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Phone bills for small firms to rise

And you thought more competition meant lower bills

Small and medium-size businesses can expect to spend up to 50 percent more this year on telecommunication services than last year, according to market research firm Yankee Group.

Simply put, smaller European companies (20 to 99 people) are not very good window shoppers when it comes to their telecomms needs.

In a survey of eight European countries Yankee found deregulation in European telecommunications is driving up costs for smaller firms, but the main factor keeping prices high is that those companies aren't shopping around for better deals.

These smaller firms are opting to remain with their existing suppliers, such as BT, partly because of a desire to buy a combination of services from a single provider. But, said the Yankee Group, there is also an element of apathy.

The study also found that service providers are only just beginning to reach out to smaller businesses in Europe to offer competitively priced telecommunication services as well as broadband services.


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