The Early Show

Call Long Distance For Less

By CBSNews.com staff CBSNews.com staff

September 3, 1999 / 4:59 PM EDT / CBS

Talking on the phone long distance keeps getting more confusing. Last week, AT&T slashed its rates back to 7 cents a minute.

CBS Consumer Correspondent Herb Weisbaum explains who can benefit from the new rates.

People who sign up with AT&T will get that 7-cent-a-minute rate all day, everyday.

Sprint and MCI have new 5-cent-a-minute plans but that cheap rate is only good during off-peak time periods.

To get these cheaper rates, you must sign up for them and pay a fee. For AT&T's 7-cent rate there's a $5.95 monthly charge. Sprint and MCI also charge for their new lower-rate plans.

Are the lower rates worth it? It all depends on what type of caller you are. Clearly these rates are a bargain for anyone who makes a lot of long-distance calls and on the line for 200 minutes or more each month.

Average users, though, could see their bills rise, even with the lower per-minute rate, because of that fixed monthly fee. So for most people, a plan like this doesn't necessarily make sense.

Don't switch to a new calling plan without seeing if it works for you, according to the Telecommunications Research and Action Center, or TRAC, a Washington, D.C., consumer group. The rate you get may depend on where you call, at what time of day and on which day.

TRAC researchers just ran the numbers on AT&T's 7-cent-a-minute anytime rate. They say consider such a switch if you make a significant number of peak daytime calls - from 7 a.m. to 7 p.m. weekdays - and are a big long-distance user, spending $25 or more a month.

Many plans define peak time as from 7 a.m. to 7 p.m. The cheap rates used to be good before 9 a.m. and kick in again after 5 p.m.

You can't assume that anymore. Find out from your long-distance carrier when the rates go down.

According to the TRAC analysis, you might want to consider MCI's 5 Cents Plus plan if you only make a few peak daytime calls.

The TRAC Web site at www.trac.org has a Web pricer to compare rates from seven different long-distance companies. See which one best suits your needs based on where and when you call and how many long-distance calls you make.

Those who don't make a lot of long-distance calls might try some programs that don't charge monthly fees. Talk to your long-distance carrier to be sure you're on one of its special rate plans.

With the market so competitive these days, no one should pay full price for long-distance service anymore but many still do.

Don't assume your long-distance carrier will automatically provide the best deal. You have to request it. Call up and inquire, "For the way I use the phone, what's the best rate plan you have for me?"