North American Network Operators Group

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Re: SBC/AT&T + Verizon/MCI Peering Restrictions

  • From: Sean Donelan
  • Date: Thu Nov 03 09:19:46 2005

> if i am a paying sbc or other foopoloy voice customer, and i
> place a voice call to aunt tillie, does aunt tillie pay sbc
> to hold up her end of the conversation?

Historically, aunt tillie's residential telephone line was
subsidized by charging more for business lines.  When you called
aunt tillie, a portion of what you paid for the call passed through
settlement charges and access fees to compensated both your service
provider and aunt tillie's service provider for the call.

These were usually implemented for social policy reasons, and its
been a slow process to re-allocate the various billing practices to
eliminate them. Aunt tillie saw it mostly as her local phone bill
increased as she lost the benefit of the subsidy.

> if i am a paying sbc or other foopoloy dsl customer and i go
> to <http://content.provider>, why should content.provider pay
> to give the sbc paying customer what they're already charged
> for?

When aunt tillie watches a home shopping channel, the channel
usually gives a percentage of everything aunt tillie buys from
the channel to the local cable operator.  When aunt tillie watches
basic cable channels, usually the channel gives the local cable
operator several minutes of advertising time every hour, even though
aunt tillie already paid for her cable.  When aunt tillie calls
a toll-free (1-800) number, the business answering the call pays
for the call including the settlement and access charges for
aunt tillie's service provider in addition to the business' service
provider.  Google pays compensation to some web sites to include
"sponsored" links on their web pages.

Why do businesses do this?  Some believe it benefits advertisers to
subsidize consumers basic cable, toll-free phone access and web sites
so more consumers have access to their content, and in turn gives
businesses a bigger market to sell too.

Why would you want to prevent businesses from paying for part of
aunt tillie's Internet access?  If a business wants to pay for "better
than best effort" access for users coming to its web site or using
some other service such as VOIP, shouldn't it have that option?