Every second counts: LCI introduces per-second billing plan

LCI has broken from the pack of long-distance carriers that round up to six seconds or a full minute by offering Exact billing-charging down to the second.

"We don't charge customers for time they don't use by rounding their calls up to the next full minute like most other carriers do," said John Taylor, senior vice president of LCI's consumer business segment. "So, there's not only value when you pick up the phone, there's value when you hang up, too. We think that's fair."

Most long-distance companies either charge in 60-second or six-second increments.

Exact billing is available through the carrier's new residential long-distance plan, LCI Difference. The plan also offers flat rates of 9 cents a minute for evening and weekend calls and 15 cents a minute during the day.

Per-second billing applies to all of LCI's calling services-including state-to-state, international, in-state, local toll and residential 800, and calling card calls-after the first minute. "Even if a call is under a minute, there are still costs incurred with originating and billing that call," explained a spokeswoman.

But going from charging in six-second increments to per-second charging was a logical next step for LCI, said Jonathan Ebinger, director of marketing.

"We consider ourselves simple, fair and inexpensive," he said. "Consumers may find a company with a better [rate], but we can compete in being fair to our customers. Why not charge them for exactly what they use?"

Research by TeleChoice showed customers charged by the second could save an average of 10.7% over those charged by rounding to the minute, Ebinger said.

Other studies have shown that consumers place a high priority on being charged precisely for the calling time they use.

However, AT&T has "looked at this issue for years and found that it is not on the radar screen for consumers," according to a spokesman. He said the carrier offers per-second billing to its business customers and will provide it to residential consumers if they request it. "But we continue to find that consumers would rather get a good rate per minute all the time."

MCI's research has had similar results. "The difference is literally pennies a month," said an MCI spokesman. "We offer 5 cents Sundays, and our customers would rather have a low rate during the time they make the most calls rather than some plan you need a calculator to figure out what you're saving."

Consumers would need not only a calculator but also a stop watch, said a Sprint spokeswoman. "You can't split a penny, so that small of an increment doesn't work," she said. "You loose simplicity, and the savings are minimal."

But those pennies add up, said Ebinger. "In no other industry is it acceptable to charge customers for something they're not using," he said.

LCI plans to launch Exact billing with an advertising campaign before the end of the year. He said the plan will cost the carrier some money.

"But we are the eighth fastest-growing company, according to Fortune, so we're not as interested in the costs as some carriers who are losing market share would be," Ebinger said. "We're interested in bringing customers in the front door and treating them fairly."

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