TELECOM Digest OnLine - Sorted: FCC Questions Verizon, Bell South Regards Internet Fee

FCC Questions Verizon, Bell South Regards Internet Fee

Reuters News Wire (reuters@telecom-digest.org)
Fri, 25 Aug 2006 12:53:25 -0500

Verizon Communications and BellSouth Corp. will be asked by U.S.
regulators to explain a new fee on high-speed Internet customers that
replaces a government surcharge that ended this month, a source
familiar with the matter said on Friday.

Verizon and BellSouth, the No. 2 and No. 3 telephone carriers
respectively, will be sent "letters of inquiry" to see whether the new
charge complies with Federal Communications Commission rules that
require "truth in billing," the source said on the condition of
anonymity.

The companies no longer have to pay a part of their high-speed
Internet revenue into the Universal Service Fund (USF), which
subsidizes communications services to schools, lower-income households
and rural areas, as of August 14.

They had passed that USF cost onto their customers. An FCC decision a
year ago phased out the USF fee for the telephone companies'
high-speed Internet service known as broadband.

However, Verizon said it would impose a new monthly surcharge of $1.20
or $2.70, beginning August 26, which it said was to help subsidize
connection costs. BellSouth said it has continued charging $2.97 a
month, equivalent to the old USF fee.

Verizon had charged digital subscriber line (DSL) Internet customers a
monthly fee of $1.25 or $2.83 to cover the USF contribution, depending
on connection speeds.

AT&T Inc., the largest U.S. telephone company, was not expected to
receive a letter from the FCC, the source said. Letters of inquiry are
typically the first step in an agency investigation into whether
enforcement action is warranted.

A spokeswoman for the FCC declined to comment. Verizon spokesman Brian
Blevins declined to comment while a BellSouth spokesman had no
immediate comment.

AT&T has agreed to buy BellSouth and needs the FCC to approve the
transaction.

Copyright 2006 Reuters Limited.

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[TELECOM Digest Editor's Note: I am glad the government noticed that
Verizon intends to continue sticking it to their customers, but I hope
with this 'truth in billing' thing, the feds at least require Verizon
to quit claiming 'the government is making us collect it from customers.'
But, getting truth out of Verizon; that would be something new and novel,
wouldn't it! PAT]

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