Don't get duped by dial-arounds.

Swinging from one long-distance carrier to another could cost you

By now you've seen the advertisements claiming to reduce the amount you pay for long-distance calls. The process is simple. Just dial around your long-distance carrier by using a prefix such as 10-10-321 or 10-10-220. But do these codes offer any real savings?

Not necessarily, cautions Susan Grant, vice president of public policy for the National Consumers League, Washington, D.C. "The advertising for these services can be really misleading. Unless you're paying close attention to your bill, you may not even realize that you didn't save as much as you thought," she warns.

Last November Grant, along with other consumer advocates, attended a workshop that addressed dial-arounds. It was a joint effort by the Federal Trade Commission and the Federal Communications Commission to determine whether dial-around advertisements are misleading. "We had mock ads that were based on real ads and discussed the problems that we saw," explains Allen Hile, assistant director of the FTC's Marketing Practices Division.

"The dial-around area is particularly problematic because you don't get any other source of information before you make the call, so it's very important that these advertisements be a good source of nondeceptive information," he says.

Although many problems are cited in the print and television advertisements for dial-around services, the most pressing concern is that these promotions fail to highlight any disclosures or limitations that apply to the discounted rates. "The television advertisements are especially problematic because it's difficult to read the fine print on the screen. Plus, it's hard to concentrate on the disclosures when someone is verbally highlighting other things," Grant contends. For example, MCI's 10-10-220 ad says that all calls up to 20 minutes are only 99 cents and 7 cents per minute thereafter. That could be a good deal. But, what if you reach an answering machine? Leaving a one-minute message will also cost you 99 cents, and that's no bargain.

These plans don't emphasize the time of the day a rate applies or indicate whether there is a monthly service charge; some of these numbers do have them. They also fail to mention the cost of international calls. As a result, consumers are often unaware that higher rates or service charges may kick in. To avoid this confusion, Grant says, "all of the information in the ad should be communicated the same way."

Dial-around advertisements also make it difficult for consumers to determine who they should call to ask questions or express concerns, according to an alert distributed by the Federal Consumer Information Center, Pueblo, Colorado (www.pueblo.gsa.gov). Although the promotions don't tell you who sponsors these services, three of the most popular dial-around codes are owned by major long-distance carriers. MCI WorldCom (under Telecom USA; 800-866-3311), for example, owns 10-10-321 and 10-10-220. Another dial-around, 10-10-345, is owned by AT&T (800-COMPARE). Thus, you're not actually dialing around the well-known long-distance carriers by using these codes.

The complaints surrounding dial-arounds are growing. Michael Balmoris, an FCC spokesperson, says that from January 1998 to June 1999, the FCC received 2,919 marketing/advertising-related complaints on this issue. Although Balmoris wouldn't identify any specific companies under investigation, the Consumer Information Center alert cites MCI's dial-around services as top offenders.

If you make few long-distance calls, you may save money by dropping your long-distance carrier and using dial-around codes. However, you still need to make sure you understand the terms and restrictions of the service you use. You should also get answers to several questions before you make a call. Is the rate for the dial-around cheaper than what you're paying currently? Does the dial-around have any monthly fees? Are there any fees in addition to the per-minute charge? Are there minimum per-call or per-month charges? Does this discount rate match your calling habits?

Grant says the key is to get satisfactory responses to your questions before you try the service or "take your business elsewhere."

Compare Carriers

www.abelltoll.com--Offers a free newsletter and charts comparing the rates of long-distance services.

www.consumer-action.org--Under the site's 10-10 phone rate survey, two charts outline domestic and international fees for various dial-around services.

www.trac.org--Need directory assistance or an area code? You'll find them here. It also features information on how to save money on your phone bill.

Monique R. Brown E-mail: [e-mail]