Firms paying 'unnecessary' phone fees

Small businesses may be paying BT nearly £100m each year for services they do not use, a broadband expert has charged.

BT currently takes in just over £95m a year in line rental charges from small businesses, but even if a company uses an alternative phone company and broadband provider, the telecom giant can still claim a quarterly line rental charge of £41.15, says Kerry Ritz, managing director of Vonage.

"In the UK if you subscribe to a broadband connection, nine times out of 10 it is coming on a BT line," Ritz told MyBusiness.co.uk.

As a formerly nationalised company, BT owns the rights to most of the UK's telephone lines and firms must pay a rental fee for those lines.

But these often unnecessary charges can burden a business with costs of over £120 each year, Ritz claimed.

"You have to have a BT line and you pay a line rental for that, then you pay a broadband subscription, but you don't have the choice to separate the subscription from the BT line.

"BT does not want to lose that telephone subscription."

Ritz pointed out that in the US, the Federal Communications Commission (FCC) recently ruled that the large telecom companies must offer what the industry calls 'naked DSL'.

In other words, conglomerates such as Verizon and Qwest must give their customers the option of separating their broadband subscriptions from their telephone lines.

Ritz said industry leaders have been working with telecoms watchdog Ofcom to push a similar mandate in this country, but the issue has yet to crack the top of their priority list. However, he claimed it is only a matter of time before the current shift to IP telephony heightens awareness of the issue.