More AT&T Rate/Fee Hikes

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February 24, 2004
As AT&T slashes jobs to trim expenses, it continues increasing fees paid by consumers. In March the nation's largest long-distance company is hitting customers with sharp increases in minimum usage charges, a co-billing fee and calling card charges.

Traditionally, long-distance billing had been included on consumers' local bills. Starting three years ago, the big carriers added "co-billing fees" for customers whose local service is provided by another company. AT&T's "Bill Statement Fee" goes up 66 percent next month, to $2.49 from $1.50 per bill. The fee is waived for users who accept a separate bill from AT&T.

Consumer advocate Rich Sayers notes, "MCI also charges $2.50 and Sprint or Qwest customers pay $1.50 for co-billing. But smart shoppers who want the convenience of one bill can find discount carriers offering lower rates and no billing fee." Sayers is the founder of consumer rate tracking sites including 10-10PhoneRates.com and Phone-bill-alert.com.

In addition to the co-billing rate hike, 15 different AT&T long-distance plans will have higher minimum usage charges beginning in March. Twelve plans that currently require between $2.95 and $5 minimum monthly usage will now require $7 minimum billing before taxes and fees. Three other AT&T services will have new $5 minimums.

"These changes, combined with other AT&T fees added over the last 12 months can really hit consumers hard," says Sayers. "There is the 99-cent regulatory assessment fee. Plus in seven states AT&T added new monthly connection fees of up to $1.95. "

Beginning March 7, consumers who use AT&T calling cards to make international phone calls may be subject to new "International Mobile Termination Charges. The charges apply to both prepaid calling cards sold in stores as well as subscriber calling cards.

When users call someone's land-line phone, they will continue to pay the regular card plan rates. However, if they call someone's mobile phone or other wireless device an additional rate per minute will apply. This can add as much as 27 cents more per minute.

"Mobile termination charges can be a big surprise to U.S. consumers who are used to a system where cell phone users pay for incoming calls," says Sayers. "In many other countries, the incoming caller pays a higher rate to connect to a mobile phone. Most U.S. phone companies are now recovering these costs from their customers."

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