Ed’s Telecom Alert

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Lot of the FCC stuff I have not covered the last two months that I took hiatus while focusing on the PUC affairs.  Since I am no longer with the PUC - I can  start focusing on issues for edsalert; I’ve decided to start most recent FCC Public Notices (PN) and work way back to older ones.  

This Public Notice by the FCC is really a notice for Internet-based relay service providers only; however, I thought it would give y’all some interesting insight of how subsidization is done. 

Before I belabor this, allow me to explain a little how subsidization works now.  InterstateTRS Fund is what pays relay providers for Interstate relay and Internet-based relay minutes that the relay providers submitted to the NECA (National Exchange Carrier Association).  NECA is a contracted company that does the subsidization procedure.   States pay for relay minutes incurred within state (intrastate and local relay calls).  This PN is at the federal level, and states are not involved.  Okay?  

Click to this:  FCC PN on Reimbursable Cost

Now this new 10-digit phone number is new feature of TRS.   The FCC has decided to keep that separate from the Relay minutes; in other words, the FCC has decided not to put costs of implementing 10-digit phone number system into rates-per-minute.   Instead, the FCC wants each Internet-based relay providers submit costs to the NECA and once NECA reviews the costs per the FCC instruction, will reimburse the cost to Internet-based relay providers.  

The PN advised Internet-based relay providers that they need to submit costs associated with tn-digit phone number creation that is required by all providers by Dec 31, 2008.   If the providers expect to be paid for the costs for setting up 10 digit phone numbers, then they need to submit costs by end of January 2009, and thereafter submit on a quarter basis.

eyes open & thumbs up,

Ed B

All..

This one is a bit long so I will not do a vlog on this one.  

There was a lively discussion at a listserve on government models of State TRS Request for Proposal versus "Free Enterprise" of Internet-enabled relay service (IP/VRS).  I would like to share some of my musings and see what y’all have to say since there are more of you now (836 subscribers now) - I’ve discussed this before. 

Before I belabor on all this, why am I bringing that up?   The 10 digit phone number that VRS/IP users will get end of December 31, 2009 - if not sooner - will make it possible to identify originating and terminating points of a relay call.  In the past, VRS/IP use Internet Protocol so it was not possible to identify the originating or terminating points if they are at the Internet end of it.  So there is no way to know if the Internet-based relay calls are within a state or out of state so federal took the full responsibility to pay for VRS/IP.  But because now the VRS/IP calls can be determined if from within state or out of state so that means the FCC can pass responsibility of paying VRS/IP providers on to states.  When will that happen? Who knows..maybe soon after the 10 digit phone number is up and running with all bugs fixed? 

Now what are these models?  

Model #1:  State TRS RFP means state releases request for proposal (RFP) and relay providers would submit their proposals.   The best proposal - not always necessarily the lowest price reimbursement - would be chosen by state; usually by regulator, or a advisory committee or selected persons to be part of RFP committee. Few states allow state telephone association by joint agreement among telephone companies select a relay provider.    

Model #2:  "Free Enterprise" of Internet-enabled relay service is done by pre-analyzed reimbursement rates based on the cost breakdown provided by states (using MARS account methodology) and any company can be relay provider providing they met the requirements to be relay provider.  Federal decides if vendors qualify or not.  

OK?  

Now first of all let’s not kid ourselves - both models are govt subsidized - and not paid by customers like most telephone users.  We do, however, pay as ratepayers or taxpayers (all of us including hearing persons who may or may not use the service) which in turn subsidize relay service in both models.   Telephone companies collect fees from us and then they in turn pay into a fund that pays for relay service; (model #1) states usually by state regulators (PUC, PSC, etc), and (model #2) federal by federal regulator (FCC).  Both states and federal basically adopts these financial arrangements.  

There is a federal relay law that requires ALL states provide relay service with exception of Internet-enabled relay services. In other words, VRS/IP are not "required", but permitted.  There are a few federal relay regulations that list rules of what relay service must comply including Internet-enabled relay service (with some exceptions of some items being waived) to be a relay provider.  VRS/IP relay service - even though not required - must adhere to relay regulations to be reimbursed by the federal fund. 

That said, let’s muse… 

At traditional relay service level, states typically choose one provider with exception of California.  On other hand, at the federal level, Internet-enabled relay services (IP and VRS), any company with enough capital can be part of the service as long as they meet certain specifications to be relay provider.   Multi-vendors are possible with Internet-enabled relay service while with states, typically only one relay provider is selected.   As you can see obvious difference between states and federal. 

At the federal mode #2, Interstate relay service (long distance calls made out of states) and Internet-enabled relay services only have to follow federal relay regulation and its bare minimum requirements.  States, on other hand, varies from state to state on what is required.   A few states merely adopt what federal relay regulation says; in other words minimum regulations.  However, most states write their own relay regulations that often surpass what federal relay regs require.   An example is Average Speed Answer (ASA - how many calls answered within specified time frame), many states chose the more stringent criteria of 3.3 ASA (average answer time shall not exceed 3.3 seconds) than what federal require which is 85/10 (85% of calls be answered within 10 seconds be answered).  States often ask for aggressive outreach to be part of the package.  Federal will subsidize only portion of marketing or outreach.   IP/VRS model #2 have to compete for customers and outreach is paid mostly by IP/VRS providers while state model #1 and its selected relay provider often partner up and do outreach projects together.    

Reimbursement rate from federal is based on - supposedly - the "average" reimbursement rates and costs collected from all states whereas reimbursement rates from states are based on the submitted reimbursement rate by relay providers (RFP process).   So smaller states - because of its low call volume - typically pays higher reimbursement rates whereas larger states typically pays lower reimbursement rates.   One important note: national reimbursement rate is based on ALL of bid price per minutes of each state and then reimbursement rate are averaged and calculated.  

Now you understand why if federal decide to pass subsidization responsibility of Internet-enabled relay services on to states, the reimbursement rates for states will likely be much higher and states will likely choose ONE provider rather than multiple providers to keep reimbursement rates low.  If states chose three providers in that state,it means the call volume for EACH provider will be 1/3 lower than state total thus the reimbursement rate likely will be higher.  Most state governments are frugal so they will opt for one provider because one call volume for one provider will get lower reimbursement rate.  

So we prefer to keep Internet-enabled relay service at federal level to make it possible to have choices of different IP or VRS providers.   However, it seems federal is determined to pass the subsidization responsibility on to states.    Is there a win-win solution to that?   I believe so, and I hope to share with you all what the win-win solution might be.  The idea I have is a proposal I believe VRS/IP providers, and deaf/hoh communities will find attractive, but not to federal agency and possibly a few state regulators as well. 

For now, any questions/comments on this so far?  I hope I am making sense of the difference between the two models.  Feel free to ask, agree, oppose, or offer alternative ideas.  

eyes open & thumbs up,

Ed

PS: Would you have preferred this to be Vlog even though it may be more than 10 minutes long?  Let me know your thoughts…

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The FCC has certified a list of states that meets the following criterias:

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Click for expanded explanation of the Notice of Certification.

FCC Certifies States

Texas passed muster!  Whew!  Then again so did most states. 

eyes open & thumbs up,

Ed B