BT to raise directory inquiries charges by 60%

Callers to BT's directory inquiries service will see a 60 per cent increase in charges from tomorrow with the introduction of new tariffs for its 118 500 service.

The telecommunications operator is raising its connection fee for calling the number from 25p to 40p. It is the third operator to increase some of its rates following the deregulation of the market in August last year.

The higher price is thought to have been introduced to compensate for a drop in the number of people using directory inquiries. Industry executives blame a greater public awareness of the cost of using the service since its deregulation for the fall in demand.

Estimates suggest that since the old 192 service was switched off, the number of calls to directory inquiries has plummeted by about 40 per cent.

Over the past few months BT, which used to have a monopoly in the market, has lost its pole position to The Number, which runs the 118 118 service.

A series of popular advertisements featuring Seventies-style

runners with the logos 118 118 on their vests helped customers memorise the number, putting the operator ahead of its competitors.

Other operators providing directory inquiries services, of which there are more than 20, have also increased their tariffs in recent months.

Last November Conduit, which runs the 118 888 service, raised its rates after initial advertising campaigns claimed it was half the cost of BT.

Low-cost entrant Directory Enquiries UK also raised its rates earlier this year.

BT said it was introducing the new tariffs because more customers were making use of "call connect" services that connect them to their chosen number which was making call durations longer.

The operator claims many of its users will see cheaper services under the tariff changes - alongside the higher connection charge the company has halved its per-minute charge on a directory inquiries call to 15p a minute.

BT says the average call lengths are approaching one minute. Based on this longer call duration, the typical user will pay about 55p for a call to directory inquiries, comprising 40p connection fee for the call and 15p for the length of the call, which would be no higher than before.

But the company has previously claimed its average call duration was only 28 seconds and based on this shorter call duration, users would pay around 47p a call under the new tariffs whereas before they would have paid 40p.

Charges currently range from around 29p a call to 65p or more per minute among the various directory inquiries operators.

Some operators, such as The Number, are introducing new services such as "find my nearest" which will locate the nearest pubs and restaurants.

However, a few of the smaller entrants to the market, such as Directory Enquiries UK which is now on sale, have struggled to reach the call volumes necessary to cover costs.