WASHINGTON—CTIA dismissed plans to reform the way carriers pay each other to carry traffic because the plan was basically wireline centric, said Paul Garnett, CTIA assistant vice president of regulatory affairs. However, the wireless trade association plans to continue participating in the process to reform intercarrier compensation.
The plan, known as the Missoula Plan because negotiations began 18 months ago in that Montana town, was of no benefit to wireless, said George Reed-Dellinger of Washington Analysis, a policy research firm aimed at Wall Street.
“There is nothing in the plan that would benefit the wireless operators who will wind up paying more monies than they would prefer to the rural telecos for completing a wireless call within the rural operating territory. Wireless operators will have a portion of the access recovery mechanism added to their subscribers’ monthly bills,” said Reed-Dellinger.
Incumbent local exchange carriers have tried to create new forms of universal service, but CTIA sees no justification for them even if they are given different names like ARM, said Garnett.
“There has been an effort by the ILEC community to call additional charges on end-user bills something different, but let’s call it what it is: universal service,” said Garnett. “We have yet to see any justification for a massive increase in the universal-service fund.”
The plan is discriminatory against wireless carriers, said Garnett. In many instances wireless would pay more to wireline carriers to carry traffic than wireless carriers would pay wireless operators to carry traffic, he said.
Voting on the Missoula Plan took place last week and enough of the telecommunications industry supported the plan, which is being kept secret to allow for further negotiations, said Ray Baum of the Oregon Public Utilities Commission, chairman of the intercarrier-compensation task force of the National Association of Regulatory Utility Commissioners.
The Federal Communications Commission is examining how to overhaul the intercarrier-compensation regime. Several years ago, the Intercarrier Compensation Form presented a reform proposal that was also rejected by the wireless industry but the difference with the Missoula Plan is that it has garnered the support of rural local exchange carriers which opposed the ICF plan.
Consumer advocates also reportedly voted against the plan because the subscriber line charge that appears on telephone bills would increase.
Since the Missoula Plan has been nudged along with the help of Baum, it has been viewed as a NARUC proposal. So far NARUC has not taken a position and it is unclear whether it will before its July meeting. Baum indicated late Friday that a finalized plan would be ready to submit to the FCC within six weeks.
“I want to express my appreciation for the hard work of all of the stakeholders in negotiating and reviewing the plan and for keeping its contents confidential,” said Baum. “We encourage the stakeholders to continue their discussions with the supporters of the plan in hopes of broadening its support.”
The wireless association wants a bill-and-keep system. The “Mutually Efficient Traffic Exchange” proposal would require carriers to recover whatever costs they incur from delivering a call from an end user, not another carrier. RLECs contend that if bill-and-keep is adopted, they would lose a significant revenue source they say is necessary to keep their networks functioning.
While discussions of reforming the intercarrier-compensation regime have been going on for most of this century, Reed-Dellinger told his investors the earliest he believes any action on the reforms would not occur before next year and those would be phased in.
