. You use your computer’s microphone to talk (free) to other people who are running the software. (To download the program, go to also offers free software for calling other members around the world.

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†AK and HI residents pay $29.95 shipping. ††Limited time offer. Valid for residents of the United States (&DC), 18 years or older, who open new accounts. Offer good while supplies last and only on new account activations. One kit per account/household. Offer cannot be combined with any other discounts, promotions or plans and is not applicable to past purchases. Good while supplies last. Allow up to 2 weeks for shipping. Other restrictions may apply.

1Unlimited calling and other services for all residential plans are based on normal residential, personal, non-commercial use. A combination of factors is used to determine abnormal use, including but not limited to: the number of unique numbers called, calls forwarded, minutes used and other factors. Subject to our Reasonable Use Policy and Terms of Service.

2Shipping and activation fees waived with 1-year agreement. An Early Termination Fee (with periodic pro-rated reductions) applies if service is terminated before the end of the first 12 months. Additional restrictions may apply. See Terms of Service for details.

HIGH SPEED INTERNET REQUIRED. †VALID FOR NEW LINES ONLY. RATES EXCLUDE INTERNET SERVICE, SURCHARGES, FEES AND TAXES. DEVICE MAY BE REFURBISHED. If you subscribe to plans with monthly minutes allotments, all call minutes placed from both from your home and registered ExtensionsTM phones will count toward your monthly minutes allotment. ExtensionsTM calls made from mobiles use airtime and may incur surcharges, depending on your mobile plan. Alarms, TTY and other systems may not be compatible. Vonage 911 service operates differently than traditional 911. See for details.

** Certain call types excluded. is not an official Vonage support website & is independently operated.
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