International calling card rates are generally much cheaper than the rates you'll find on most landline and mobile phone plans.
The savings can be huge - you can easily save 50% off international long distance calls. In some cases, you can save 90% or more.
In one case we saw recently, the advertised per minute rate from a name brand carrier was 70¢ to an international destination. Calling that same destination using a popular calling card was just 1.9¢ per minute. Wow! that's a savings of 97%!!!
However, rates vary dramatically between cards or even for a given card. This can be seen most sharply in the per minute rates of calling cards from name brand carriers (e.g., AT&T) vs. cards from discount carriers (e.g., Pingo). The name brand carrier will generally charge you a lot more.
Why are calling cards cheaper?
There are several reasons.
- Lower branding and marketing costs. Most calling cards are sold by 2nd and 3rd tier wholesale telephone carriers set up largely to compete on the basis of low price. Usually, these are companies that the average consumer has never heard of. They operate national or global communications networks similar to brand name retail carriers, but their whole business model is to compete on low cost.
These companies are often perfectly legit and solid companies - some are even publicly traded in the stock market - but they operate largely in the background of the global consumer telecom landscape.
The key point is that these companies spend less on advertising and brand building which helps to keep their prices low.
Less robust telephone networks. The communications networks operated by the calling card carriers may not be as robust as the networks operated by Tier 1 name brand carriers like AT&T.
Generally speaking, these networks carry calls with acceptable call quality, but they are more susceptible to outages, background noise, or other quality problems. Usually this doesn't impact callers, but from time to time you might experience call quality problems that would be quite rare on a Tier 1 network.
As you might expect, these less robust Tier 2 and Tier 3 networks are cheaper to operate than the networks of the big players like AT&T.
Use VoIP internet telephony networks. Another thing about the networks operated by calling card carriers is that they often use a different and cheaper technology than regular phone companies.
Specifically, much calling card voice traffic doesn't flow across traditional switched telephone networks - which are generally quite expensive and heavily regulated. Instead, a lot of calling card traffic is carried over networks powered by a technology called VoIP, which stands for voice over internet protocol. VoIP uses basically the same technology that drives the internet.
VoIP networks are being built out very quickly around the globe and will eventually achieve the same level of quality and reliability as traditional circuit switched networks. However, for the time being they can be more susceptible to call quality issues - e.g., during peak call loads.
Lower customer service levels. Unfortunately, as in most any business, one casualty of low prices is less robust customer care. Much of the time, this doesn't matter, but when/if you have a problem with a card, it can become an issue.
While no calling card company will provide the kind of gold-plated customer care you get from a top tier phone company, some calling card companies are definitely better than others. And some companies provide downright terrible support.
One thing we recommend is that before you buy a card, you should call the company's customer support line and ask a few simple questions. That way you know that the line is working and that they are competent to provide at least some level of support.
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International calling card rates are generally much cheaper than the rates you'll find on most landline and mobile phone plans.
The savings can be huge - you can easily save 50% off international long distance calls. In some cases, you can save 90% or more.
In one case we saw recently, the advertised per minute rate from a name brand carrier was 70¢ to an international destination. Calling that same destination using a popular calling card was just 1.9¢ per minute. Wow! that's a savings of 97%!!!
However, rates vary dramatically between cards or even for a given card. This can be seen most sharply in the per minute rates of calling cards from name brand carriers (e.g., AT&T) vs. cards from discount carriers (e.g., Pingo). The name brand carrier will generally charge you a lot more.
Why are calling cards cheaper?
There are several reasons.
- Lower branding and marketing costs. Most calling cards are sold by 2nd and 3rd tier wholesale telephone carriers set up largely to compete on the basis of low price. Usually, these are companies that the average consumer has never heard of. They operate national or global communications networks similar to brand name retail carriers, but their whole business model is to compete on low cost.
These companies are often perfectly legit and solid companies - some are even publicly traded in the stock market - but they operate largely in the background of the global consumer telecom landscape.
The key point is that these companies spend less on advertising and brand building which helps to keep their prices low.
Less robust telephone networks. The communications networks operated by the calling card carriers may not be as robust as the networks operated by Tier 1 name brand carriers like AT&T.
Generally speaking, these networks carry calls with acceptable call quality, but they are more susceptible to outages, background noise, or other quality problems. Usually this doesn't impact callers, but from time to time you might experience call quality problems that would be quite rare on a Tier 1 network.
As you might expect, these less robust Tier 2 and Tier 3 networks are cheaper to operate than the networks of the big players like AT&T.
Use VoIP internet telephony networks. Another thing about the networks operated by calling card carriers is that they often use a different and cheaper technology than regular phone companies.
Specifically, much calling card voice traffic doesn't flow across traditional switched telephone networks - which are generally quite expensive and heavily regulated. Instead, a lot of calling card traffic is carried over networks powered by a technology called VoIP, which stands for voice over internet protocol. VoIP uses basically the same technology that drives the internet.
VoIP networks are being built out very quickly around the globe and will eventually achieve the same level of quality and reliability as traditional circuit switched networks. However, for the time being they can be more susceptible to call quality issues - e.g., during peak call loads.
Lower customer service levels. Unfortunately, as in most any business, one casualty of low prices is less robust customer care. Much of the time, this doesn't matter, but when/if you have a problem with a card, it can become an issue.
While no calling card company will provide the kind of gold-plated customer care you get from a top tier phone company, some calling card companies are definitely better than others. And some companies provide downright terrible support.
One thing we recommend is that before you buy a card, you should call the company's customer support line and ask a few simple questions. That way you know that the line is working and that they are competent to provide at least some level of support.
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