How to Read a Business Phone Bill, Line by Line

Pull your last phone bill out. If you are like most businesses around here, you can identify maybe half the lines on it. That is not an accident. Phone bills are formatted to make comparison shopping hard, and the profit lives in the parts nobody reads.

Here is what a typical Illinois small business bill looks like once you break it apart, and what each piece is really for.

The part that is actually phone service

Usually the smallest section. On a copper (POTS) line this shows up as a network access line or business flat rate line, and around Illinois it now runs $50 to $100 per line. On hosted service it is a per-seat charge, typically $20 to $35. This number is the only one most people compare, which is exactly the problem.

Features you may be paying twice for

Voicemail, caller ID, call forwarding, hunting, three-way calling. On legacy service these are itemized at $3 to $12 each and they stack up fast. It is common to find a business paying $40 a month in features on a line whose only job is to ring a fax machine. On modern hosted service these are included, so if you see them itemized, you are looking at a legacy bill.

Surcharges, and which ones are real

There are two kinds. Real government items: the federal Universal Service Fund, the Illinois 911 surcharge (billed per line), and telecom excise taxes. Those are legitimate and every provider passes them along.

Then there are the invented ones. Carrier Cost Recovery Fee. Administrative Recovery Charge. Network Access Recovery. Regulatory Compliance Fee. Those are not taxes. They are the carrier's own revenue, named to look like taxes, and they commonly add 10 to 25 percent to the bill. You cannot negotiate a 911 fee. You can absolutely leave a carrier over a recovery fee.

Hardware you finished paying for years ago

Leased handsets at $5 to $10 each per month, forever, on phones that cost $90 to buy outright. Five leased phones is $600 a year for equipment you will never own. Look for a wire maintenance plan too, which insures inside wiring you may not even have anymore.

Lines that serve nothing

This is the one that surprises people. Businesses that moved, remodeled, changed alarm vendors, or retired a fax machine usually keep paying for those lines, sometimes for years. The carrier has no reason to bring it up. Nearly every bill review turns up at least one line nobody at the company can account for.

How to audit yours in twenty minutes

• Print the full bill, not the summary page. The summary hides the itemization.
• List every phone number on the account and write down what it does. Anything you cannot name is a candidate for disconnection.
• Add up everything that is not the base line rate. That percentage is your real overhead.
• Search for the word recovery. Those charges leave with you.
• Note the contract end date, and remember your numbers can port out regardless of contract status.

If you want a second set of eyes, send us the bill. We do free bill reviews for businesses in the 815 and we will tell you what to cut even if you stay where you are. Half the value is just knowing what you are actually buying.