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Last Updated: Wednesday, 19 May, 2004, 16:19 GMT 17:19 UK
Directory enquiries market boils over
By Ed Petter
BBC Money Programme

Almost a year after the deregulation of directory enquiries, there are calls for the telecoms regulator to step in and simplify the bewildering choice of numbers and charges that customers now face.

118 118 image
Users tend to forget all but the most advertised services

Early predictions that the market would consolidate to a handful of big players are proving wrong, with new providers still opening for business, raising the number of active 118 numbers to over 120.

The new companies range from the high profile 118 118, with its controversial advertising campaign featuring moustachioed 70s style runners, to tiny operators like Gay-Lo Directories, 118 453, which operates from a hut behind the reception area of a kennels near Windsor.

And despite, or perhaps because of, the rise in the number of providers, customers have deserted in droves.

Research by the 118 Tracker organisation suggests that the number of calls to directory enquiries has fallen by about half since deregulation.

Now Brian Cottle MP, Liberal Democrat trade and industry spokesperson, is calling on Ofcom, the regulator, to step in and simplify the system for customers by providing better information about the different services.

Lottery

A directory enquiries service has operated since the first telephone exchange was opened in 1879.

For almost 50 years, the number was 192.

Gay-Lo Directories
Gay-Lo Directories operates from a hut behind the reception area of a kennels

Until the end of the 1970's, operators would sit with over 50 phone books close at hand. A microfiche system was eventually introduced to carry the 20 million numbers. This in turn gave way to a computer system in 1984 when the modern 192 directory enquiry service was born.

But 192 was a monopoly, and three years ago, with the encouragement of the European Union, the then telecoms regulator Oftel decided Britain should change to a competitive directory enquiries market.

As in the rest of Europe, the new numbers would begin with 118. Companies entered a lottery to allocate numbers. The new world of 118 had dawned.

Wrong numbers

In the early days of the deregulated market, at the end of 2002, 118 services were beset by problems, with complaints about the quality of service. Although, by all accounts, the chances of getting the right number have since improved, it is still difficult to know what you are being charged, with calls from mobile networks sometimes costing double.

Another problem is that the majority of UK phone numbers are now either mobile numbers or ex-directory, and so aren't actually available to the 118 providers. The rise in the use of mobiles, which store numbers, and free internet searches for numbers, have provided callers with alternatives to calling 118.

Telephone
Early 118 services were beset by problems

Critics of deregulation say the market is not working because the public remembers the numbers which have been most heavily advertised, and they tend to be the more expensive services.

The Number 118 118, for instance has an initial charge of 49p with a per minute charge after that, compared with the 192 cost of 40p. The 118 providers argue that they are now giving better value for money. They are already offering new features such as the texting of numbers and call connection, and they say this is just the beginning.

Investment is being made in technology that will enable the caller to ask for a range of general information from cinema listings, to hotel star ratings, to where your nearest cash machine may be. The vision is to become general information providers, able to answer any number of everyday questions.

Ofcom, the regulator, is conducting research into the 118 industry, which it expects to complete in the coming weeks. Matt Peacock, Ofcom's Director of Communications promises that if their research reveals that the market is not working, they will step in to change the rules, and improve the service for customers.

Wrong Numbers is broadcast on Thursday 20 May at 1930 on BBC Two.


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