Ofcom set to introduce price cap on 070 numbers
Communications watchdog Ofcom has vowed to put a cap on "rip-off" 070 numbers which can cost consumers as much as £1.50 per minute.
Often mistaken for far cheaper mobile phone numbers which also begin with 07, Ofcom has revealed that approximately 2.6 million phone calls were made to 070 numbers between April 2017 and March 2018.
The numbers are often used as a 'follow me' service where calls are diverted from one number to another, allowing the person being called to keep their number private. They're also used in hospitals for relatives to call patients at their bedside.
To take effect in just over a year, the regulator is proposing a 0.5p/min limit on the price providers pay for such calls and it's confident that they will pass on the saving to those calling the numbers. The cap will work similarly to the one brought in for mobile phone calls. Prior to that, consumers could be charged heavily for using their mobile phone to call others on another network.
Ofcom's consultation, which closed in February, highlighted that the high costs some providers charged had caused these numbers to appear untrustworthy. The draft statement has now been sent to the European Commission, which is expected to approve the changes. The Commission will submit its response to Ofcom within 30 days and the regulator is expecting to publish its final statement a month after that. The cap will then be in place a year later, allowing providers enough time to make any necessary changes.
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How do 070 numbers work?
When someone calls an 070 number, their communications provider pays a wholesale termination charge to the service provider for the call to reach the recipient. The caller is then charged a retail price by their service provider, this could range from 45p to £1.50 per minute.
Hospital communication and entertainment unit provider Hospedia, which supplies almost all of the UK's hospitals, uses 070 numbers for bedside telephones. Usually, while patients aren't charged to make outgoing calls, relatives are charged as much as 50p per minute for an incoming call.
Furthermore, up to 20% of calls made to 070 numbers were considered to involve fraudulent activity as the high termination rates serve as an incentive for a range of scams. A cap would help to disincentivise some of this behaviour. Some of the most common types are:
Service provider fraud. These include missed call scams where someone may return a missed call from an 070 number or fake job adverts with an 070 contact number.
International artificial inflation of traffic. 070 providers or those who have an agreement to benefit from the termination charge can organise for large numbers of calls to be placed from countries whose telephone companies don't recognise the difference between 070 and 07 UK mobile numbers. This can mean that the provider charges the scammer the lower 07 rate rather than passing on the much higher 070 termination rate the provider will have to pay.
Identity-related fraud. Service providers don't usually recover any of the termination charge from the recipient of the calls, ie, their own customers, this means they don't know their identity. This leaves 070 numbers open to criminal activity with recipients' identities being concealed.
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How much do consumers currently pay?
Since Ofcom's intervention in 1998, wholesale costs have fallen from 13p/min to 0.5p/min which has resulted in networks incorporating calls into fixed monthly costs or minute bundles, this is also expected to happen to 070 numbers.
070 numbers can cost between 49p and £83 per minute if calling from a landline (and often include a call set-up fee, sometimes of up to 51p). From a mobile phone, these numbers can cost between 45p and £1.50 per minute. Here's what some of the bigger providers charge at the moment:
What does Ofcom say?
An Ofcom spokesperson said: "These numbers are often mistaken for mobile numbers, but it's important for people to know they generally cost a lot more to call. Those charges can lead to people receiving much higher bills than expected. So we've set out plans to address this by cutting the cost of calling 070 numbers."
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