Verizon dials into long-distance market in Maine

BANGOR – Verizon entered the crowded long-distance service market Monday with a sales advantage over other long-distance providers – the company already has most of the state’s telephone users as local service customers.

Whether customers leave their current long-distance provider for Verizon, however, will depend on what they consider most important – the convenience of one bill and ease in dialing a telephone number or low rates, according to the state’s Office of the Public Advocate.

Customer comfort is what Verizon is promoting in its long-distance service advertisements and, according to spokesman Peter Reilly, with good reason. Verizon is the local phone company for 84 percent of the state, and Mainers like to have a telephone: According to national data, 98 percent of all households in Maine subscribe to telephone service, a percentage that is above just about every state in the country.

With so many products – wireless (in southern Maine only), Internet, local- and long-distance telephone service – Verizon’s pitch is that customers can buy all of them and get just one bill. It has set up several package plans that include some or all of its services with various rate options depending on how many calls are made.

“Verizon makes it easy with one bill and one call for customer service,” Reilly said.

The Maine Public Utilities Commission acknowledges that Verizon could have an advantage on name recognition alone over the dozens of other providers in the state.

“Verizon has a certain amount of inertia,” said Phil Lindley, spokesman for the Maine Public Utilities Commission. “People don’t like to change.”

But that convenience comes at a price, according to Wayne Jortner, an attorney with the public advocate’s office.

“They’ll do a lot of bragging about how much money they’re going to save customers,” he said. “But the fact remains they’re never the lowest-cost provider. Their basic rate is 10 cents a minute and that’s more than double the best rates.”

Verizon is promoting a package that includes local line rates, unlimited local calling, at least four “value-added services like call waiting and caller ID,” and enrollment in its Timeless long-distance plan, all for $35.73 a month. The Timeless plan charges 10 cents a minute for unlimited long distance and no monthly fee.

Verizon customers, though, currently pay between $15.13 and $18.69 a month for a local line and unlimited local calling, Jortner said, and Verizon “is doubling the basic rate on the assumption that you want all these other [value-added] services.”If they do, he said, “added up it’s a good discount.”

Verizon isn’t alone in offering more than one telephone service on one bill. Adelphia’s secondary product to cable services is state-to-state telephone calls, and the company discounts its toll rates if customers also buy digital cable and cable-access Internet service, said Shanna Allen, area marketing manager. Its toll rate is 8 cents a minute, she said.

“That’s quite a niche for them,” said Allen about Verizon being a monopoly phone-service provider. “Obviously this will be something we will be watching.”

USA Telecom, OneStar and 1Com sell local- and long-distance service in Verizon’s territory, Jortner said, and rates can be up to 12.5 percent lower than Verizon’s.

To counter Verizon’s entrance into the long-distance market, AT&T has taken out full-page ads in newspapers encouraging its customers to stay loyal to them. Last month, AT&T began offering “its loyal residential customers” 30 minutes of free domestic long-distance calling for a month. Customers, when they picked up the phone to make a call, heard a short message from AT&T that detailed the free 30-minute credit.

“We’ve found that our customers love being surprised in this innovative way with a reward that they can take advantage of so quickly and easily,” said Lou Delery, vice president of consumer long distance, in a statement. “When technology is combined with real value, customers win.”

Dozens of companies sell long-distance service in Maine, and to get some of the best rates from them, customers have to work at it when making a call, according to the public advocate’s office. The options include prepay plans, prepaid calling cards, dial-around service, and presubscribed calling plans.

“There’s one clear winner and there’s quite a few runners-up,” Jortner said. “Forget about the big names. [The best deal] is not with Verizon, it’s not with AT&T, it’s not Sprint and it’s not MCI.”

A few times each year, the public advocate’s office releases a guide to the best telephone service rates for local, long-distance, wireless and Internet. According to the guide, here are the best rates:

. Prepaid plans: The latest entrant into Maine’s market is OneSuite.Com, and it has the best overall rate at 2.9 cents per minute for U.S. calls. Customers pay ahead online with a credit or debit card for long-distance service, and dial access and account numbers before the telephone number. A customer’s OneSuite account can be used at any telephone, and a record of calls made can be accessed on the company’s Web site. Customers avoid taxes, and the plan does not include a dated expiration for unused minutes. It can be used for in-state and interstate toll calls.

. Prepaid calling cards: Sam’s Club/AT&T 600- and 1,000-minute cards have rates of 3.47 cents a minute. To buy cards, customers need to be Sam’s Club members. Additional minutes can be purchased over the phone. No record of calls is available. The cards can be used for in-state and interstate toll calls.

. Dial-around service: To use a dial-around service, customers dial 10-10-plus a three-digit number, then 1, the area code, and the number. The best plan is VarTec FiveLine, which charges 50 cents for the first 10 minutes, whether they’re all used or not, plus 5 cents for each additional minute. Can be used for in-state and interstate toll calls.

. Presubscribed calling plans: This form of long-distance service offers the ease of direct dialing the number without having to also dial account or access numbers. AT&T, MCI, Sprint and now Verizon are the most recognized dial-direct plans. Most companies send customers their own bills, but the tolls can be included on Verizon’s bill for a fee of $1.50 a month. The best rate is offered by Touchtone, at 4.9 cents for in-state toll calls and 5.2 cents per minute for interstate calls.

“The only problem is technically they’re not legal yet,” said Jortner, noting the PUC has not approved the company’s application yet. “[Touchtone] told me they’re going to be legal this month.”

To obtain a copy of the public advocate’s Ratewatcher Phone Guide, call 287-2445 or go to www.state.me.us/meopa.