WASHINGTON-The Federal Communications Commission on Thursday passed on telling wireless carriers whether wireline carriers can file tariffs at the state level for termination without first negotiating with them.
“The FCC’s failure to decide these petitions robs consumers in the very markets that would benefit most from additional competition. Each FCC commissioner and many members of Congress have on multiple occasions asked what could be done to improve service to rural consumers. Acting favorably would be a significant step towards that goal,” said CTIA President Steve Largent. “How can the FCC have any hope of reforming a hopelessly broken intercarrier compensation system if it cannot even restate long-settled FCC rules that have been repeatedly upheld by the court?”
The FCC had been widely expected to rule on two long-standing-more than two years’ old-petitions from the wireless industry regarding interconnection issues. The rulings were to come as part of a larger item seeking comment on how carriers pay each other to carry traffic.
Instead the FCC punted on the wireless issues and asked neutral questions about intercarrier compensation. FCC Chairman Michael Powell said the reason was the rural lobby.
Rural carriers were pleased with the FCC’s action.
Intercarrier compensation comes in two forms: access charges for long-distance calls and reciprocal compensation for local calls. Rural local exchange carriers rely heavily on access charges as a major revenue source. The other major source of revenue for RLECs is universal service. The FCC is also considering changes to the universal-service system. It is unclear whether intercarrier compensation can be changed without changes to universal service and vice versa. Universal-service subsidies and access charges are under increasing pressure as telecom evolves from a circuit-switched wired world to one where calls are connected without wires and without switches, and the distinction between local and long distance is shrinking.
The wireless industry has long favored a bill-and-keep regime where carriers would choose the best way to terminate a call and then bill their customers for it.
The FCC staff prepared a report analyzing bill-and-keep, but the FCC is not officially seeking comment on the report.
