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BT to trial free phone calls

By Lisa Burroughes

Published: Wednesday 28 April 1999

BT is to offer customers free calls if they are willing to have their conversation interrupted by advertising every few minutes.

The service will be piloted for three months, starting in June, in Tyne and Wear and in Bristol. If it proves to be successful, a national rollout could be in place by the end of the year.

According to BT, Customers will hear an advert at the beginning of each call and at regular intervals throughout, using software from Swedish company, GratisTel. Similar services using GratisTel technology have successfully been on the market for the last three years in Sweden - attracting more than 700,000 users.

Andy Greenman, senior analyst at Yankee Group, is confident BT's service will have similar success in the UK. "People in the UK are pretty aware that there are cheaper ways of making calls than by using BT. And there are certain types of users who would be willing to put up with the interruptions: for example, students and low-income families," he said.

Greenman added that although it isn't a hugely lucrative market for advertisers, in Sweden many banks and media groups are keen to target the student market. A spokesman for BT would not confirm who it has signed up to advertise on the service, but said the telco is "in discussions with a couple of major companies as well as a number of regional, small businesses wanting the regional targeting".

However, this is not the first offering of its kind in the UK. Free Telecom is due to launch a nationwide service this autumn, and had also competed with GratisTel to provide the software for BT's service.

Darren Makin, MD of Free Telecom, said his company has just signed a deal with Germany's Viag Interkom to trial the service. "There is advertising all around us - you get a three-minute advert during your TV programmes, so why not get a 30-second advert and get a free three-minute phone call?" he said.