A Call for Action on Rural Call Termination Problems

You know there is a problem when it takes four tries to reach a business (a rural independent telephone company no less) on the telephone during normal business hours—and not because the party you are trying to reach is unavailable, but because you hear a strange series of clicks or just dead silence on the line. Luckily, I’m a trained professional who knows a “rural call termination problem” when I encounter one, so I kept re-dialing the North Dakota number I was trying to reach until I got through…and I promptly asked the RLEC manager, “So, have you been having some rural call termination problems lately?” He responded that the problems have been getting worse, but nobody seems to be doing anything to effectively put an end to the call completion arbitrage activities that are directly harming rural consumers and businesses.

Over the past few months, the Federal Communications Commission (“FCC”) Enforcement Bureau has shown real enthusiasm for going after a variety of “bad actors” in the telecommunications industry. The situations vary, but the overall theme is that the FCC does indeed penalize companies and individuals who prevent calls from reaching their destination at the cost and quality that American consumers expect from one of the most advanced telecommunications networks on the planet.

The FCC has the tools and authority to issue fines and penalties for telecommunications carriers who either by their own actions or the actions of their chosen intermediary carrier fail to terminate calls to rural areas. The FCC Enforcement Bureau has recently issued forfeitures and consumer advisories about predatory pre-paid calling card rates, cellular signal jammers, and junk faxes just to name a few examples. It has been just over one year since FCC held a Rural Call Termination Workshop, where rural stakeholders implored the FCC to fine and penalize carriers engaging in call blocking, dropping, and degrading. Despite releasing a promising Declaratory Ruling in February, the FCC has issued zero penalties or public warnings to enforce call blocking rules already on the books.

The true number of calls to rural areas that are dropped or degraded is unknown, but estimates range from the hundreds of thousands to over a million calls this year. Rural telephone companies have prided themselves on impeccable call reliability for decades, but they are now experiencing 15% or higher call failure rates in some areas. This inevitably reflects poorly on the rural carrier even if the problem is not directly the rural carrier’s fault.

Industry experts and advocates at the national and state associations, state utility commissions, engineering groups, and professional service firms are joining RLECs in efforts to draw attention to the issue at the FCC and Congress. As a carrier, the most important actions you can take at this time are to closely document all known call termination problems, and make strong efforts to educate your customers about the issue. Unfortunately, rural call termination problems are particularly confusing for consumers, difficult to document, and time consuming to trace to the source—but this should not stop you from being proactive with efforts to provide data, seek and implement best practices, and work towards a solution.

All carriers who are experiencing these problems should participate in a NECA and Rural Association call completion survey by November 2, 2012. It is critical that unified arguments from the rural industry are backed with solid data about the problem when the industry approaches the FCC and requests action. Part of the challenge is correctly identifying the underlying causes of the problems, which can require effort on the behalf of the RLEC, the rural customer who is not receiving calls, the calling party, and the calling party’s carrier. In other words, there are a lot of pieces to the puzzle, and each piece is necessary when compiling data and documenting the problems.

A Call Termination Handbook released by the Alliance for Telecommunications Industry Solution (ATIS) last month explains a number of possible causes of the problems, and the Rural Associations and NECA have also been educating their members about suspected causes. The problems can primarily be attributed to “least cost routers” (LCRs) or “underlying providers” who transport calls between the calling party’s provider and the RLEC. There may be multiple LCRs along the call path, and a long distance provider might change LCRs frequently based on whichever cost is lowest. The constantly fluctuating LCR market and downward pricing pressure ultimately bodes ill for rural consumers in high cost areas if an LCR’s routing algorithm determines that the cost to terminate the call to an RLEC is too high. Additional problems can be attributed to misaligned standards between IP and PSTN networks, which have been particularly troublesome for fax transmissions. All told, there are numerous points along a call path where failure is possible, and RLECs should be aware of the myriad causes for call termination problems.

A biting enforcement action by the FCC might not solve the problem entirely, but it will at least show that the federal government is concerned about the welfare of rural residents and businesses. Some parties in the telecom industry believe that the problem will solve itself as access rates move closer to zero over the next seven years. But are you willing to tell your customers to wait seven years for the problems to improve? Chances are they will show their appreciation by changing carriers. Meanwhile, the strong, united voice of the rural telecom industry is more important than ever—make sure your call to action to lawmakers and regulators is completed.

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Cassandra Heyne

About Cassandra Heyne

Cassandra Heyne is a regulatory affairs analyst for John Staurulakis Inc., a firm celebrating its 50th year of providing consulting services to the rural telephone industry. Cassandra helps clients with regulatory filings and compliance, assists with cable and broadband projects, and writes analysis on regulatory issues for JSI News & Commentary and the firm’s other communications. Prior to joining the JSI, Cassandra worked for JSI Capital Advisors as an analyst and blogger where she wrote extensively on the USF/ICC Transformation Order and its aftermath as well as a wide range of telecommunications issues such as federal and state legislative initiatives, wireless policy, retransmission, IP-IP interconnection, rural call termination problems, telecom mergers and acquisitions, disruptive innovations, net neutrality, and successful competitive strategies for rural telecommunications providers. Cassandra also wrote her own blog, Rural TeleCommentary: Perspectives on the Rural Telecommunications Industry, and has worked for a top industry law firm and national association in Washington, DC. Cassandra has a deep connection to the Iowa telecommunications industry: her family has owned and operated Walnut Communications in Walnut, Iowa for over 95 years. Cassandra grew up in the industry, which gives her a unique and insightful perspective that she is always eager to share with clients, co-workers, and readers.