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FCC Rules Against 'Call Blocking'
[June 29, 2007]

FCC Rules Against 'Call Blocking'


TMCnet Contributing Editor
 
The U.S. Federal Communications Commission (FCC (News - Alert)) said on Thursday that it would investigate the access fees that the 39 rural phone companies are allegedly charging long distance carriers for connecting calls in their areas.


 
The regulators are set to look into allegations by long distance carriers that some rural phone companies have been overcharging them by illegally boosting access fees and artificially pumping up phone traffic.
 
Long-distance phone companies cannot block customers from dialing free chat lines to avoid incurring charges imposed by local carriers, federal regulators said. The FCC has made it clear that no wireless company has any right to block calls to avoid inflated bills.
 
Associated Press reported that the FCC said no carriers “may block, choke, reduce or restrict traffic in any way.”
 
The statement came following complaints by a group of carriers including Sprint Nextel Corp., Qwest (News - Alert) Communications International Inc., and AT&T Inc. For Qwest, the ruling came just in time. The company reportedly had proposed creating a program that would subsidize high-speed Internet deployment to rural areas.
 
The telecom carriers filed lawsuits against more than 30 rural phone companies that they say have a habit of imposing higher per-minute rates to long-distance companies for connecting calls using local networks.
 
These carriers alleged that rural carriers were making illegal deals with conference and chat line services to drive up traffic and revenue.
 
Rural rates generally range from 2 cents to 10 cents, whereas major telecoms get paid closer to half a cent per minute when they connect one of their own local customers to a long-distance call from another provider.
 
In its ruling, the FCC said companies should use other means to address alleged unreasonable charges, such as tariff investigations and informal and formal complaints. The agency also said several local carriers and consumers were concerned about the call-blocking practice, while long-distance companies have asked the FCC to address the higher charges.
 
According to a Reuters report, AT&T (News - Alert) sent a letter to the FCC on April 4, 2007, claiming that ‘traffic-pumping’ was becoming a big problem; AT&T estimated that it would incur more than $250 million in losses this year as a result of the practice. The company said the rural carriers at issue had boosted the access fees they charge long distance carriers for terminating calls in their area.

AT&T also reportedly said some local phone companies then inflated traffic to their sparsely populated areas by offering kickbacks to operators of pornographic chat lines and other free calling services that agreed to advertise certain assigned phone numbers.
 

To learn even more about telecom regulation, check TMCnet’s White Paper Library, which provides a selection of in-depth information on relevant topics affecting the IP communications industry. The library offers white papers, case studies and other documents free to registered users.

 
Narayan Bhat is a contributing editor for TMCnet. To read more Bhat’s articles, please visit his TMCnet columnist page.


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