WASHINGTON-To the delight of the wireless industry, the Federal Communications Commission last week declared that if and when calling-party-pays service is authorized, it will be a nationwide optional service. It is seeking comment on exactly what role states will play-particularly in protecting consumers.
The notice of proposed rule making seeks to bolster the information the FCC has on CPP. The FCC expects to make a final decision on CPP early next year, said Thomas Sugrue, chief of the FCC’s Wireless Telecommunications Bureau.
The declaratory ruling on the jurisdictional status of CPP is a win for the industry. State regulators had urged the FCC to re-think the decision as late as June 3-the last day lobbying on CPP was allowed before the FCC’s Open Meeting on June 10.
Thomas Wheeler, president of the Cellular Telecommunications Industry Association, said the industry had FCC Chairman William Kennard to thank for the declaratory ruling. “I think we have to give a ton of credit to Bill Kennard on that decision. Calling party pays would not happen if it was subject to 50 states … it was his leadership that allowed this to happen,” Wheeler said.
Bell Atlantic Mobile agreed. “The leadership of Chairman Kennard and the commissioners on calling party pays is a giant step forward for wireless consumers … CPP will make wireless immediately more valuable for current consumers, more affordable to those who do not yet have wireless and more competitive with landline service,” said Dennis F. Strigl, president of Bell Atlantic’s Wireless Group and BAM CEO. BAM had requested the declaratory ruling. The carrier expects to begin offering CPP by the end of the year.
The NPRM will examine a variety of issues, including notification and billing issues, and seeks comment on whether market conditions are likely to exert competitive pressure on rates charged to calling parties on CPP calls.
FCC Commissioner Harold Furchtgott-Roth opposed the FCC examining what would be considered reasonable rates for the person calling the wireless subscriber. Furchtgott-Roth said that such examination could lead to unnecessary regulation.
“There is one area where there may be regulation,” Furchtgott-Roth said, and then he whispered the two words, “rate regulation. This industry has thrived because carriers did not have rate regulation … I find even raising the issue in light of the competition report totally irresponsible.”
This examination was apparently prompted by FCC Commissioner Susan Ness, who said she was concerned about the calling party being gouged.
“I hope commenting parties will address the question of how competition will constrain the charges imposed on calling parties. As we noted in the Access Reform docket, the ability to terminate a call is not necessarily subject to the same competitive pressures as originating access can be. Indeed, after investigating the charges imposed on wireline calling parties, [the Office of Telecommunications (the regulatory body in the United Kingdom)] ordered a 25-percent reduction in the prices that were charged consumers to terminate a call on a wireless carrier,” Ness said.
Furchtgott-Roth also was concerned about the FCC asking questions regarding whether billing for CPP would be considered an unbundled network element. The FCC is examining its policy regarding UNEs as part of a remand from the Supreme Court. Furchtgott-Roth believes the FCC has been approaching the issue in a piecemeal fashion, attaching UNE elements to a variety of items instead of handling them comprehensively. Sugrue believes asking the questions in the NPRM is acceptable because the FCC will not act on CPP before it acts on the remand proceeding.
“We propose to apply whatever standard from the UNE standard. We won’t act on this until that is adopted. [Furchtgott-Roth] is uncomfortable teeing up issues until it is decided by the [FCC]. We think we can tee it up provided we don’t act” before the UNE proceeding is complete, Sugrue said.
CTIA had asked the FCC in October 1997 to allow calling party pays, but the industry has been split in its support of the feature. Late last year, the CTIA Board of Directors sent a letter supporting CPP, which pushed the issue forward again and prompted Kennard to support the concept at the CTIA trade show in February.
Division in the industry appeared again last week when BellSouth said it does not oppose CPP as an optional service but questioned the billing procedures and their impact on landline consumers. “We don’t think it is rational to expect our wireline customers to help pay for an elaborate and expensive billing and collection system that we may be required to offer to wireless companies, especially if there is no real demand for it,” said Ben Almond, BellSouth’s federal regulatory vice president.
While BellSouth questioned the billing and collection arrangement, Jay Kitchen, president of the Personal Communications Industry Association, said these arrangements are crucial to the nationwide CPP implementation.
