RealTime IT News

Bell Atlantic Files to End Reciprocal Compensation

Bell Atlantic is one of the first local telephone company to petition state regulatory agencies for relief from disbursing reciprocal compensation payments to Common Local Exchange Carriers.

Since the FCC ruled that Internet traffic is inherently interstate in nature on Feb. 25th, a tug-of-war over millions of dollars in reciprocal compensation payments from regional Bells to CLECs has begun. The Commission concluded that the "jurisdictional nature of ISP-bound traffic is determined by the nature of the end-to-end transmission between an end user and the Internet," and thusly is interstate communication.

Bell Atlantic filed a petition with the Commonwealth of Massachusetts' Department of Telecommunications & Energy last week and is currently placing reciprocal compensation monies in an escrow account until the dispute is resolved by the state regulatory agency.

Mark Mathis, Bell Atlantic's senior vice president, said the petitions Bell Atlantic has filed in Massachusetts are pursuant to modifying an earlier order by the Massachusetts DTE. "This has nothing to do with charges, it has everything to do with whether we have to pay CLECs," according to Mathis.

Bell Atlantic has also filed petitions with regulatory agencies in Maryland and New York seeking to modify the respective state's original orders to pay reciprocal compensation. Bell Atlantic has estimated that the company's payments to CLECs would total more than $350 million this year.

"We're the only one's paying for Internet access by the minute through reciprocal compensation on interconnection agreements. We simply want to stop paying by-the-minute," Mathis said.

With billions of dollars in reciprocal compensation agreements on the line, other RBOCs are expected to follow suite and file for further modifications from state regulatory agencies. In essence, RBOC will demand an end to reciprocal compensation.

FCC Chairman William E. Kennard maintains that the FCC's Feb. 25th ruling has not opened the door for per-minute Internet access charges. "The FCC has reconfirmed the Internet's exemption. Consumers will see no new charges on their Internet or phone bills," according to Kennard.

Bell Atlantic provides wireline voice and data services as well as wireless services. Bell Atlantic companies are also among the world's largest investors in high-growth global communications markets, with operations and investments in 23 countries world-wide.