Verizon, Qwest hike LD directory assistance fees

Citing competitive opportunity and rising costs, Verizon Communications and Qwest Communications are raising the fees they charge for long-distance directory assistance.

Last week, Verizon raised its fee to $1.25 in New York and New Jersey for each out-of-state listing, up from $0.95. In July, customers in Maryland, Virginia and the District of Columbia will see their rates raised to identical levels. Next month, customers in Massachusetts will be paying $1.25 for out-of-state listings, but $0.95 for in-state listings. No timetable has been set for rolling out new prices in its other states.

Next month, Qwest will be raising its fees to $1.25 from $0.95 in Nebraska, North Dakota and Washington for both in-state and out-of-state listings, while customers in Minnesota will see their rates go from $0.95 to $1.25 for out-of-state listings only.

Customers in Wyoming and southern Idaho (which is governed by two public utility commissions) experienced similar price increases this month. In March, Colorado residents saw their fees go up to $1.25 from $0.85. However, in several of these states residents receive two listings for the $1.25 charge, and in many instances calls are completed at no additional charge after the listing is provided.

The wheels were set in motion about a year ago for these increases when AT&T raised its long distance directory assistance rates to $1.49 and $1.99 from $0.99, said a Verizon spokesperson.

“That sort of let us all know that the market-based price, which is the price at which the consumer perceives value for the thing that you’re selling, was above where we had our price set,” he said. “We decided that, if we stayed below the [long-distance] carriers and still provided the best service, the value proposition would still be there. And we need the revenue, so we said, ‘Let’s go for it.’”

Though the opportunity may have been there, Verizon also believed it needed these price increases—at least compared to AT&T’s—to stem the rising costs of providing quality directory assistance, added its spokesman.

“We employ 4000 operators and handle 4.5 million calls a day using very expensive databases, some of which we have to buy from other companies,” he explained. “If you were to start a business of this size today, I can’t imagine what you would charge for each call.”

Nevertheless, the spokesman said the decision to hike the fees was not made lightly.

“Verizon is traditionally a conservative pricer,” he said. “In this case, the product was introduced two years ago as a competitive alternative. So, we had to uproot ourselves from the fundamental position that 95 cents is a pretty good price and convince ourselves that raising the price is a good idea.”