April  2000

Your letter was not only interesting but also timely. About two hours before receiving my March issue of INTERNET TELEPHONY� I happened to review my phone bill because it seemed to be higher than usual. I did a detailed review of each item. There it was, a charge for AT&T, my long-distance carrier, for $12.33. There was no long-distance usage, but as you mentioned they added a �minimum usage� charge of $3.00. Add in the Universal Connect Charge and Carrier Line Charge of $8.67 for a total of $12.33. This is for non-usage. I am very interested in any feedback you get and will appreciate any remedies. You write it. We�ll read it.
� William J. Boyd

I live in Chicago and � like Bill Kowalczyk�s mother � I make few long-distance calls. AT&T and the other major Interexchange Carriers (IXCs) indeed have turned their corporate backs on the small user. Not only are there monthly fees or monthly minimums, but these carriers also overcharge customers when collecting reimbursement for new charges the FCC requires them (the IXCs) to pay to the local carriers. Despite the IXCs� rhetoric, the FCC does not require them to collect these charges from their customers.

The maximum Presubscribed Interexchange Carrier Charge (PICC), which the IXC pays the local carrier for each single-line customer is $1.04 per month. Any excess PICC above this amount is pocketed as pure profit by the IXC, or subsidizes the PICCs for multiline customers.

The Universal Service Fund (USF) is paid by the IXC as a percentage of call billing (usually less than 5%). Yet AT&T and other carriers often bill their customers a fixed USF fee as though each customer spent around $19 per month. The small users are forced to subsidize the large users.

Bill�s mom can and should end her presubscription to AT&T by calling Ameritech and telling them she does not want any presubscribed long-distance carrier. AT&T will no longer pay a $1.04 PICC to Ameritech. Ameritech, with the FCC�s blessing, will start charging Mom a $.72 NO-PIC charge (I am not making this up!) All her local, emergency, and toll-free calls will work as usual, but long-distance calls (to area codes other than 847, 630, 708, 773, 312, and parts of 815) dialed with 1+ won�t go through.

Mom could use a prepaid card, such as those sold by Sam�s Club for 10 cents a minute full cost (no additional taxes or fees to buy or to use). Ironically, the service purchased through Sam�s is provided by AT&T.

She could instead seek a dial-around carrier, which does not charge any PICC, and does not charge a fixed USF fee (or, better yet, charges no USF at all). PT-1, for example, charges 7.9 cents per minute for calls and a USF of only 3.9% of actual calls billed. No calls � no charge. The total cost for long-distance, then, is the NO-PIC fee of 72 cents per month plus 8.2 cents per minute for calls actually made. PT-1�s access code is 1016868. Mom would merely dial such a code, followed by 1 and the area code and number. When calling from home, this is easier than using a prepaid card.

The FCC did not realize the impact their new rules would have on the occasional user, who was accustomed to paying per minute for services actually used. Those users are now paying per month for services not used.
� Richard Arsinow, Chicago, IL

In response to Rich Tehrani�s, �Arbitrage, Far From Dead� (Publisher�s Outlook, February 2000):

Rich,
Please allow me to set the record straight. You were not screwed by the telephone company. I have worked for US West Communications, formerly Northwestern Bell Telephone Company, for 28 years. We provide the dial tone that allows you make connection with the world. Federal law prohibits us from transporting a connection beyond the LATA (Local Access Transport Area). Simply put, we cannot connect you past the area code. In order for you to call outside the LATA you must select and engage a long-distance carrier.

I find it hard to believe that you do not understand the difference between a telephone company and a long-distance carrier. Companies (that�s plural, meaning a lot of them) like MCI WorldCom, AT&T, Sprint and the like, are unregulated. That means that they are free to charge whatever the market will accept. They are hardly a monopoly. You, the customer, are free to choose whichever long-distance carrier you feel will give you the best rate.

Perhaps you did not get the best rate available. Maybe you were screwed. But, you were not screwed by the Telephone Company. You had a $530 LONG-DISTANCE BILL, not a phone bill.
� Earl Root
US West Communications
Holdrege, Nebraska

I can�t believe it; someone believes their long-distance provider gives low rates anywhere. The situation has gotten so bad (or competitive) that I no longer have a long-distance provider and make all my calls through 101xxxxx dial-around providers.

My default page in my browser is a custom page of useful sections and links. One of the sections is �Dialaround.� The link I use most frequently is ABellTolls.

Point your browser there. There are sections for intrastate, interstate, international, and others. Once in a section, look for the lowest cost provider with no or minimal monthly fees.

Go back once a month to check that your 101xxxxx service is still the lowest cost. I recently had to change the interstate 101xxxxx service since they raised their rates, at least for now.
� David Harralson

I�m glad that you�ve learned to speak other languages beside ATT-MCI-Sprint. I learned this a couple of years ago and now use ATCALL. I would urge you to check them out. I don�t know what the rate is to Argentina, but I do know that what you see is what you get... No minimum, no monthly, no add-ons, no kidding! The only thing I�m not thrilled with are some of their customer service agents. They need a few more English classes.

No fan of the Big 3,
� Cindy Nichols