Ring up the best phone deal.

• Author: Wohlafka, Gary
• Position: The CFO's Guide to Information Management: Telecommunications

Take some time out to understand what's going on in the telecommunications industry, and then tackle your corporate phone bills with a few good strategies.

January will mark the 10th anniversary of the landmark legislation that broke up the AT&T phone monopoly. In those 10 years, a competitive marketplace has grown up as hundreds of new long-distance carriers emerged. Today, the United States enjoys some of the lowest telephone rates in the world.

However, few observers could have predicted the confusion created by myriad rate offerings, deals and the hidden costs of long-distance rates today. For many financial executives, matching their company's needs with the phone companies' offerings is like playing roulette. Some agree to rate plans without knowing all the details, hoping they turn out to be the most economical for the company. And the situation is getting even more complicated.

Companies that sprang up to compete for AT&T's clients have forced the former monopoly to invent ways of maintaining its market share while retaining its long-distance revenues. Enter the highly skilled marketing, advertising and sales professionals, the endless deals and the unbundling and bundling of costs. AT&T's two major competitors, MCI and Sprint, have gone head-to-head with it by using numerous and often complicated service offerings. These sometimes contain pitfalls that can be costly.

Laws intended to heighten competition have only fueled the confusion. Last May, AT&T took another hit with the advent of 800 portability, legislation that transfers ownership of 800 phone numbers from the telephone company to the user, making it easier for a company to change carriers. In the past, long-distance companies like Sprint and MCI couldn't penetrate this market (AT&T had 90 percent) because most companies with an 800 number didn't want to deal with the problems of changing to a new number, such as informing customers and changing letterhead and business cards.

Theoretically, 800 portability was supposed to require AT&T simply to adjust its rates to compete with other long-distance carriers. Instead, another round of deals and offers began, including long-term deals and the combining of inbound and outbound calls under one offer.

You can cut your corporate phone bill by as much as 50 percent through some of the hundreds of long-distance carriers vying for market share by plying deals and packages. But for every program with real benefits, there are two or...