December 2002
Independents Rebut Wireless Petition Against Reciprocal Compensation
In September, T-Mobile and other wireless carriers ("Petitioners") filed a petition requesting the FCC to ban independent LECs from using tariffs as substitutes for reciprocal compensation arrangements; and implied that bill-and-keep should apply for "indirect" interconnection with such LECs (a wireless carrier will typically exchange traffic with smaller ILECs through an intermediate carrier's tandem switch).
Some rural LECs have filed state tariffs, in the last couple of years, as a mechanism to collect compensation for the termination of intra-MTA traffic originated by wireless carriers. This practice was at the heart of similar issues decided by the Missouri PSC in favor of ILECs just last year. The Petitioners assert that compensation for such traffic should be paid only when the ILEC and wireless carrier have entered into an interconnection agreement under the Telecommunications Act of 1996. In the absence of such an agreement, they state that traffic should be exchanged on a bill-and-keep basis.
The Petitioners state that "an ILEC with a lucrative wireless termination tariff in effect has no incentive to negotiate a reasonable interconnection agreement with a wireless carrier." They also claim that the level of traffic exchanged hardly justifies negotiating other compensation arrangements. In the Missouri proceeding, it was the ILECs claiming that the wireless carriers had no incentive to negotiate and were simply refusing to pay for such terminating traffic.
In response to the wireless petition, a variety of independent telco interests weighed in. NECA, a national association of independent and rural carriers, states that the petitioners are seeking tacit Commission approval of a unilateral bill-and-keep intercarrier compensation mechanism that would allow the wireless carriers free use of rural carriers' facilities and services. NECA agreed with other rural interests that the FCC should deny the petition.
As the Missouri PSC pointed out last year regarding these issues, the Telecommunications Act permits either party to petition a state commission, and requires the state commission to arbitrate an interconnection agreement for reciprocal compensation if the parties cannot come to terms on their own. Whatever their motivations, neither the wireless carriers nor the ILECs appear to want to take that route.
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