[comp.dcom.telecom] US Long Distance Billing Scheme is a Crock

ceb@csli.stanford.edu (Charles Buckley) (07/29/90)

In article <10082@accuvax.nwu.edu> robertsn@iosg.enet.dec.com (Nigel
Roberts 0860 578600) writes:

>One thing that does seem much more difficult than I'd expected is
>obtaining a U.S calling card (e.g. AT&T, Sprint, MCI).

><details on felt-covered brick wall treatment by issuers of US
>phone credit cards deleted>

Practically every other country in the world I've been to bills long
distance calls for a fixed unit price (about a nickel) for a variable
unit of time (unlimited down to a second or so), instead of the US
scheme whereby a fixed unit of time (a minute) is billed at a variable
price (free up to several dollars).

The former, most popular scheme makes it possible:

1. to have telephones which receive pulses and count how much the
   call costs (so you can reimburse your host for it on the spot if
   appropriate), which eliminates the need for itemized monthly billing,

2. to have inexpensive pay phones which accept fixed price debit
   cards that are debitted for the call (according to the number of 
   pulses received), allowing you to telephone as easily as from home,

3. to make a short, 10 second call for a low price, therefore, to a far
   away place, just to say "Hi, this is <x>, please call me back on
   pay station <y>", which eliminates the need for most collect calls,

4. to largely dispense with huge, complex, error-prone, fraud-prone
   billing networks which funnel call charges, yours and the last four
   guys who overheard your credit card number, each with hefty 
   calling-card or operator billing surcharges which average (for me)
   30% of the price of each call, back to your monthly bill, which (in
   Cal.) you have to pay every month by check, and can't have debitted
   from your bank account automatically, and

5. last but not least, to avoid the problems Mr. Roberts
   complains about.  When was the last time any 'red-blooded American'
   tried to make an international call using coins?  You get the
   automated voice saying "Deposit ten dollars and 30 cents, please,
   for three minutes", which leaves you just stunned, staring at a coin
   slot which takes nickels, dimes, and quarters.  After asking at the
   next store for ten dollars worth of quarters (if you're lucky
   enough to find one around which is open) and getting your head
   bitten off ("We're not a bank, you know!".  No kidding.), you tends
   to give up, and the impression of telephoning in the US as being 
   similar to telephoning in Baghdad has just been validated.

WHY, WHY, WHY is the United States still mainly dependent on a system
which has so many procedural liabilities built into it???

Agreed, the telecom employees who are stuck with providing service
amid these obstacles do about as good job as can be expected, but they
also do a good job insulating those who employ them from just how
ineptly conceived things are, which means that things remain the same,
and will likely do so for a long time to come.

Agreed, when telephoning from home, it is *much* cheaper in the US
than most other places I know, but that doesn't legitimize resting on
one's laurels and not further reducing overhead.  Surely there must be
better ways of generating employment than artifically maintaining a
need for large numbers of clerks and phone answerers who have ample
opportunity to perfect their technique at putting you on hold.  Surely
corporate planners and strategists would be relieved not to have to
worry about taking into account a large billing apparatus in their
plans.

Other countries with a far smaller market and far less capital have
managed to put in place better solutions.  As I see it, the regulatory
agencies of the US and the utilities which lead them around by the
nose (until the agencies get fed up and balk) have no excuse on this
one, and should take corrective measures forthwith.  That is, if
regulatory agencies still know how to do anything other than give
utilities a symbolic hard time before finally giving in.

Now is an especially good time to do it, since one sees evidence that
the nation's coin station stock will be largely changed out over the
next few years.  The new models I've seen can read bank cards or phone
company credit cards (as if anyone actually carried the latter
around), but don't tell you how much the call in progress costs.  You
still have to pay the huge surcharge.

Can't we do better than this?  I wouldn't at all mind continuing to
pay the surcharges, if I knew the proceeds were going to finance
putting in place a more flexible system such as the one I've
described, which would no longer make such surcharges necessary.

john@bovine.ati.com (John Higdon) (07/30/90)

Charles Buckley <ceb@csli.stanford.edu> writes:

[a complete and informative description of the commonly used method
for billing in other countries]

There are two major problems with adopting this appoach without
modifications.

First is the pulses themselves. All that I have heard indicates that
they sometimes cause problems with modems. My system transfers much
data to Japan (who uses pulses) and there appears to be no problem,
but I have heard stories to the contrary.

Second is the lack of detailed billing. Given the potential for error
in ANY billing system, how can you justify receiving a bill for "X
units -- Total Y Dollars"? No detail; no way to track down errors. I
doubt that US residents would be willing to lose the detail that
appears on the bill.

It's bad enough that Pac*Bell bills local calls in this manner, but it
would be unthinkable to receive an invoice for, say $300.00 and no
detail on it whatsoever. (This IS what they do in Japan; in fact the
phone company just takes it out of your bank account!) How neat and
simple :-(.

> The former, most popular scheme makes it possible:

> 1. to have telephones which receive pulses and count how much the
>    call costs (so you can reimburse your host for it on the spot if
>    appropriate), which eliminates the need for itemized monthly billing,

See the above caveat about modem use.

> 3. to make a short, 10 second call for a low price, therefore, to a far
>    away place, just to say "Hi, this is <x>, please call me back on
>    pay station <y>", which eliminates the need for most collect calls,

You have answered your own question. The prime concern of American
business is not involved with saving you money. A tradition in this
country seems to be, "If you make the call from anywhere other than
your own, personal phone, it will cost you more money."

> 4. to largely dispense with huge, complex, error-prone, fraud-prone
>    billing networks which funnel call charges,

I fear that with non-detailed billing you might simply have the
illusion that you had dispensed with "huge, complex, error-prone,
fraud-prone billing networks" since you would have no way of knowing
if this was indeed the case. With no billing info, how would you know?

I agree that simplified (and cheaper) coin service would be a real
plus. The system of "debit cards" for payphones in other countries is
quite attractive.

> Now is an especially good time to do it, since one sees evidence that
> the nation's coin station stock will be largely changed out over the
> next few years.  The new models I've seen can read bank cards or phone
> company credit cards (as if anyone actually carried the latter
> around), but don't tell you how much the call in progress costs.  You
> still have to pay the huge surcharge.

Devil's advocate time. Phones that read credit cards, handle alternate
billing, etc., cost real money. The surcharge is what pays for this.
If you don't use that form of billing, why should you pay? If you do,
who should pick up the cost if it isn't you via the surcharge?
Alternate bill DOES cost more. The only alternative to collecting that
cost from the immediate user is to spread it over all users. Is that
fair?

> Can't we do better than this?  I wouldn't at all mind continuing to
> pay the surcharges, if I knew the proceeds were going to finance
> putting in place a more flexible system such as the one I've
> described, which would no longer make such surcharges necessary.

Agreed. But do you really want our "regulators" to come up with the
new plans? Can you name a situation when this hasn't resulted in some
sort of debacle? Our billing system could use many improvements, but
from past experience, I would suggest great caution. It really does
matter who makes the changes and how they are made. There is a bit of
a conflict here. Any system that dispenses with call detail is
unacceptable. Any system that retains detail and offers alternative
billing arrangements will cost more to record calls billed in that
manner. You can't get something for nothing.


        John Higdon         |   P. O. Box 7648   |   +1 408 723 1395
    john@bovine.ati.com     | San Jose, CA 95150 |       M o o !

ken@sharkey.cc.umich.edu (Ken Jongsma) (07/30/90)

I just had to respond to this post, I'm sure there will be many
others.  While the poster makes some valid points, I think overall,
the US plan is much easier to understand *and verify.* (I've used both
the meter and the US (really North American) systems.)

It's much easier to understand that a call costs x cents a minute and
see it show up that way on your bill. I believe the vast majority of
long distance calls are billed to a credit card these days, or at
least a third number. Having a meter based system just for coin calls
when home and businesses receive time based calls would not make a lot
of sense either.


Ken Jongsma                 ken@wybbs.mi.org
Smiths Industries           ken%wybbs@sharkey.umich.edu
Grand Rapids, Michigan      ..sharkey.cc.umich.edu!wybbs!ken 

david@cs.uow.edu.au (David E A Wilson) (07/30/90)

john@bovine.ati.com (John Higdon) writes:	[the > indented bits]
>Charles Buckley <ceb@csli.stanford.edu> writes:[the >> indented bits]

>First is the pulses themselves. All that I have heard indicates that
>they sometimes cause problems with modems. My system transfers much
>data to Japan (who uses pulses) and there appears to be no problem,
>but I have heard stories to the contrary.

Australia uses the pulse counting method as well - I haven't
experienced any problems with my modems. I understand that they are
only present on a regular phone line if you pay Telecom to install a
counter at your end of the line (which cannot be used to argue your
bill).

>Second is the lack of detailed billing. Given the potential for error
>in ANY billing system, how can you justify receiving a bill for "X
>units -- Total Y Dollars"? No detail; no way to track down errors. I
>doubt that US residents would be willing to lose the detail that
>appears on the bill.

We never had detailed billing (what you never had, you don't miss?).
We are now just starting to get it on international calls (free) and
trunk calls (if you pay extra - but when exchanges are upgraded it
will become free).

You do normally get the international calls totalled separately even
with older exchanges.

>> 3. to make a short, 10 second call for a low price, therefore, to a far
>>    away place, just to say "Hi, this is <x>, please call me back on
>>    pay station <y>", which eliminates the need for most collect calls,

We have this type of payphone - Sydney to Perth ( >745 km) at the most
expensive time of day will cost you 30c for each 22 seconds.


David Wilson	david@wraith.cs.uow.edu.au

mk59200@uikku.tut.fi (Kolkka Markku Olavi) (07/30/90)

In article <10218@accuvax.nwu.edu>, john@bovine.ati.com (John Higdon) writes:

|> There are two major problems with adopting this appoach without
|> modifications.

|> First is the pulses themselves. All that I have heard indicates that
|> they sometimes cause problems with modems.

The billing pulses aren't normally transmitted to your phone, they are
part of the CO signalling.  If you want the device that shows the
price of each call, the pulses are connected to your line, but this
obviously isn't a good idea with a line used for a modem.

|> Second is the lack of detailed billing. Given the potential for error
|> in ANY billing system, how can you justify receiving a bill for "X
|> units -- Total Y Dollars"? No detail; no way to track down errors.

This isn't a problem with modern equipment, if you want more detail,
just ask for it.  In the old electromechanical switches the pulses
were counted with a simple odometer-style counter, which didn't give
any details, but the current generation of digital switches accumulate
the billing information digitally and can gather as much details as
the customer wants.


	Markku Kolkka
	mk59200@tut.fi

johnl@esegue.segue.boston.ma.us (John R. Levine) (07/31/90)

In article <61563@bu.edu.bu.edu> is written:

>Practically every other country in the world I've been to bills long
>distance calls for a fixed unit price (about a nickel) for a variable
>unit of time (unlimited down to a second or so), instead of the US
>scheme whereby a fixed unit of time (a minute) is billed at a variable
>price (free up to several dollars).

>The former, most popular scheme makes it possible:
> [to do all sorts of swell stuff]

On the other hand, the US approach lets the telcos avoid having to
feed the entire tarriff structure into every end office, and to have
quantity discounts, extended area flat rate plans, and all sorts of
other stuff that would be impractical with an impulse-based scheme.
My long-distance carrier doesn't know the real cost for each call
until the end of the month when they compute the quantity discount
based on the total call volume from all seven of the lines (in four
separate locations in three states) on my home phone bill.

There's no doubt, sent-paid long distance calls from a pay phone are
sort of an orphan, and are, as far as I can tell, the last major area
of US telephony in which there is no competition at all -- intra-LATA
calls are handled by the local telco, inter-LATA calls by AT&T, and
that's that.  But I suspect that, given the relatively small fraction
of calls that are made from pay phones, the US scheme is not a bad
idea.

I also note that a major disadvantage of impulse systems is that until
recently, there has been no way whatsoever to get an itemized bill,
and if you believe that the impulse counter on your line is
overcharging you, no way to challenge the phone company's bill.

Does anyone have any actual data on the number of calls made from
payphones, and how many of them are local, how many sent-paid toll
calls, and how many charged elsewhere, e.g. calling card or collect?


Regards,

John Levine, johnl@esegue.segue.boston.ma.us, {spdcc|ima|lotus}!esegue!johnl

ndallen@contact.uucp (Nigel Allen) (08/01/90)

Regular readers of comp.dcom.telecom may remember that Canadian Telex
service is billed by pulses, rather than by detailed billing. I
suspect the same is true for Western Union's domestic Telex service in
the U.S.
 
In the absence of detailed billing, the Telex operator at Dalhousie
University's Kellogg Health Sciences Library used a stop-watch to time
calls so that end-users could be charged for their outgoing Telex
messages. (This was thirteen years ago, when I was a student at
Dalhousie and worked on the student newspaper there, _The Dalhousie
Gazette_. We used Telex to send and receive news to and from Canadian
University Press, the national organization of Canadian
English-language student newspapers, which had its own Telex machine
in Ottawa. Of course, it helped that the library's Telex operator was
our editor's cousin.)
 
Most news moved by mail back then; Telex was only for particularly
urgent material.