Like all technical industries, telecoms has a language of its own and it also has many tricks of the trade that can sucker business owners into making expensive mistakes.
So what should you look out for? Dave Millett of independent telecoms consultancy Equinox has some advice:
1) Capped call prices (a bit like 'all you can eat' restaurants) appear to be a great deal but these deals usually have a high minimum charge, so unless your average call duration is three to four times the national average it's likely to cost you more than conventional call charges.
2) The bundled calls offer, such as 500 landline minutes for £5 per user. This is only a good deal if you make close to 500 minutes of calls every month of the year – including summer holidays and Christmas. Not using all the minutes can dramatically raise the actual cost of each call.
It is therefore essential to undertake a detailed analysis of your invoices to see on which calls these special deals will actually be of benefit. One client saved over £3,000 per annum by moving back to paying for actual calls. This equated to 50% of their bill.
3) The advertised price is not always what you end up paying: it is often only the beginning.
With landlines in particular, call tariffs often look very attractive when advertised. However behind the cheap tariffs lurk hidden dangers. So always ask the following questions and get the answers in writing:
i) Are call charges billed per second or per minute? The latter can add up to 20% to your bill.
ii) To how many decimal places are calls billed or are they rounded up? Again the latter could increase the bill by 10%.
iii) Get a full list of all call prices. Cheap calls to UK landlines and mobiles may be offset by higher prices to 0844, 0845 and 0870 numbers and to international destinations.
iv) Initial discounts on line rentals need to be offset by the full price and find out how long the discount lasts. Calculate the average price over the contract life.
v) Watch out for longer term deals whereby line rentals are cheaper or free with fixed call prices for the period. Unlike interest rates call costs generally fall. For example about three years ago the average cost of calling a mobile was often over 10p now it is around half that.
vi). How long is the contract for? A favourite trick is to leave the minimum term option box blank, with small print saying 'if blank the contract is deemed to be 60 months'. Watch out for this and never lock yourself in long term.
vii) What is the notice period? If you employ less than 10 people then automatic rollover contracts are illegal.
viii) How are penalties calculated if you do cancel? Watch out for any that want to charge remaining rentals and for calls you 'would' have made. This breaches Ofcom guidance.
ix) Have you got a full set of terms and conditions? You should have but some companies just refer you to their website which means they can change and you are not aware.
A little effort can save a lot of pain later. Equinox has published a complete free guide for business users called 'The 7 Deadly Sins of Telecoms' which contains details of other tricks of the trade which everyone should be aware of: http://www.equinoxcomms.co.uk/blog/