Facts About The Premium Rate Telephone Services

As with so many novel concepts, the Premium Rate Services originated in the United States in 1983. In 1985, with the privatisation of British Telecom, these services were introduced to the United Kingdom.

With the advent of privatisation it was generally accepted that the British telecommunications industry would offer new and exciting ways for enterprising
businessmen to profit. Of all the new concepts introduced, Premium Rate Services have proved to be the most rewarding.

Growth In Demand
In the U.S.A., where they have had a few years head start, the growth in demand for these services has been quite phenomenal. From a zero start in 1983, the Wall Street Journal states that income for the current year will exceed $4 BILLION - OVER TEN MILLION DOLLARS A DAY!

In the U.K. the demand for these services has been no less spectacular. Since inception, the demand has grown dramatically. An estimated 320 million calls, roughly 640 million call minutes, were made to premium rate services in 2007, generating a revenue of over £280 million pounds.

The Friendly Telephone
Today almost every U.K. home has a telephone. The phone is the one piece of modern communications technology which everyone is happy to use. And we can all benefit from access to information and entertainment that helps to make our lives more convenient, productive and enjoyable.

Instant information is what everyone demands today. The telephone provides the fastest and most convenient means for us to obtain it. As a method of providing information and entertainment to the public. This is reflected in the use by major companies, the media, and even the government, of the telephone as a means of providing a vast array of information and marketing services to both businesses and the general public.

Easy Access On The Phone
Do these new telephone services make our lives more convenient? Certainly they do! Everyone takes the easy option. For years people have insisted on ringing “directory enquires” - even though the same information can be found in the telephone directory. Today the telephone companies charge for directory services, and customers are quite happy to pay.

“TALKING PAGES” are replacing the “Yellow Pages” in popularity with the public. The publishers have recognised the need to provide easy telephone access to their information. For this reason “TALKING PAGES” have been introduced  in most areas of the U.K. Now by dialling the Talking Pages, you can get the same information over the phone. The public is happy to pay for telephone services which gives them the
information they need easily and instantly. AND NOTHING IS EASIER THAN THE PHONE.

Valuable Information
New services are being launched every day to feed an information hungry society. Selling information over the phone is an explosive industry. Many entrepreneurs and established companies are discovering how to market and sell information they once gave away free.

Many businesses have realised that they are sitting on a valuable asset - INFORMATION. And by packaging their information into simple telephone services, they can make a substantial extra income, by offering their information to the public over the phone.

Just a few examples of information which was previously offered free and is now
being charged for over the phone:

• Stock market analysts who collect data have valuable information to sell to investors. They offer up to the minute shares tips on recorded services and live consultations over the phone.
• Estate agents have discovered that the public will gladly pay for information over the phone that they could pick up free from any local estate agency.
• Restaurant, cinema, theatre, radio and television critics can now sell their views and recommendations over the telephone.
• Weather forecasters, lawyers, doctors, travel agents, sports enthusiasts, are all currently selling information or advice to the public down the phone!
• Newspapers charge for local weather forecasts, horoscopes and horse racing tips.
• Business Consultants and Personal Trainers offer advice over the phone, and are paid for every minute whilst on line.

What Are Premium Rate Services ?
Amongst the many new telephone services introduced after privatisation were PAY-PER-CALL services - which in the U.K. are known as Premium Rate Services. These are “incoming only” services. Callers dial a “090 number” and either listen to recorded messages or are connected to live operators. The people who provide these services on the premium rate lines are called “Information Providers”, or I.P.s.

I.P.s, when offering Services via premium rate are allowed to charge a fee in excess of the standard telephone call charge to cover the cost of operating the service. When a caller dials a premium rate number they are charged at a higher rate, which can vary from as little as 10p to as much as £1.50 for each minute they use the service.

The telephone company bills callers on behalf of the Information Provider; retaining a percentage of the call charges collected and pay the balance to the Information Provider. Charges for calls made to premium rate numbers appear as part of the customer’s phone bill.

Guaranteed Payment
The great advantage of this business is that the Telecom is responsible for billing and collecting the money from the customers who call the I.P.’s services. The I.P. provides and promotes the service, and after the end of each month receives payment from the Telecom for his percentage of the revenue generated in the previous month. In its simplest form, the premium rate service provides a simple, efficient billing mechanism. One which allows the I.P. to sell their service to hundreds or thousands of customers, without the need to arrange billing or collect payment. For the I.P., nothing could be easier, no billing, no collections, and best of all no bad debts!

Explosive Growth From Innovative Services
The Explosive growth of this industry has been the I.P.’s ability to successfully identify and promote services over the telephone which attract the public. Nevertheless, the I.P. would never have been able to earn sufficient profit from such services had he also been required to bill, and collect, the money from the thousands, or even millions, of people who call his service. The Premium Rate billing facility provided by the telecoms has made it possible for I.P.s to sell services cost-effectively over the telephone.

Operating Within The Premium Rate Network
In reading this manual it is important to understand the distinction between the main players in the Pay-per-Call industry. The Diagram below illustrates the relationship
between the Information Provider, The Service Provider and the Telephone Network Operator.

The Network Provider
The telephone company, or Telco - provides the premium rate network, allocates premium rate numbers, bills and collects the charges from the customers for calls made to the premium rate services. The teleco then pays the Service Provider a percentage of the income for calls made to the premium rate numbers issued to the Service Provider.

The Information Provider
The Information Provider creates and promotes the services and will use the services of a Service Provider to provide premium rate or live handling facilities.

The Service Bureau
The Service Bureau provides the facility whereby calls to the I.P.s service can be handled. The Service Bureau contracts for the instalation of premium rate lines in their premises, installs sufficient premium rate computer equipment and employs the live operators to handle the mass of incoming calls. The bureau provides daily or weekly statements of all calls made to the I.P.s service; and pays the agreed percentage of the revenue received from the telco to the I.P.

However, non of these activities need be exclusive. There are a number of Telecos who provide premium rate facilities, and there are a number of Service Providers who also act as I.P.s, promoting their own premium rate services. More recently, with the proliferation of new telephone companies U.K., many of these telcos are involved in all three aspects of the pay-per-call industry.

Premium Rate Dialling Codes
Under the latest rules all companies that operate premium rate services must use the designated 090 dialling codes in their advertising and promotional material.

Previously, premium rate services were offered on a variety of dialling codes which varied dependent on the carrier who supplied your service. Services will still be accessible on the old codes - such as 0330, 0660 and 0890 - until 28 April 2001, after which time they became inoperative.

Service Types & Charges
The fourth number of the new 090 codes indicates the potential type or cost of the service. The structure of the new 090 dialling code is:

• 0901 call cost up to 60p per min. with a maximum cost of £5.00 per call.
• 0904/0905/0906 open-ended at any cost per min. or fixed cost per call at any rate.
• 0907 pay-for-product services costing more than £1.00 per call.
• 0908/0909 adult services at any per minute rate.

The codes 090 2 and 090 3 have not been allocated at present and will be reserved for increased demand or new services. All services over £1.00/min. and certain services at £1.00/min. require ICSTIS' prior permission before operating.

All new live services require ICSTIS prior permission before operating, regardless of cost.

What tariff and dialling code can services operate on?
Each telephone company has their own range of tariffs. The most commonly used rates are 25p/min., 50p/min., 60p/min., £1/min. and £1.50/min. Services operating on £1/min. and £1.50/min. may need ICSTIS prior permission to operate. There are also single drop charges of 25p and 50p available.

International Premium Rate Services
These pay-per-call services are different from domestic premium rate services, because callers dial an international number, and the calls terminate in a foreign country. Thus a caller in Germany, Russia or the U.K. may dial an international number which delivers the call to Guyana in South America. Currently the major international termination points are Guyana, Sao Tome, Israel, Hong Kong, and Moldavia. The service bureau have their premium rate computers and live services located in these foreign countries. The actual cost of the international call depends on the callers location and the time of day the call is made. The payment made to the I.P. will also be determined by the country from which the call originated and the country to which it is delivered.

• The I.P. promoting international services could be located in any country in the world. These international numbers are primarily used to promote services in countries where:
• There are no local Premium Rate facilities available.
• Certain services cannot be promoted on the Premium Numbers in some countries, I.P.s use the international numbers to avoid the local restrictions.
• I.P.s using the same media to promote services in a number of countries, eg. adverts in publications such as the Int. Herald Tribune, or the Economist, which are distributed in several countries. Or more importantly, services promoted on the internet. By using an international number callers can access such services from most countries.

Countries Which Can Access International Premium Rate Numbers
Argentina
Australia
Austria
Belgium
Belize
Bermuda
Botswana
Brazil
Canada
Chile
Costa Rica
Croatia
Czech Rep.
Columbia
Denmark
El Salvador
Greece
Gautemala
Honduras
Hong Kong
Finland
France
Germany
Ireland
Iceland
India
Israel
Italy
Japan
Lesotho
Libya
Luxembourg
Mexico
Netherlands
Nicaragua
Nigeria
Norway
Panama
Pakistan
Paraguay
Peru
Phillipines
Poland
Portugal
Romania
Russia
Saudi Arabia
Singapore
South Korea
Sri Lanka
Sweden
Switzerland
Taiwan
Thailand
Turkey
United Kingdom
United States
Uraguay
Venezuela
Zambia
Zimbabwe

Telcos Which Provide Premium Rate Facilities ?
There are an increasing number of telephone companies - or network operators
- offering premium rate facilities. They normally lease their lines to Service Providers who provide the necessary premium rate equipment required to handle calls to the services. The on line services are designed and promoted by Information Providers.

British Telecommunications Plc
Value Call Sales Department
0800 333 222
Cable & Wireless
01162 652 527
Colt
0207 863 5621
390 3900
Core Communications
01925 663 282
Energis Communications
0207 206 5234
MCI Worldcom
0800 018 0484
Norweb Communications
Sales Dept. 0800 195 0800
Opal Communications
0161 222 2000
Redstone Network Services
07020 001 000
Telecom One
0207 452 0453
Telewest Communications
01142 494437
Telinco
0870 740 0832
Telstra (UK) Ltd
0207 858 8934
Thus Ltd
Sales 0800 027 2828
Torch Telecom
01924 882 676
Vodafone Value Added &
Data Services Ltd
01635 682603
01635 633342

As each telephone company offers a different range of services and payout, you should contact several telcos and request details of their services, charges and payouts. But before selecting a carrier there are two important considerations:

The Payout Rate
This will vary marginally from teleco to teleco. Invariably the payout you receive will depend on the volume of calls which you generate each month. However, there is fierce competition between the telcos, so if you have a service that can generate millions of calls, it is possible to negotiate better terms than those offered in their printed literature. But don’t expect them to negotiate unless you can produce some evidence of your ability to perform.

The quality of service
Until the mid nineties only B.T., Cable & Wireless and Vodaphone offered premium rate facilities. Since then a host of new carriers have appeared. Unfortunately many of the new telcos have limited experience and even more limited line capacity. The result is that many Service Providers and their I.P.s have suffered serious loses when these telcos have been unable to cope with a high volume of calls.

If you expect to be a major player be careful to ensure that you don’t select a telco simply because they offer the highest payout. If you lose 10% of your calls through lack of line capacity that will more than offset the extra payment being offered.

PREMIUM RATE OFFERS OPPORTUNITIES FOR EVERYONE
A vast range of people and companies are offering services in this lucrative industry. They include part-time entrepreneurs, multi-national companies, major media corporations, including media giants like Murdoch, the B.B.C. and ITV. Over 1,000 service providers offer a wide range of entertainment and information services, which can be accessed by phone, fax, PC or television.

There are numerous opportunities at virtually every level of this exciting business, many of which offer the potential to create a massive monthly income. Anyone with the right idea can become a successful Information Provider. The only limit is your imagination.

But to succeed your service must attract a sufficient number of people who will regularly call the service. Otherwise it will fail because the call revenue will not be sufficiently high to cover the operating and advertising costs.

THE RANGE OF SERVICES
Information Providers are earning very substantial incomes from premium rate services, these include:

INFORMATION SERVICES - on everything from horoscopes to stock market reports. There are services offering information on slimming, pop music, murder mysteries, Hollywood celebrities, discount travel, used cars, dating, stock market; weather, holiday, medical, legal and consumer advice lines.

POLLS & VOTING SERVICES - T.V. shows regularly use the lines to collect their viewers opinions by asking them to vote by calling the Premium Rate numbers. More recently the T.V. companies have used the service to select participants for talk and game shows, the most recent example being, “Do You Want To Be A Millionaire”.

ENTERTAINMENT SERVICES - for adults and children; which include, pop programmes, interactive games, trivia contests, competitions, stories, etc.

SALES & MARKETING SERVICES - are regularly used to promote a whole range of products and services. International giants like Coca Cola, McDonalds, EMI - have all used premium rate to promote their products. More recently I.P.s have started selling products by phone, collecting payment from the Telecoms.

WHICH SERVICES DO PEOPLE CALL?
The bulk of the premium rate market is still concentrated in the classic services.
Currently the breakdown of calls to the classic services are as follows:

• Dating/Virtual Chat 18%
• Adult 5%
• Competitions 36%
• Info/Entertainment 17%
• Sport 10%
• Psychic/Tarot 7%
• Other 7%

The analysis over the past decade indicates that dating and virtual chat services
are responsible for an increasing percentage of traffic.
Call minutes (millions) by service :
Service type Call minutes
Special Services 35,800,000
Dating/Virtual Chat 75,500,000
Adult 20,000,000
Competitions 150,000,000
Info/Entertainment 68,000,000
Sport 39,000,000
Psychic/Tarot 30,000,000
Revenues in £ millions by tariff band :
Tariff band Revenue
Special Services 4,000,000
Around 50p 176,000,000
£1.00 16,000,000
£1.50 6,000,000
Total 202,000,000

Special Services include the following call tariffs:
* Voting (10p/call)
* Single drop (25p/call. 50p/call
* Interactive Games 96p/min.)
* Low Rate (25p/min. flat rate)

The table above breaks down the services by tariff. Despite the industry clamour
for a wider range of tariffs, the market is still dominated by services at
around 50 pence per minute. Services at around 50 pence per minute account
for nearly 90% of the call minutes and revenues in the U.K. market.
Services at £1.00 and £1,50 per minute are still relatively small contributors to
the classic services. However these higher rates are growing fast and will
become increasingly significant in the future.

FIRST STEPS TO SETTING UP A SERVICE
What you must do before you can start operating a service! The premium rate industry is regulated by ICSTIS and all participants are required to run their services in compliance with the ICSTIS Codes of Practice which must be read to ensure that your services do not breach the Code.

There are a number of services which are banned all together. Others which require prior approval from ICSTIS. So to avoid wasting your time, check the Code of Conduct, before you start your service.

Recorded message services need to comply with the eighth edition Code of Practice. The Code has three general sections and then sections applying to particular categories of services such as competitions and virtual chat.

Live services must also comply with the ‘Live Code of Practice’.
ICSTIS Guideline No. 3 should be read to find out if the service requires prior
permission from ICSTIS to operate. If the service does not require prior permission
it can be set up and run immediately provided it complies with the

Codes of Practice.
Which services need ICSTIS prior permission before they can operate?
The majority of premium rate services do not require permission from ICSTIS
before they can operate. However, under paragraph 2.3.1 of the Code (eighth
edition), some types of service need to be assessed by the Committee and
given permission beforehand. At present, permission is given for each particular
service, rather than to individual service providers or network operators.
The following types of service require prior permission from ICSTIS before
operation:

* all services charged at more than £1.00 per minute,
* all live conversation services,
* virtual chat services charged at £1.00 per minute,
* all services (other than fax services) with a visual element - such as computer
bulletin-board services,
* consumer credit services - such as credit brokerage and debt counselling
services.
If the service requires prior permission, the appropriate guideline for the type
of service to be run should be read. Then an application form needs to be completed
and returned to ICSTIS. If the service is given permission, a
certificate will be issued enabling the service provider to run the service.
The Secretariat can be contacted by phone or e-mail to give advice on the
Code or how to apply for prior permission.
Telephone: 020 7240 5511
Fax: 020 7379 4611
Email: secretariat@icstis.org.uk

HOW TO BECOME AN INFORMATION PROVIDER
Having decided that you have a service which will attract callers in sufficient
numbers, you must then decide how you are going to deliver that service to the
callers. As an I.P. you can deliver your services in one of the following ways:
1] Establish Your Own Premium Rate Centre
2] Use a Service Bureau.
3] Use the PREMIUM PHONE SERVICES’s Bureau.
We will examine each of these options in detail. Your final choice will depend
both on the capital resources and the time you have available.

[1] ESTABLISH YOUR OWN PREMIUM RATE CENTRE
The first question to ask is, “Should I use a service bureau or should I buy my
own equipment and contract directly with the telephone company?”
As a general rule, unless you have substantial capital, you are better off using a
service bureau, since the overall cost of equipment and other start up expenses
can be in excess of £40,000.
To establish an premium rate centre, with a 30 line system, your costs include:
1] installation of Premium rate lines and annual rental, £1,000.
2] purchase premium rate computer; £10,000
3] salary trained operators to programme the equipment; £30,000 per annum
4] pay the ICSTIS bonds for Live Services. £20,000
N.B. - the above does not include the salaries of staff for your live services and
administration. Nor your all important advertising budget.

COST OF INSTALLING THE PREMIUM LINES
To create a viable Premium Rate Centre, you must install a minimum of 30 lines.
Installation charges are currently £26 per line, with a quarterly rental of twenty
five pounds. Both installation and rental charges must be pre-paid.

USING SIMPLE TAPE MACHINES
At a very simple level you can avoid purchasing expensive premium rate computers
and use tape equipment very similar in operation to a telephone answering
machine. A 13 line machine can be obtained for under £2,000. The major
disadvantage is that this equipment limits you to a single message and you cannot
record the caller’s details.

Also the service provided by these machines is of the ‘’barge in” variety. Namely
callers will seldom hear the message from the start. Once the tape starts playing,
any new callers will only hear the message from the point at which they
connect. This is a BIG disadvantage as many people believe they have dialed
the wrong service and immediately replace the receiver. You lose the caller and
the income!

COSTLY INTERACTIVE COMPUTERS
Having installed your lines you must then install an premium rate computer to handle
the calls. A reliable thirty line computer, including installation, costs in excess of
£10,000. The companies supplying these computers all insist on prepayment for
their equipment.

SKILLED STAFF
To programme and monitor your premium rate computer, you must employ a programmer.
People with the necessary skills do not come cheap! You will be lucky
to find a competent programmer for less than £25,000 a year.

INSTALLATION DELAY
Should you decide to create your own centre your next problem is line installation. In the short term, this takes time. All the carriers have a lengthy installation period. Currently they are quoting four to eight months.

LIVE SERVICE BONDING
The Live Services are unquestionably some of the most profitable. Should you decide to operate such services you will be required by ICSTIS to pay a bond of at least twenty thousand pounds.

To summarise. The main deterrents to establishing your own centre are:
[1] Cost of equipment and lines.
[2] Hire of expensive computer staff.
[3] Delay on installing the lines.
[4] High bonding costs.
You should also consider whether it is worth spending thousands of pounds on equipment and staff when you could direct that money to promoting your service and enjoying the resulting income.

[2] USE A SERVICE BUREAU
If you are new to the Premium Rate business and wish to minimise your risk and capital outlay, the solution is to rent line space from an existing Service Bureau. These companies provide a wide range of facilities to aspiring Information Providers. They provide your link to the network operators. Initially Service Bureaus developed because the telephone companies or network operators did not offer the premium rate services required to handle the calls. Today the major reason for service bureau growth is the realisation that many interactive voice processing applications require an extremely high level of programming expertise to create the services. As owners and operators of extensive telecommunications equipment, they will guide you and provide you with the services which you need to become an Information Provider. They relieve you from the task of maintaining and operating the equipment.

The bureau will also provide you with ready-to-run programmes for such services as Dating, Competitions, Live One-to-One, Psychics and Tarot.

These are services which the bureau is already running, ready for you to use.
All you are required to do is advertise the service.

These ‘Turnkey Services’ are designed for the high volume markets. For most new Information Providers, it is better to learn the business using these proven services rather than starting a new, untested service, that may or may not have a big enough market to make it profitable.

KEY ADVANTAGES TO USING A SERVICE BUREAU

Minimises Start-Up Costs
By using the services of a bureau you avoid the capital cost of installing your own lines or purchasing the premium rate computers necessary to handle the calls.

No Commitment.
There is little or no commitment expected from a client company. Since service bureau services are leased on a monthly basis, you won’t be stuck with the service longer than you want. If you discover that your service turns out to be a dud, you can walk away with minimal capital loss.

Your First Priority Is Promotion
As a new I.P. with an untried idea, it is more sensible to test your service with a Service Bureau. You are better advised to concentrate your resources on advertising, rather than commit your limited capital to lines and computer equipment.

More Convenient
A Service Bureau eliminates all the expense, inconvenience, and delay normally encountered when trying to establish your own Premium Rate centre. It has all the necessary lines and equipment you need to get your service operational within a matter of days.

Higher Payouts
Since service bureaus generate millions of minutes of traffic each month, they can negotiate higher percentage payouts from the telephone companies. In turn the bureau can usually offer new Information Providers a higher percentage payout than they could negotiate directly with the the Telecoms.

No Office Required
You can operate from home. The remote update capability of premium rate computers
allows an I.P. to update messages and retrieve information via any touch tone telephone.

Enormous Call Capacity
A Service Bureau will normally have a large line capacity, which removes any restriction on the number of calls that can be received by your service. This is particularly important if you offer a service such as a contest that is promoted on television, which can generate thousands of calls in a very short period of time.

Constant Upgrading of Technology.
Leading-edge technology is a tool of the trade for a service bureau, and they are quick to embrace any new software or hardware, ensuring that you have use of the latest technology.

On-site Expertise.
An in-house voice-processing system requires a full time programmer to maintain the system and programme new applications. Service bureaus have highly trained technicians and programmers on staff who are familiar with a wide variety of applications. By leaving all the nitty-gritty technical to the experts, an end user can focus on the marketing and providing the service.

Expert Advice
The biggest advantage in using a Bureau is to take advantage of their experience in the Premium Rate business. Most will include initial consultation and programme analysis for new IPs. Their specialist know how and advice can often determine whether your service succeeds or fails. Bureaus can plan your budget, give advice about advertising and marketing, plus advise on the design of your service and its viability.

Professional Assistance
A Service Bureau can also offer you professional script-writing and recording facilities. This will help you to create a successful service that will have people constantly calling your number. Some bureaus have in-house TV and radio production facilities.

Great for Seasonal Programs
For programs that only run three or four times a year, a service bureau is the perfect resource.

Great for Testing New Services
Service bureaus are great for testing the effectiveness of new services before investing in a heavy marketing programme.

SELECTING A SERVICE BUREAU
When it comes to selecting a service bureau, you will probably make contact by phone - after all this is the phone business - but you may want to visit the facilities. Any service bureau should feel happy to meet you in person. If a service bureau refuses your visit - you have cause for concern.

Service Bureau Reliability
IPs need a service bureau that has a good record of low down-time, reasonable payouts per minute for the services they offer, good customer service with live people to answer your questions, a long history of making payments to their customers on time.

The number of years the service bureau has been providing Premium Rate Services is important If they’ve been around for a number of years and are soundly financed, they are likely to provide a reliable and honest service in the future.

Check the bureau’s in expertise. premium rate systems require experienced staff to
maintain the system and programme new services. Does the bureau currently offer services similar to those you wish to operate? Experience in the particular service will ensure that your service is up and running quickly, and without any bugs.

Call Volume Capabilities
If you choose to advertise on radio or television, you will need a service bureau with the capacity to handle the volume - the surge of calls that may come in after a television or radio spot is aired. If you exceed a service bureau’s capacity, then some of your callers will get busy signals, resulting in lost revenue for both you and the bureau.

Customer Service
Regardless of the service bureau’s size, you should expect a certain level of service from them. Insist on getting the name of a contact person. Call counts and other vital data should be available to you on a regular basis. The best arrangement for call counts is daily access to your call stats. Some service bureaus provide daily faxes or emails containing this info. Find out if the service bureau charges for this and how much. In addition to daily telephone access to stats, this information should be confirmed weekly/monthly with a printed report.

Also ask about monthly revenue payment - the date monthly cheques are mailed and when will the first cheque be sent?

Remote updating facility is essential. If you operate a service which offers information which must be updated frequently, you must be able to achieve this remotely from your office or home over the phone. Check the bureau offers this facility.

Turnkey Services
Some bureaus offer IPs the opportunity to use established services which they are already operating for their customers. The most common services are Live One-to-One, Dating, Psychics, Tarot, Adult and Sports Info. The initial cost of programming these programmes is high, but so ultimately is the demand and the revenue to be earned. Using an successful turnkey service can often be the best way into the premium rate business for the newcomer.

BUREAU CHARGES
Service bureaus normally charge:
[1] a start-up fee - this can vary widely from few hundred pounds for a simple
programme to £10,000 plus for a complex programme which requires
interactive menus and voice storage.
[2] monthly service fee - these can vary from a £100 to over £1,000, depending upon call volume, programming and storage required.
[3] per-minute charges - this is the amount which the bureau retains from the call income due to you from the carrier. These can range from a few pence a minute to 40p or 50p. depending on your call volume and any additional services provided, such as live operators. The larger your monthly call volume the lower your per minute charge. Take into consideration the call volumes you expect for your line. If a service bureau has high per-minute charges, high call volumes could be expensive, even if the monthly fee is
low.

When comparing bureau charges be sure to include all the relevant costs for your type of service. A bureau with low monthly charges, but high per minute charges, may suit a service with low call numbers, but will be costly if you achieve high call volume.
You should also establish the cost of other services you may wish to use. These include, caller info capture and storage; downloading & transcription of info; special reports; and special programming.

System Security
Technology is not foolproof. Any business relying on technology can fall prey to power or equipment failures. Check if the service bureau offers a 24-hour generator and program back up in case of power and/or computer failure.

Contracts
It’s important to have a written contract which states clearly what your commitments
are, what you are due to be paid, and when. There are short term contracts, e.g., 30 days, and there are long term contracts for a year or more.

The advantage of a short term contract is that if your service doesn’t work, you’re free to leave. The disadvantage is that if your service is successful, the bureau can change the deal knowing that since you are bringing insignificant profits, you wouldn’t want to risk switching service bureaus. More importantly, as the bureau owns the numbers, to which there may be a substantial number of residual calls, an I.P. will be reluctant to move and lose that revenue.

If you opt for a longer term deal with the bureau, be sure that you have a reasonable
release clause in the contract.” Why continue to pay monthly fees when your service is dead? “The bureau should be your partner, and it should make money if you make money, so it is in its best interest to allow you to discontinue an unsuccessful service and quickly bring up another one that is going to be successful.

Questions to Ask Before You Sign-Up With Any Telephone Company
The following is a list of questions an I.P. should ask a prospective service bureau.
* What kind of charges (per minute, per month, other) do I have to pay?
* What are the charges for each kind of service?
* What happens if there is power failure or equipment breakdown?
* What other companies do you service?
* What long distance carriers do you represent?
* What is the time frame to get my service on line?
* What kind of stat reports do you provide?
* Who will be my contact person?
* Will I be able to update my programme remotely.?
* Will you advise me on my advertising?
* Do you have turnkey services which I can use?
* What is your experience with my type of service?
* How many calls can your equipment/staff handle simultaneously?
* What in-house facilities do you offer (name capture, fulfillment, etc.)
* Are you an information provider as well as a service bureau?
* How often will I get my call stats?
* How many years have you been in business?

It’s crucial for you to choose a service bureau whose capabilities and expertise are a good match for your service. Rushing into the Premium Rate business is a recipe for disaster.