In what could develop into a price war in UK telephony, Mercury Communications Ltd yesterday announced that from January 1 it would improve the discounts on its frequent caller programmes and British Telecommunications Plc immediately responded by saying it is to freeze the cost of all direct-dialled internal and international calls for 12 months. The sting in the tail is that line rentals will rise by an average of 10 pence a week for both business and residential customers. It also plans incentives for residential customers to make more use of their phones including more discount schemes and some reductions in international call charges. Under Mercury’s scheme, residential and single-line business customers will get a 5% additional savings under the frequent caller plans, is on top of the savings already available to Mercury customers during the cheap rate period. Mercury is also offering business users four new schemes designed to offer significant savings to customers using Mercury over their British Telecom exchange lines as well as customers with a direct link into Mercury. For a UKP5 quarterly fee, the frequent caller plan gives bigger discounts on their bills to subscribers spending UKP35 a quarter and up on long distance or international calls.
