Watchdog hails 118 improvements

118 118 was notable for its high profile ad campaigns

The new 118 directory enquiries firms are improving their service and succeeding in driving down prices, a report for watchdog Ofcom has claimed.

But critics have noted that only half of the top 30 providers charge less than the minimum cost of the monopoly service run by BT.

In addition, the number of people using the new services has dropped.

One directory provider, 192.com, delivered a scathing review of the report, dubbing it a "whitewash".

The report's findings

For the study, Ofcom made 5,880 "mystery shopping" request calls to the UK's top 30 providers - who make up 95% of the market.

OFCOM REPORT FINDINGS* 87% of numbers given correctly 99% calls answered first time Calls answered within an average of eight seconds Typical call duration less than one minute Half charge less than 40p - cheapest rate 27p, most expensive 65p *SOURCE: Results of 5,880 calls made to top 30 118 providers

The watchdog found three in 10 consumers had now selected a 118 service to suit their needs - and of these 64% said they were satisfied with that provider.

The Ofcom report also found that the accuracy of the services had improved, with 87% of calls generating accurate numbers compared with just 67% last year.

However, the report also revealed that a quarter of people are calling 118 numbers less frequently now - compared with just 1% who were using the services more.

CUSTOMER VIEWS OF 118* 85% aware of changeover from 192 to 118 57% of adults use 118 numbers 9% have stopped using 118 altogether 25% of users calling 118 numbers less frequently 1% using service more 30% have selected a number to suit their needs - of those 64% are happy with the service 60% aware of differing prices between providers 47% believe 118 charges are higher than the former 192 service *SOURCE: NOP poll for Ofcom and Icstis

And 9% of people questioned said they had given up on the service completely, with the biggest turn-off being higher costs or the perception of higher charges as well as complaints about poor service.

The fact that the majority of people are only able to name one provider may also suggest that opening up the directory market has failed to stimulate competition.

And critics have also argued that the success of some 118 firms is only due to very expensive advertising campaigns.

As the new services were being launched in August last year, new companies seized the chance to grab a slice of a potentially lucrative market, spending millions of pounds on a marketing campaign to the monopoly once enjoyed by BT.

'Whitewash'

The report's findings prompted Ofcom to conclude it would not interfere with the new market.

"Immediate regulatory intervention ... in this important young market would be premature and disproportionate," it said.

While the market - which currently numbers at least 120 directory providers - continues to mature, the regulator said it would "continue to monitor development closely".

Directory provider One.Tel welcomed the report saying: "Consumers are generally experiencing better levels of service, but price remains an issue."

But fellow 118 provider 192.com rubbished the findings, calling the report a "whitewash on a shambolic deregulation process".

The group argued that as a result of deregulation consumers are now faced with a plethora of directory services and tariff structures which "feed public perception of higher costs and poor service".

"Worse still this supposedly competitive market has come to be dominated by two players," chief executive Alastair Crawford said.

He added that the report "glossed over" the fact that the two providers "are both more expensive than prior to de-regulation".