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Airespring's high cost area surcharge [Telecom]

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JimmyG...@mailinator.com

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Nov 6, 2008, 2:15:15 PM11/6/08
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I use Airespring for residential long distance (under the
Globalfibernet brand name). On my most recent bill, there was a "high
cost area surcharge" of a few cents.

The previous bill had mentioned that they would apply this surcharge
if a customer's calling patterns to high-cost areas exceeded typical
usage, and referred me to their terms of service. The terms said that
performing access arbitrage is prohibited, defined as a customer's
switching equipment being programmed to route calls to Airespring that
cost more for them to place.

This seemed like it was meant for large commercial customers, not
individual residential customers. And I wanted to know which number I
called counted as high-cost, so I know what my long distance rate
actually is. Even though it was just a few cents this month, it could
add up to a lot if I make some long calls to the high-cost number.

So I called customer service. The agent couldn't explain what this
fee was. She told me it was probably a state or local tax, and that I
should google it. I said that was unacceptable -- I needed to know
who was charging me this fee and why -- and she said a supervisor
would call me back. Someone actually called me back the next day, and
left a message and said I'd get a credit on my bill and wouldn't see
this charge any more, but she didn't explain what it was or why it
happened.

What exactly is this fee? Are long distance companies getting screwed
by obscure competitive local phone companies that charge them a lot to
place calls to their numbers? Can these charges cost long distance
companies more per minute than they charge their customers, and is
there any limit to how high they can be? How do unlimited long
distance plans handle this issue?

Jimmy

John Levine

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Nov 7, 2008, 9:09:59 AM11/7/08
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>What exactly is this fee? Are long distance companies getting
>screwed by obscure competitive local phone companies that charge them
>a lot to place calls to their numbers? Can these charges cost long
>distance companies more per minute than they charge their customers,
>and is there any limit to how high they can be? How do unlimited
>long distance plans handle this issue?

Every local telco has a termination fee, which the LD companies have
to pay at each end of the call. For big companies like VZ and T it is
very low, well under 1 cpm, but for small rural high-cost companies,
it can be substantial. I think I've seen 25 cpm for the uber-rural
Beehive Tel. You may have seen reports of fights between AT&T and a
rural Iowa phone co-op that used its high termination rates to try to
make millions of dollars by jacking up the call volumes via numbers
that provided "free" calls to places in Asia.

Normally telcos set their LD rates to average all the termination
fees. My telco in upstate NY is a small expensive one, so my LD
company charges me 5 cpm rather than the 2 cpm they'd charge if I
lived down the road in VZ territory. I've seen some that adjust the
charge per call, passing through the termination fees, but I don't
think I've ever seen one that used average rates except when they
don't feel like it.

Regards,
John Levine, jo...@iecc.com, Primary Perpetrator of "The Internet for Dummies",
Information Superhighwayman wanna-be, http://www.johnlevine.com, ex-Mayor
"More Wiener schnitzel, please", said Tom, revealingly.

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