Chapters

By Bruce Galle
Telecom Consultant
Wizard Communications

"Fantastic work! Bruce is truly educating the public about the Telecom industry.
His book is extremely informative!"
--Jean-Michel Lenoir
Total Call International, Inc.

CHAPTER 1: Definitions in Layman Terms

To get right into things, you will need to know a few definitions as well MANDATORY fees/taxes. I emphasize mandatory for many long distance providers nickel and dime their customers with additional charges implemented by the long distance provider themselves not imposed by the FCC or other regulatory divisions.

You will notice that some fees/taxes are State specific. If you live outside these specific States, simply browse to the next definition.

"Bruce Galle has done a great job with this book & his knowledge of the industry is exceptional."
PowerNet Global Communications

CA High Cost Fund Surcharge or High Cost Fund B - A set percentage charged on IntraState calls within California only. This is a similar fee as the USF fee charged nationally on InterState and International Calls.
.
California Relay Service (Also Known As, CA Relay and Comm Surcharge) A set percentage on IntraState calls within California Only. The collected monies are for those with hearing and speech disabilities so as to use text telephones to communicate.

FCC (Also Known As, Federal Communications Commission) The governing body which makes and enforces regulations by which communication companies must abide by.

InterLata - refers to IntraState and InterState long distance, excluding IntraLata (see following definitions).

IntraLata - also known as, Regional or Local Toll Calls. The easiest way to comprehend this zone would be as follows:

You pay a monthly service fee to your Local Telephone Company in exchange for local services (an area that is free to call). Immediately following this free calling zone and extending outwards a little is what is referred to as IntraLata. The breakdown varies from area to area, however for many this may encompass calls down the road or within the same area code that are charged as long distance calls. Immediately following this small zone, extending outwards, which includes the rest of your State, is known as IntraState (see next definition).

IntraState - An area within your State beginning immediately outside your IntraLata area outwards, encompassing the rest of your State.

InterState - Long distance calls originating in One State to any other State within the Continental USA.

Kansas USF (Also Known As, Kansas Universal Service Fund) - A set percentage charged on IntraState calls within Kansas only. This is a similar fee as the USF fee charged nationally on InterState and International Calls.

Local, State & Federal Excise Taxes - These are mandatory taxes that are equally weighted across all carriers. The rates vary from area to area, hence eliminating myself from accurately quoting an average rate. What I can inform you is the fact that these are mostly based on a percentage thus the lower your bill the less you will pay on taxes!

The Federal Excise taxes are not set or collected by the FCC. This was implemented by the US Congress and collected by the Internal Revenue Service

Monthly Minimum Service Fee - A fee charged by most companies either per telephone line or per account. Some companies offer to waive the monthly minimum fee if your total usage is equal to or greater then a set amount per month.

Nebraska USF (Also Known As, Nebraska Universal Service Fund) - A set percentage charged on IntraState calls within Nebraska only. This is a similar fee as the USF fee charged nationally on InterState and International Calls.

Network Access Charge These are unregulated fees charged by some providers to make an additional profit to cover their overhead.

PICC Fee (Also Known As, Carrier Line Fee - FCC Primary Carrier 1st Line - LD Line Charge - National Access Fee - Presubscribed Interexchange Carrier Charge - Presubscribed Line Charge) - This is a FCC imposed tax that applies to business lines only. The rate can vary from each company starting around $3.25 to about $5.50 per month per line. Good industry standards averages are approximately $4.00 or so, per line per month.

The fee applies to businesses with two or more telephone lines (telephone numbers).

Some deceitful providers that you will not find recommended by myself at anytime impose this fee on residential lines and single line businesses.

PIC Freeze - Helps to eliminate your long distance service from being slammed. Once a PIC Freeze is applied, the only persons with authorization to request a change in long distance service are those listed when you setup the freeze with your local telephone company.

In short, you have mandatory fees/taxes, USF, Local, State and Federal Excise Taxes and PICC Fee, which applies to business lines only. If you see others on your long distance phone bill, they are additional charges added by your long distance provider in the attempt to increase their profits at your expense!

Slamming - This is an illegal practice by some long distance providers, which entails the provider changing over a consumer's long distance service without permission or knowledge of the consumer.

Telecom Infrastructure Fee An additional fee added by some telecommunication companies to help absorb some of the costs involved, i.e. billing costs incurred...

Texas Infrastructure Fund (Also Known As, Texas Inf Fd) - A set percentage charged on IntraState calls within Texas only.

Texas Universal Service Fund (Also Known As, Texas Universal Service) - A set percentage charged on IntraState calls within Texas only. This is a similar fee as the USF fee charged nationally on InterState and International Calls.

Universal Service Fee (USF) (Also Known As, Universal Connectivity Charge - Universal Service Charge - Universal Service Fund Charge - National Access Contribution - Federal Universal Service Fund Surcharge - Carrier Universal Service Charge - CHCF-A, CHCF-B) - In 1996 the FCC imposed the USF tax for several reasons.

The Act's universal service provisions and the Commission's universal service rules are intended to (as per the Federal Communications Commission's web site):

1. Increase access to advanced telecommunications services throughout the nation.

2. Advance the availability of such services to all consumers, including those in low income, rural, insular, and high cost areas at rates that are reasonably comparable to those charged in urban areas.

3. Promote the availability of quality services at just, reasonable, and affordable rates.

The rate charged by companies varies however the maximum imposed by the FCC is now 9.1%. Some companies add an additional unregulated fee on top sometimes called a network access fee. The USF is a charge mandated on state to state and international calls only however some companies apply to all long distance calls, including intralata or regional long distance calls.

Utah USF (Also Known As, Utah Universal Service Fund) - A set percentage charged on IntraState calls within Utah only. This is a similar fee as the USF fee charged nationally on InterState and International Calls.

VOIP also known as Voice Over Internet Protocol allows one or a business to take advantage of lower rates and taxes by placing calls through the internet. Most companies such as SunRocket VOIP or Vonage offer service through a regular telephone.

Wyoming USF (Also Known As, Wyoming Universal Service Fund) - A set percentage charged on IntraState calls within Wyoming only. This is a similar fee as the USF fee charged nationally on InterState and International Calls.