Jim Allard <jim@equi.com> (06/20/91)
Since my favorite UNIX afficionado introduced me to the Digest a few
months ago, I have been quietly sitting in the background reading the
various utterings of respondents, as AOSs and COCOTs in general have
been heavily smacked around. While I will agree there are some
unethical providers out there, some of us have made a serious effort
to provide services which attempt to validate the reasons for the MFJ
-- competition. I offer some thoughts of my own as an attempt to
balance the picture a bit:
Let me begin by clearly stating I would do many of the same things
AT&T has done post-divestiture, in an effort to protect my customer
base. Great credit must be given to AT&T and the Bell Labs for the
technology which allows much of what we do on a daily basis. No one
is more impressed with their R&D capabilities than I. Let's not lose
sight of the fact that much of that technology was paid for by you and
me in over 100 years of a regulated, telecommunications monopoly (with
guaranteed rates of return). Not to mention the built-in customer
base.
1. Hasn't anyone noticed that AT&T LD rates have dropped dramatically
since divestiture? Does anyone really believe they (AT&T) would have
done that on their own? If you had a monopoly, would you? Wake up
and smell the coffee ... competition among other things have been
responsible for more realistic pricing in the LD market. There has
also been an increase in charges for local service (not necessarily
corresponding but understandable).
2. Anyone who believes there is anything close to a "level playing
field" should sit with my operators when someone needs international
directory assistance, collect overseas calls and/or connection to
non-direct dial countries. No one can do these things except big
momma, and she isn't interested in sharing, (not that I blame her).
There is a definite advantage on AT&Ts side when these and other
services are required. I'd love to have one day's worth of their
advertising dollars.
I won't bother to discuss the huge differences in what network costs
us compared to the "in place" net AT&T has available (paid for by rate
payers during the 100+ years they've been around).
3. Every public IXC except AT&T provides 800 or 950 access to their
network as a convenience to their customers. AT&T steadfastly sticks
to 10XXX as the ONLY means for non-subscribed customer access (or
access by their customers from non-AT&T phones). If you owned 200
switches at your hotel chain, would you give guests unrestricted fraud
potential?
Fact is, it cost us $1500 per switch to allow guests full AT&T
capability with fraud protection. We spent the money because some of
our clients' guests like AT&T ... go figure, but we believe in
service. Interestingly, only 5% of our AOS customers ask for other
carriers, a percentage of that for AT&T. We carefully provide
instructions for access to the caller's carrier of choice and various
other alternative billing methods. 95% of our callers CHOOSE to use
us. And yes, we clearly brand our service at the beginning and end of
our involvement (which we've been doing since well before it was law).
This based on two years of handling greater than 400,000 calls per
month.
4. This business of an AOS connecting callers to the AT&T network is
a joke. While we can technologically do so, they refuse to take the
call, claiming possible fraud and high error concerns as some of their
reasoning. It would be a nice service to 'their' customers, and we
would have to pay origination charges for the entire length of the
call. Their position reminds me of the kid who takes his ball and
goes home if you don't want to play by his rules.
5. My company DOES NOT apply any additional surcharges to calls we
handle, even though it's legal in many states and for interstate
traffic. The same stipulation is in every contract we write. Our
rates mirror AT&T's. We guarantee not to charge more than their
standard time-of-day discounted rates. In fact, our billing programs
round down (not up) to ensure compliance with the policy. Yes, we
also issue immediate credit for mis-dialed calls.
6. Until recently (introduction of AT&T's 'new' CIID calling card)
there was a major misconception in the minds of the public regarding
whose card they had in their hand. There are millions of
pre-divestiture calling cards out there with AT&T logos, really issued
for the LECs as shared cards. Callers erroneously believe they have
AT&T cards. You'll notice they didn't rush to change that 'shared
card' perception. AT&T's announced intent is to convert "it's"
millions of cards to CIID format by the end of 1991. I for one am
very happy about the change.
I can't wait to see what will happen when those new card holders
find the card no longer works at the hotel/airport/hospital of their
choice. This could be the best thing that ever happened to AOS. These
callers will soon realize they can get greater flexibility with cards
issued by their LEC. They can still use the AT&T network if they want to
dial 10288, but my suspicion is they won't want to dial the extra digits.
Brand loyalty is great, but most people will default to what is
easiest and fastest if the cost and services provided are comparable.
I wouldn't throw out my line ID (LEC) card with the comfortable pin
just yet. Ohio Bell is making major inroads in the calling card
business using just that approach " ... card is accepted by virtually
every long distance carrier." Regardless of the belief (and I agree)
that 10XXX dialing should be available, reality is that it is not.
Is AT&T deliberately designing a card system which will create serious
customer dissatisfaction in an effort to pressure aggregators into
presubscribing to AT&T? I don't think the last legal shot has been
fired on this issue and I hope the public isn't that gullible.
I sincerely hope this does not come off sounding like a whining
step-child. We expect to be successful or fail on our own merits. If
we can provide the service at reasonable costs to the calling public,
on a level playing field, I say let the market determine the winners
and losers. Keep the politicians out of it, or we'll end up with
three LD phone companies about five years from now. That's not what I
call choice, and the playing field is far from level.
James H. Allard, Jr., Director Operator Services
Equicom Communications, Inc.
[Moderator's Note: Thank you for sending along a most interesting
alternative viewpoint regarding AOS'. I appreciate having you as a
reader. PAT]Robert Jacobson <cyberoid@milton.u.washington.edu> (06/21/91)
Having been an alternative IXC customer in the past, I have to say that the service was great and the prices right. But these days seem to be passing as pressure on the independent's becomes tremendous. The politicians get in because they're invited in by one party or another. Exhorting the public (some would say, the masses) to "keep the politicians out" is good rhetoric but ignores the fact that it's probably a carrier who's inviting them in. Who that might be is your best guess. This all goes to show that the market works imperfectly. With or without public intervention, it seems we're on our way back to monopoly or, at best oligopoly/duopoly. History calls. Bob Jacobson
"Fred R. Goldstein" <goldstein@delni.enet.dec.com> (06/22/91)
In article <telecom11.473.6@eecs.nwu.edu>, jim@equi.com (Jim Allard) writes.: > Since my favorite UNIX afficionado introduced me to the Digest a few > months ago, I have been quietly sitting in the background reading the > various utterings of respondents, as AOSs and COCOTs in general have > been heavily smacked around. While I will agree there are some > unethical providers out there, some of us have made a serious effort > to provide services which attempt to validate the reasons for the MFJ > -- competition. ... Mr. Allard has a disingenuous but ultimately specious defense of his so-called "industry". Beginning with his motherhood and apple pie defense of "competition" (who's disputing that?), he then claims that because his company is doing something apparently in competition with AT&T, he must be good. Hogwash. Speaking as a diehard anti-monopolist who has taken the strong position that "divestiture" was a Good Thing (and disagreeing with the Moderator quite openly, to be sure), I still see no excuse for the AOS/COCOT business to exist. They're bottom-feeding scum whose very existence is no more than an unhappy accident. Fact: Nobody in "power" EVER planned on the COCOT/AOS situation. It was an accident caused by the confluence of several different legal and regulatory events. If it were chemistry, it would be the creature from the Toxic Lagoon, one of those unhappy reactions. Event 1: COCOTs. This was planned. Back in 1977, the FCC Registration program (Part 68) specifically excluded pay phones. At the time, the only pay phones were the CO-controlled kind; mucking with those lines could have caused mis-billing, fraud, etc. No problem. But then somebody invented a new kind of pay phone that ran on a standard line. Was it allowed? The FCC recognized the rationale behind the original pay phone exemption and allowed registation of the COCOT. That was purely a technical issue. Event 2: Resale. This was planned. Back in the '70s, the FCC allowed resale carriers to operate under license; later, the license requirement was dropped. Anybody could resell anything. At any price. This was fine; the telco still got the money from the original supplier and if somebody chose to buy from a reseller, that's their business. This has recently begun in Canada, btw. Reselling is a cheap way to pretend to be an LD carrier. Event 3: Divestiture. This caused the LECs (RBOCs et al) to adopt an arms-length relationship from LD carriers. So they had to accept billing requests from any and all LD comers, if they were to continue to bill for AT&T. Now with anybody allowed to put anything on a phone bill, bottom feeders moved in. They got aggregators and COCOTs to force calls throgh themselves. They charged outrageous, unregulated rates. They gave lousy service. But it was all legal, since reselling was allowed and resellers were, like carriers, allowed to buy LEC billing services. Maybe, just maybe, Mr. Allard's company does't overcharge the way 99.44% of AOSs do. But when I travel on business with my AT&T SDN card, I don't expect to have to pay out of pocket to the hotel what normally gets direct-billed via our Tariff 12 agreement. I don't want to have to argue with the poor underpaid sweatshop operators about my right to be connected to AT&T (though I often do, and I NEVER let the AOS get my money). If we had a responsible FCC that required resellers to file arguable tariffs, and required phones to offer the actual callers a choice of carrier, that's fine. But making "captive" callers use some company, that exists only because of loopholes in the law, is not going to win my sympathy. Fred R. Goldstein Digital Equipment Corp., Littleton MA goldstein@delni.enet.dec.com voice: +1 508 952 3274 <insert standard disclaimer>
john@mojave.ati.com (John Higdon) (06/23/91)
Robert Jacobson <cyberoid@milton.u.washington.edu> writes: > This all goes to show that the market works imperfectly. With or > without public intervention, it seems we're on our way back to > monopoly or, at best oligopoly/duopoly. Perhaps, because in this particular business, that is the natural order of things. The "market" can only function where there is informed, unrestriced choice by the consumer. In the case of AOS, the customer is neither informed (usually by design of the AOS), nor does he always have a choice. Also remember that an AOS is NOT a long distance company. It is a reseller. Some of them claim to be "value added" resellers, but none of them own any networks. Some of them, such as Telesphere, may have a leased network (no actual ownership), but most simply route over a major carrier's facility. The original poster complained that without a level playing field we would have only three long distance companies in a few years. If you consider ownership of the network a requirement for being a long distance company, then that is virtually true now. The rest (including the original poster's company) are, as Mr. Goldstein put it, bottom feeders. John Higdon <john@zygot.ati.com> (hiding out in the desert)
wright@ais.org (Carl Wright) (06/25/91)
I'm sorry, Fred. Either you want to appeal to my prejudices by calling AOS's names (bottom feeders, etc.) or you want to appeal to my logic (AOS's were never intended to happen, etc.). I don't buy it. Let's hear it for bottom feeders. Carl Wright | Lynn-Arthur Associates, Inc. Internet: wright@ais.org | 2350 Green Rd., #160 Voice: 1 313 995 5590 EST | Ann Arbor, MI 48105