Google Voice and Reciprocal Compensation on NPR [Telecom]
har...@hallikainen.com
***** Moderator's Note *****
This is a good introduction to the ways that the reciprocal
compensation rules can be used to benefit certain classes of
traffic. CLECs are incentivized to serve "receive only" lines, i.e.,
lines which seldom make outgoing calls, so as to tip the compensation
rules in their favor. Since the terminating company gets paid by the
IEC, CLECs with a lot of conference-call or "chat room" or other
customers who answer lots of calls, but make very few, can turn a
profit.
Google, which is in the awkward position of having almost all
"originating" traffic, must pay the higher rates which some rural
ILEC/CLECs are allowed to charge for terminating calls.
Bill Horne
Moderator
John Levine
>compensation rules can be used to benefit certain classes of
>traffic. CLECs are incentivized to serve "receive only" lines, i.e.,
>lines which seldom make outgoing calls, so as to tip the compensation
CLECs made a lot of money from recip comp on calls to modem banks, but
that's not what's going on in this case.
This is "traffic pumping" in which midwestern rural LECs with very
high termination rates host conference bridges and numbers that
forward over VoIP to other countries. In the case of recip comp, the
big telcos had only themselves to blame, because they demanded it from
CLECs, but in this case it's the greedy little RLECs who are acting
abusively. Their rates are set to provide a certain amount of subsidy
based on their low historic traffic, which suddenly goes up by orders
of magnitude. In one case I read that an RLEC that used to get
something like $20K/yr from AT&T pumped up the traffic to $1M/month.
Adding to the fun, there are two CLECs in Iowa that set themselves up
just to join in the pumping fun, by opting into the existing high
termination rates in the areas they purport to serve. In a recent
case the Iowa state regulators found that one of the CLECs had no real
customers in their alleged service area at all and turned them off.
R's,
John
www.Queensbridge.us
wrote:
Why doesn't Google Voice charge a toll to those changes?
Even if it determined that they are a phone company, there is no law
that says that free service has to be given to all customers for all
calls.
Peter R Cook
<6a3e9b05-e67c-4291...@k19g2000yqc.googlegroups.com>,
www.Queensbridge.us <NOTv...@Queensbridge.us> writes
That would imply Google voice implemented a rating/billing
system. Given that a very significant proportion (50%?) of a
conventional telco's operating costs are associated with call data
capture, rating, billing and collection activities, it would destroy
their business model to implement such a system for a limited set of
numbers.
--
Peter R Cook
Fred Goldstein
On Nov 2, 8:44 am, "har...@hallikainen.com" <har...@hallikainen.com>
>wrote:
> > http://www.npr.org/templates/story/story.php?storyId=114341718
> >
> > ***** Moderator's Note *****
> >
> > This is a good introduction to the ways that the reciprocal
> > compensation rules can be used to benefit certain classes of
> > traffic. CLECs are incentivized to serve "receive only" lines, i.e.,
> > lines which seldom make outgoing calls, so as to tip the compensation
> > rules in their favor. Since the terminating company gets paid by the
> > IEC, CLECs with a lot of conference-call or "chat room" or other
> > customers who answer lots of calls, but make very few, can turn a
> > profit.
This isn't reciprocal compensation, which by definition is the
cost-based rate paid by local exchange carriers to each other for
local calls. It's the older, costlier Switched Access system, by
which long distance carriers pay local carriers higher-than-cost
sums, intended as a subsidy. Bigger numbers.
> > Google, which is in the awkward position of having almost all
> > "originating" traffic, must pay the higher rates which some rural
> > ILEC/CLECs are allowed to charge for terminating calls.
Or not give away the calls, which is their position.
>Why doesn't Google Voice charge a toll to those changes?
>
>Even if it determined that they are a phone company, there is no law
>that says that free service has to be given to all customers for all
>calls.
Not true. If they were a phone company, which they aren't, then
there is a rule that says that the retail price for domestic toll
calls of a given class must, in fact, be the same, regardless of the
terminating carrier. This "rate averaging" rule is why you don't
get a special bill from your normal phone company for calling these
rural areas.
Wholesale rates are, of course, a different question. The rate paid
by a bulk user to a wholesale IXC reflects cost, including access
charges. So the big carriers have lengthy rate decks for their
wholesale customers.
Google's willing to eat the fraction of a cent it costs to call most
numbers, but not the multiple cents it takes to call some rural
carriers who host conference bridges and similar services. Since
they're not a carrier, but an application provider reselling another
carrier's services, they have more flexibility than a carrier.
Dan Lanciani
> Not true. If they were a phone company, which they aren't, then
> there is a rule that says that the retail price for domestic toll
> calls of a given class must, in fact, be the same, regardless of the
> terminating carrier. This "rate averaging" rule is why you don't
> get a special bill from your normal phone company for calling these
> rural areas.
Is that different from the kind of surcharge discussed here?
Dan Lanciani
ddl@danlan.*com