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Tele-Tech Updates

July 2014


FCC Wins Court Battle over ICC Reform, but Leaves Some Power with State Commissions   

by Kim Russo, Co-President

The U.S. Court of Appeals for the Tenth Circuit upheld the FCC's 2011 reform for the Universal Service Fund and Intercarrier Compensation System.  The decision is a blow to incumbents and CLECs who were hoping to retain the ability to collect revenue when terminating calls on their networks from other carriers.

What Does the Decision Mean for ICC?
While several changes urged by rural telcos and their representatives have been incorporated into USF reform, there remain concerns among incumbents and competitors alike on ICC reform and the "bill-and-keep" methodology that puts intercarrier compensation rates at zero.

Although the Appellate Court upheld the bill-and-keep methodology, it left authority over the terms and conditions of reciprocal compensation to state commissions.  The Court also ruled that the state commissions will continue to define the edges of networks, even if there is no compensation for the exchange of traffic at those edges. In essence, the states are left to decide where the zero rate applies.  In an email to members, NTCA Senior Vice President of Policy, Michael Romano, analogizes the situation as follows:

"Let's say someone (the Federal Shipping Commission) suddenly mandates that an overnight shipping service like UPS or FedEx must deliver all packages in the the U.S. for free.  That sounds like a burden, right?...But say that the 'terms and conditions' of delivery are defined by each state such that the obligations for UPS start and end within one mile of the ultimate destination of each package. So you want that package to go to Dallas? Sure, FedEx can take it there, and they'll even do it for free because they have to--but you will have to get it to the outskirts of Dallas (per the Texas Shipping Commission) to get that zero rate.  If you want to hand it off somewhere other than Dallas, well, that'll cost you."

So, while the Court says carriers have to terminate calls for free, the states have the authority to decide where free starts.

The NTCA, in a statement from President Shirley Bloomfield, promises to continue to address the issues surrounding ICC reform through engagement with the FCC and Congress.

Current ICC Discussions at FCC
That continued engagement has already begun. NTCA, Frontier, ITTA, and Windstream met with FCC staff in June to discuss ICC reform.  The group pointed out that the USF and ICC reforms are closely tied together and were intended to be coordinated.  But the two are no longer proceeding at the same pace.  The group suggested that the ICC rates remain at their current level, rather than continuing with scheduled reductions, until USF reforms are completed and implemented.  The group noted that the rate reductions scheduled to take effect July 1st would come without the expected recovery mechanisms or other sources of USF support.

If the Commission does not take action by July 1, 2014, price cap carriers and CLECs that benchmark access rates to price cap carriers will be required to reduce terminating switched end office and reciprocal compensation rates by one-third of the differential between end office rates and $0.0007.  Rate-of-return carriers and CLECs that benchmark access rates to rate-of-return carriers will be required to reduce terminating switched end office and reciprocal compensation rates by one-third of the differential between end office rates and $0.005. 

Additional Fields/Customization Available through Tele-Tech

NPA/NXX Data, Local Calling Areas, Rate Tables -- Most Tele-Tech clients get our off-the-shelf versions of these data sets.  But did you know that Tele-Tech has a staff of developers that can customize your data feed to include additional fields?

Tele-Tech has always accommodated special requests from our clients to add additional data to our standard formats. Once added, those "custom" fields are available to all clients.

Some fields currently available include:

  • Incumbent LEC for each rate center
  • Rural vs. non-Rural OCNs 
  • Zip codes by NPA-NXX
  • Latitude and Longitude of NPA-NXXs
  • Time Zone of NPA-NXXs
  • Number of access lines by rate center
  • OCN type
  • Thousand-block (NPA-NXX-X)

Don't see what you're looking for?  Just ask! Contact Kim Russo at 843.879.5030 or krusso@kfrservices.com

FCC Releases
The FCC released its latest reports on Internet Access Services and Local Telephone Competition. The semi-annual reports, released June 25, 2014, cover data collected by the FCC through June 30, 2013.

Highlights include:
  • The number of internet connections with downstream speeds of at least 10 Mbps increased by 118% over June 2012, to 103 million connections, including 58 million fixed connections and 45 million mobile connections.
  • The number of mobile Internet subscriptions with speeds over 200 kbps in a least one direction grew to 181 million - up 18% from June 2012.
  • In voice services, there were 90 million end-user switched access lines in service, 45 million interconnected VoIP subscriptions, and 306 million mobile voice subscriptions.
  • Between June 2010 and June 2013, interconnected VoIP subscriptions increased at a compound growth rate of 16%, mobile voice subscriptions increased at a compound annual growth rate of 3%, and retail switched access rates declined at 10% per year.

Read the full reports here.

NANPA Q2 Recap


NPA 548 to overlay NPA 226/519; June 4, 2015.

Q3 Contribution Factor 

The proposed Universal Service Fund contribution factor for Third Quarter 2014 is 15.7%, down from 16.6% in the previous quarter.
KFR News