Taking Advantage of Options Can Slash Telephone Bills, Study Shows

Despite increases in local telephone rates since the breakup of the Bell System two years ago, those residential customers in the Southland who have bought their own phones and switched from AT&T;’s long-distance service to a less costly alternative have trimmed their overall phone costs.

That conclusion emerges from a nationwide consumer survey conducted in 18 cities, including Los Angeles, by the National Strategies & Marketing Group in Washington.

“The average Los Angeles consumer who takes advantage of the new competitive options already available is paying 2% to 18% less per month for telephone service than before the Bell breakup,” says David K. Aylward, managing partner of the research firm. But, he added: “Millions of Americans still haven’t made the simple choices which can significantly reduce their monthly telephone bills.”

Southland residential customers of Pacific Bell and General Telephone who have bought their formerly rented phones and take advantage of available lower-cost long-distance services are paying 11% to 20% less than those who did not, the study found.

The study also reports that the basic monthly service charges that the California Public Utilities Commission have authorized for Pacific and General to collect from their residential customers in the state are among the nation’s lowest: Pacific Bell’s current basic $8.25 charge for local service is about 60% below the national average; General’s $9.75 is 26% less.

Nationally, local telephone rates increased 24% since 1983, according to the study, but more than half of that increase was offset by long-distance rates offered by AT&T;’s competitors that average 17% less than AT&T;’s, and even AT&T;’s rates have dropped 9%.

“The widespread assumption that consumers have been losers in the restructuring of the telephone industry because of large local telephone rate increases is simply not supported by the evidence,” Aylward says. But to realize the benefits, he added, phone customers have to begin taking advantage of the new pricing options open to them.

“Millions of Americans haven’t made these simple choices, and they are paying the price--up to 25% more per month than families who have taken advantage of competition,” according to Aylward.