Campaign To Reform Phone Access Charges Formed
August 24, 1998
MADISON, WISCONSIN, U.S.A., Newsbytes via
NewsEdge Corporation : A consumer and business
group has been formed to campaignfor a fairer deal for
telephone users, specifically in the area of charges that
LECs (local exchange carriers) make to long distance
companies for access to their services.
According to the group, local phone companies are
overcharging long distance carriers with inflated
connection fees, referred to as access charges. The
bottom line, the group says, is that these charges cost
over $37 million a year in Wisconsin alone.
The Campaign for Fair Phone Charges (CFPC) says that
firms such as Ameritech and GTE charge more than two
cents per minute to long distance carriers, just to make
the connection to their local phone networks, when their
actual cost is only a fraction of this amount,
The CFPC says it intends to seek legislation to require
local exchange companies to offer access at non
discriminatory rates -- not more than what they charge
each other for the same service. This rate, the group
says, is called the interconnection rate and averages
about one cent per minute.
"This is an overcharge to the consumer and it cries out
for action," said Steve Hiniker, executive director of the
Citizens Utility Board (CUB), a member of the campaign.
"Our members represent main street business in
Wisconsin and we believe local exchange companies are
overcharging for an essential service. These access
charges must be reduced," said Chris Tackett, president
of the Wisconsin Merchants Federation.
According to CFPC, some local exchange companies
charge long distance companies over 10 cents per
minute in Wisconsin for access to their local networks.
The campaign estimates that if access charges are
reduced to the interconnection rate, a penny a minute --
the actual cost is about a half-cent per minute -- long
distance bills may be cut by 20 percent.
Besides CUB, members of the campaign are the
Wisconsin Merchants Federation (WMF), and long
distance carriers such as AT&T, Sprint, MRC/Norlight,
and TCC Powercom.
According to the campaign, long distance rates have
dropped dramatically in the last 14 years, by more than
50 percent, and far more than the late blooming shaving
of some access charges by the local exchange
companies as they saw the reform move coming.
"We know that competition is the way to keep costs
down, and that has been demonstrated over and over
again by what's happened in the long distance market,"
said Jim Leonhart, a senior AT&T official in Wisconsin.
"But competition has not happened in the local
exchange market where companies like Ameritech have a
monopoly on local service and continue outmoded
practices of the past that result in over $37 million in
unnecessary charges, " he explained.
Reported by Newsbytes News Network,
newsbytes.com .
(19980821/Press Contact: Eileen Doherty, Sprint
202-828-7423; Steve Hiniker, CUB 608-251-3322; Jim
Leonhart, AT&T, 608-259-2218; Chris Tackett of WMF
608-257- 2431/WIRES TELECOM/)
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