Discount Long Distance Service

How to analyze your Phone Bill to find the Lowest Cost Long Distance

Here's a No-Nonsense explanation of the cost of long distance service and how to find discount programs that fit your need. 

Your long distance bill, whether you are a residential customer or a business customer, is a direct function of your calling pattern. There are several key variables that are calculated and each can vary significantly from carrier to carrier. These variables are:

Unit Cost Per Minute - typically stated as fractional cents per minute
Interstate Rate - State to State Unit, stated as Cost Per Minute
Intrastate Rate - Calls made within your State, stated as Unit Cost Per Minute
Intralata Rate - Calls made within your Area Code that are considered long distance calls, stated as Unit Cost Per Minute
International Rate - Calls made to another Country, stated as Unit Cost Per Minute
Monthly Fee for Service - All programs charge a recurring fixed rate per month on top of your call charges
Monthly Minimum Fee - Some programs discount the Unit Cost Per Minute but for the lower rate, require a minimum monthly charge
Directory Assistance Rate - The charge incurred when you dial with assistance
Toll Free Rate - The charge for an incoming call if you have toll free inbound service, stated as Unit Cost Per Minute

When studying your long distance bill, you should be able to determine all these variables. Your bill should show clearly the amount of minutes used and the corresponding fees charged on Interstate, Intrastate, Intralata, International and Toll Free calling. Also, the Monthly Fee for Service should be displayed. If your total fees fall below the Monthly Minimum Fee, that should be shown as well. However, it is not uncommon for telecom carriers to hide or disguise the variables; a sure indication that the charges are unreasonable.

The first step in comparison shopping for long distance is to determine these fees and understand if the bill you are looking at is normal for you. If it is, you are ready to compare apples to apples. Study the following example and you will see what to shop for.

  # Calls # Minutes Total Charge Unit Cost Comment
Interstate 100 100 10.00 .10 / minute  
Intrastate 200 300 36.00 .12 / minute Highest Use Item
Intralata 20 30 6.00 .20 / minute Low Use Item
International 5 20 5.00 .25 / minute Highest Unit Cost
Toll Free 25 30 4.50 .15 / minute  
Directory Assistance 3   3.00 1.00 / call Low Use Item
Minimum Mo Fee 10.00   10.00    
Total   480 74.50    

Look for the dominant charges. When comparing services, understand what would happen under different billing programs:

Program A offers a higher Interstate fee of 12 cents per minute but has no Minimum Monthly Fee. The result would be an extra $2 in Interstate charges but a reduction of $10 in Monthly Fees, netting a savings of $8 or 10%
Program B offers a lower fee for Directory Assistance of 50 cents a call but a higher Intrastate fee of 13 cents per minute. The result would be $1.50 off the Directory Assistance Fee but an increase of $3 in Intrastate fees, resulting in an increase of $1.50 on the total bill.
Program C offers a 7 cent a minute Intrastate rate but has a $25 minimum fee. The result would be lowering the Intrastate charge by $15 bringing the total bill to $59.50 but the $25 minimum would be a factor so you would save 20%.

The comparisons could be endless, but the easiest scenario is to look at the line item that you are paying the most total dollars for and seek out an alternative with the least unit cost for that item. Also understand if you make many calls under a minute in duration and look for your billing increment - it may be as low as 6 seconds or as high as full minute increments. Then look at what the new program would charge for all the other variables and determine the difference. 

Our Experts have assembled a series of choices for you to self-evaluate your bills and make an informed decision. Analyze them for yourself then, if you are interested, order your new service online. We hope our information has been helpful and that you are able to find a less costly alternative. 

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