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You'll recall our inquiry of the Florida Public Service Commission regarding the monthly In State Connection Fee of $1.95 by AT&T effective July 15, 2001 and other telecommunication concerns sent to Senator Bob Graham. We received a reply from both, included in this dispatch. * SEE BELOW * Since you already know the reasons AT&T is providing customers for this charge we won't repeat that part of the response from the PSC. However, we've chosen specific and interesting unaltered statements from the regulatory specialist. Senator Bob Graham's response follows. The best to you and yours,
"Because of the complicated nature of long distance markets, PSC authority over this charge is limited." "Although the long distance market is open to competition and the marketplace sets the prices for long distance services, the PSC is researching what authority it might have over this charge." "PSC customers who object to paying the charge do have some options that they may pursue, although the PSC cannot endorse any particular option. The options include the following: * Customers may shop around for a long
distance company whose rates, charges and services more closely match their
budget and/or calling patterns:
"While the PSC understand your concern, please understand that the telecommunications marketplace still is evolving into one in which market forces, rather than government regulation, sets prices and the level of service that customers will accept." "If you have any questions, please contact
us at 1-800-342-3552, by toll-free fax at 1-800-511-0809, or by e-mail
at [email protected]
Thank you for contacting my office regarding consumer telephone charges. Since the creation of the Federal Communications Commission (FCC) in the 1930's, the agency's goal has been to provide telephone service to all households that desire to have it. In order to achieve this goal, the FCC charged companies within the private telephone industry, such as AT&T, for the support programs which were needed to provide telephone service to high cost areas. In an effort to answer concerns regarding the break up of large telecommunications companies in the 1980's, such as AT&T, Congress passed the Telecommunications Act of 1996 (P.L.104-104). As a result of this Act, the costs for these charges were distributed to all carriers who provide telephone service, including long distance companies, cellular telephone companies and local phone companies. Under the Act, all telecommunications companies are given the option of either passing these costs on to the consumer by way of their monthly phone bill or simply paying these charges themselves. The FCC does not require telecommunications companies who contribute to universal service to pass these charges on to the consumer. Rather, the FCC, and Congress, allow these telecommunications carriers to decide how best to cover the cost of these Universal Service Charges. Those companies which have chosen to pass these costs on to the consumer have added a new "universal service fee" of 4.4 to 5.4 percent to the billing statement of each consumer in order to recover these fees. The FCC recommends that consumers contact their telecommunications carrier if they believe these fees are inappropriate. In addition, the FCC recommends that consumers research which companies pass these charges on to the consumer and which ones simply pay these service fees themselves. Information, as well as other recommendations regarding this issue, can be obtained by accessing the FCC website at (http://www.fcc.gov/) or by writing to the FCC at: Federal Communications Commission
I appreciate you sharing your views with me on this issue. Please be assured that I will have your thoughts in mind should this issue be brought before the full Senate for review. I look forward to hearing from you on this
issue, as well as other matters, in the future.
As our recent dispatches have indicated we've been seeking answers concerning the $1.95 monthly fee being charged by AT&T for in-state long distance telephone calls and an increase of 1.6 % SPRINT intends to impose on telephone service effective September 1, 2001. Although we haven't received a written response from the Florida Public Service commission, we have received the following provocative response from Floridians For Fairness, Inc. which indicates how unregulated business is conducted. Thanks very much for the response, John. * SEE BELOW * The best to you and yours,
The AT&T charge you are refering to is to cover the costs of access fees they have to pay the local carriers to use their lines. This fee, in the past, was buried in the bill and they have decided to let the consumers see what they have been paying for years in an access fee. Access Fee is a charge paid by the long distance company to rent the network owned by the local exchange company (Sprint, BellSouth, Verizon) which turns out to be the phone line from one of the network boxes to your house. This section of the network costs under 1 Penney per minute to install and maintain but in Florida Sprint charges over 10 cents, Verizon over 8 cents and BellSouth over 4 cents. This charge is paid per minute the long distance company consumer uses the phone line. Before, this charge was wrapped up in the fees charged but most of the long distance companies have started to let the consumer know of this extra fee. The 1.95 is far less than it would cost for a normal long distance consumer because we did research last year to show the savings would be around 17 dollars a month if Verizon and Sprint were brought down to Bellsouth's position. So this is not a new fee just one most did not know about. Second, the rise in prices of Sprint. The local telephone companies have been under a five year freeze for local telephone charges set by the PSC in 1997 when they reduced the access fees and changed how the phone companies are regulated. Before 1997 the telephone companies were regulated by profit margins. The PSC would look at the books and see how much they were making and then decided to raise or lower their prices. However, now the telephone companies are regulated by the legislature and their books are closed. This change was done with reduction of access charges and the PSC was fearful the companies would raise local rates. Well their fear was right and each of the three have raised or filed petitions to raise their local rates. Under current law without going to the legislature the companies can raise their rates 1.6% each year which was considered to be for inflation. More then this, they would have to get a bill through the legislature and signed by the governor. This increase is legal and probably will happen each year. It is like give someone a inch and they will try and take a mile. The solution would be greater competition so each company would be regulated by the market and not any government. However, we do not have this in place so current good business practice would be do what the maximum allows to increase profits. We believe that this should be reduced through true competition in the local telephone market and ISP market. Thanks for the email and let me know if I can assist you in any way. I hope I made some sense here because this issue of telecommunications can be somewhat confusing. Take care. |
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