Phone Companies Bill Public for Nonexistent Equipment 612
Srinivasan Ramakrishnan writes "Forbes has an eye-opening article on the scam that lets the Bells scoop $5 billion every year from the consumer with the sanction of the FCC. The FCC Line charge that appears on every phone bill is a vestige of a deal that was struck by the FCC with the Bells. The deal was touted by the FCC as a historic win that saved $3.2 Billion a year for the consumer - Forbes takes a closer look at the deal."
cut the line! (Score:5, Interesting)
Ever since I've used my cellphone as my main phone, my phone bill stays consistent month to month, I don't pay extra for long distance (or get screwed in intra-state charges), I get no telemarketing calls, and I have one number where I can be reached.
Cut your landline if you can!
Tone dial (Score:5, Interesting)
My father-in-law resisted for years but finally gave in.
Let's not forget andout FCC LD taxes (Score:5, Interesting)
Re:Nationalize local phone access! (Score:5, Interesting)
While I may be inclined to agree with you to a certain extent, if you want to see the effects of having everything nationalised then take a look at the U.K in the 70's. We're still dealing with the effects from a lot of Labour policies in the 60's and 70's. It isn't always a good idea.
This is nothing new... (Score:5, Interesting)
Also, the Bell system invented DSL back in the last 70's but didn't pursue it because of their own short-sightedness. Then it comes to pass that when the Internet boom took off and the Bell companies were left out in the cold, suddenly they wanted to 'charge' fees each time someone dialed-up an ISP phone number. Luckily the count system told the Bells to suck it. The Bell system claimed it was putting more burden on their system, which might very well be the case, however, they also stuck it to the consumer for YEARS with this 'unlimited local calls' for one rate when they had done studies way back in the day to determine that the average customer makes/receives 6 calls a day with the average call being 4.2 minutes. Now that customers are using MORE of their unlimited service the phone company is crying the blues...
Let them reap what they've sewn all these years
Re:Nationalize local phone access! (Score:1, Interesting)
Have you ever looked at Europe where GSM network prices dropped with 100s of percents when THE GOVERNMENT GOT MOSTLY OUT and let the free market do its work? In Holland alone (16 million people) exist FIVE competing mobile telcos. Prices keep going down.
These monopolies exist only because someone is preventing the competition from entering the market. (Yes, that is your friendly government.) Why would anyone need a license to sell phone service in the first place?
Amen to that (Score:5, Interesting)
And yet.
Re:Nationalize local phone access! (Score:5, Interesting)
The fact of the matter is that local phone service is so heavily regulated, subsidized by business service, etc. that there would be *less* overhead if governments provided the service. That doesn't mean private companies couldn't offer service for fancy technologies that are outside the purview of basic service (think private roads and turnpikes).
I don't think this is inconsistent with the Constitution. Back then, roads and canals fell under the infrastructure sphere. Now, I think basic phone service does. I don't believe that government service would prevent private companies from offering new technologies and services, such as bundling a bunch of services together via fiber to a house. But for those that just have a copper wire to their house and want to call someone in town... there should be a public option.
Re:Is anyone *actually* surprised by this? (Score:3, Interesting)
Whenever you've had to report a power or cable or some other sort of outage, was your phone out?
I was one of the early adopters of RoadRunner back in 96, and had cable since up through the end of last year. Verizon offered a deal on DSL, and I bit. Since then I haven't worried a minute about 'net outages of any kind. I almost forget what it was like to have to call Time Warner and report yet another problem with their name servers being down or cable being out.
True Story... (Score:5, Interesting)
What do you use? (Score:4, Interesting)
It's a scam, but they've got me... no other broadband available in my area. Of course, even if cable was available, they STILL force you to get a basic cable package before you can get cable broadband. I'm not a TV watcher, so that's money down a rathole.
What company do you use? Nationwide long distance or anything? I'm curious how you're making this work.
Phone lines... (Score:5, Interesting)
Road Runner moved in a year later and gave me a glorious broadband connection at home, and my servers are at a local ISP. The day my Hughes DirectTV DVR pulls info over my network rather than POTs, is the day I cancel my land line and run all calls through our mobiles. I suspect it is game over for both the cable and telcos once the wireless broadband hits it strides.
Every time the phone company would call me during supper trying to sell me the latest service, I would ask them for one thing. Can you give me a DSL connection? I'll be damned, but that just horked up the call center script badly. (grin)
Re:Is anyone *actually* surprised by this? (Score:2, Interesting)
Re:Amen to that (Score:5, Interesting)
Of course they'll probably tell you that it's not an option. Still, it's worth a shot.
Who do you think owns your wireless service? (Score:5, Interesting)
Who exactly do you think you're hurting?
Verizon = Northwest Bell
SBC = Southwest Bell
Cingular = PacBell (owned by SBC, see above)
Who's left?
AT&T? They started this fiasco.
WorldCom? Better known as MCI, now bankrupt
Sprint? NexTel?
Nobody's going to get screwed by you cancelling yoru land line. You're still paying the same people for your cell phone. Do you think their accounting practices will suddenly become honest just because you're now using wireless?
"There's too much rat hair in McDonald's food, so I'll just have their fries".
Think people! Think!
Dallas (Score:2, Interesting)
Now, he indeed seems to have been obsoleted.
But don't take it wrong : in Europe, we had loads of similar examples : Paris'Mayor's wife who got 10000's of dollars for a few dozen pages bugous report, France former Prime Minister, Edith Cresson, who was proven guilty of sharing European money with her dentist, etc.
So, well, it is not typically American, this is just typically global.
Re:Tone dial (Score:5, Interesting)
Here in the Boston area, I get charged $0.44 per month for TouchTone service. Which is ridiculous, since with today's digital equipment, it probably takes more effort to understand pulse signals than DTMF tones. A couple of folks I know have sucessfully gotten that canceled on the grounds that they don't use TouchTone. I've been fighting with Verizon for a few months now (I have 2 phones in my apartment - one is rotary, and another is electronic pulse only), but I've had no such luck.
Hold on a sec (Score:4, Interesting)
Now lets gets some of the facts straight. What they found was 5 billion in equipment that the bells had on their books but couldn't be found. They aren't getting away with that whole amount each year. I'm outraged by the whole bells situation too, but let's read the article. Especially one as informative as this one. I know, this is
Re:Another reason to cancel landlines (Score:3, Interesting)
I'd just like to add that I have AT&T for my wireless service and they suck. I routinely get bills that say "due upon receipt", but are overdue by the time I get them, somehow all my bills from them always show up with no postmark, and I've had my service disconnected several times for failure to pay a bill that wasn't due yet because of "glitches" in their system. You really can't win, but it's less complicated than the hassles of a landline.
Re:cut the line! (Score:4, Interesting)
-B
Switch to Vonage... (Score:3, Interesting)
Of course, I don't expect this to last too long, but in the meantime, it's been well worth it! My old phone bill had over $35 of bullshit fees a month from the subscriber line charge, to the universal service fee. It's all a giant scam.
that aint all! (Score:3, Interesting)
It was originally supposed to pay for the Spanish American War.
It was supposed to be a temporary tax that went away after it satisfied it's original intent. Haha! Sure...
I wonder what is the oldest such tax??
Routine regulator failure (Score:4, Interesting)
This is a normal failure of regulating monopolies. If your plan for an industry is to have a private monopoly and regulate it, then expect this sort of thing to happen every few decades.
If you choose nationalisation instead, it's much worse. Costs may be low, but service will be dreadful to non-existent. Want a new phone line installed? Sure: it will be ready in 6 months to a year (eg UK or Italy before privatisation).
Local community ownership has been raised here; that might work. One region of the UK -- Kingston upon Hull -- had a phone service run by the local council (city government). I think it was more or less OK, much like the nationalised service. The council sold it off for umpteen million at the top of the telecoms boom, then lost all the money in an investment swindle (or it might have been BCCI). In the UK at least, massive incompetence or corruption is always a danger with local government.
Deregulation is tricky too. Comms networks are a textbook natural monopoly: barriers to entry are huge. You will be lucky to end up with real competition.
I think light regulation is the best answer. Try to encourage competition rather than capping retail prices. The inefficiencies caused by having duplicated facilities provided by competing businesses are small compared to the institutional paralysis produced by public or private monopolies. In many countries people have abandoned monopoly-provided fixed lines in droves for competing cellular providers.
The moment you sit regulators round a table with the industry to make deals, you're heading for disaster. Politicians are tempted to do this to get "achievements" they can point to, but there's always a price and it's usually hidden from the electorate. It's better for the politicians to stand back, and only intervene when they see anti-competitive behaviour, and then stamp down without any discussion.
Re:Is anyone *actually* surprised by this? (Score:2, Interesting)
That prevents me from giving my number to local friends and businesses, thus making the expense of the landline exclusively intended for outgoing calls. My cell minutes would be used up by incoming calls. It's not cost-effective.
I also don't use more than five LD minutes per month.
Accounting complexities (Score:5, Interesting)
For the RBOCS, keep in mind that serious regulation started in 1934, and there were 23 local companies operating under the AT&T banner. Then those companies were consolidated into seven in 1984, and have further combined into just three. Could anyone have kept accurate track of equipment and accounting for it under those conditions?
Re:Nationalize local phone access! (Score:3, Interesting)
Well, if we are talking the voice side, allowing 911 calls on disconnected phones seems pretty beneficial to people who dont want a phone, but can still use 911.
Don't think for a moments they do that out of the goodness of their hearts - the FCC make them do that.
Alex
Re:Nationalize local phone access! (Score:3, Interesting)
Now I have to ask, do you Really want the federal goverment to be in charge of all phone lines? I have a feeling, Mr. Rumsfeld would just love that, and we could consider a phone call a confession from here on out.
Re:Amen to that (Score:5, Interesting)
when ordering a new land line, always reject the touch tone option they charge extra for. for a few weeks, only pulse dialing works. every now and then, dial using touch tones. usually, they start to work after a few weeks.
like mbourgon said, it costs the phone companies more to support pulse dialing over touch tone. they just want to see if you're dumb enough to pay for touch tone first.
How about misplaced equipment? (Score:4, Interesting)
I work at a company whose head office is located in an old manor house within a high-scale community. Sometime during the development of the community, before the company acquired the house and while the community's developer was using it as its sales office, the local phone company decided that the manor house's basement would be a good place to house an OC-3 multiplexer (a Fujitsu FLM-150, in this case) to serve the community, despite the fact that the building would eventually become a private property.
A few years later, the developer finished its work, and sold the house to our company, who then sent contractors to upgrade the electrical and network wiring. At one point, they found two pairs of wires that were unmarked, and they couldn't figure out what they were used for (not out of incompetence, mind you), so they yanked them. Come the next day, a telco van was outside, saying that they had received complaints about loss of service and may I please come in to check our equipment.
It didn't take long for the facilities manager to ask the telco to please get the bloody machine out of our property. The requests have fallen on deaf ears, however. We still have the multiplexer here, along with the telco end every pair of analogue and digital lines in the community, including the T1 smartjacks for the country club next door. It is absolutely trivial to come in and open the multiplexer's cabinet and screw around with the linecards inside it, not to mention being able to tap into any of the lines on the demarc's punch panels themselves. The telco knows all of this, but they won't do anything about it because they're too bleeding lazy and it would cost them money to move the equipment to somewhere else.
This is only the one of the scams of the teleco's (Score:5, Interesting)
"Teletruth estimates that customers paid Verizon Pennsylvania $785 per household for a fiber-optic service they will never receive."
"50% of All Small Business phonebills have mistakes. ---And that's why we have announced our "Send Us Your Phone Bill" campaign in the Verizon territory to help business and residential customers recover overcharges on their Verizon telephone bills."
Also if you have a lot more time than I do you can read "The Unauthorized Bio of the Baby Bells" [newnetworks.com] and How The Bells Stole America's Digital Future [netaction.org]. Excerpt from the latter:
"New Networks Institute (NNI) estimates that consumers have already paid over $45 billion in extra telephone charges, and continue to pay over $8 billion annually. As monopoly providers of local phone service, the Bells are still subject to some regulation, yet they are among the most profitable companies in America today. Bell profit margins are more than double that of the major competitive long distance companies and other regulated utilities and literally 167% above the profit margins of some of America's best-known companies. Much of this excess profit is a result of the financial incentives that were supposed to build the infrastructure for America's digital future."
The guy behind all this is Bruce Kushnick [google.com]. I've yet to find any one claiming he's anything but on the level. If you have please email me.
My blog post about this [icepick.info]
Re:The reason. (Score:3, Interesting)
That's the way to go! When they nationalize things like the phone industry, or even (eventually) the ISP industry, then they shouldn't make it into another agency (then we'll just have more bureacracy), but basically non-profits owned by the gov't. We pay them money (as opposed to it coming out of taxes), and they provide us with a service. Their goal isn't necessarily to make money, but to provide the best service for the least money, and better society.
And what's wrong with that?
--Jason
Re: Another True Story... LD carriers... (Score:2, Interesting)
In the regulatory crap you have to go through, you know your call is being recorded etc... I was handed from MCI to AT&T, but in the process somehow unknown to be, MCI transfered my LD to AT&T, but kept my "in state" calls... You fell asleep so far... My local is with AT&T (cable), instate now is MCI and LD is AT&T.
BUT... MCI decided that ther must have been a problem, so they went and grabbed my LD back from AT&T, but somehow, I ended up with TWO LD carriers, gawd knew which one was actually carrieing my calls, I got two bills with the exact same LD info...
Cutting this short, it took me over a dozen calls, and a conference call between MCI, AT&T LD AND AT&T local to sort the mess out, with each manager (I know better to talk to the bottom feeders, I go right for the managers with the power complexes!) blaming each other, until I just got each company to take what was rightfully theirs... So much so, I actually got a hold of AT&T to "replay" my voice authorisation changing my "instate" and LD to AT&T from MCI, once that as played, everyone shut up, and within 24 hours I was able to verify that my local and instate and LD were all being handled by AT&T... Phew!
All this was over my wife getting a call from MCI billing one afternoon regarding a deliquent in-state bill for just over six dollars (due to mail being stuck together somehow!). She called me, I called MCI, the manager I spoke to was nasty, demanding the $6 bill or he would send my account to debt collection agency, so that is when the "trouble" started with changing all my services to AT&T.
In work, I read the bills we get from VZ having changed our LD carrier a few times overn the past year or so, and the bill is virtually unreadable, and having now seen our first QWest bill, is there any info on the net on hoe to "decode" this CRAP?
Re:What do you use? (Score:2, Interesting)
I will be switching to Verizon as soon as Cellsocket [cellsocket.com] announces their new models. I am tired of Sprint dropping my calls, and being in spots without coverage.
My grand plan is to get a Cellsocket with external antenna, disconnect my home phone wiring from the phone company, and use phones throughout the house, with my cell making/receiving all the calls.
Re:Phone company billing just sucks, period (Score:4, Interesting)
One month I was asked to investigate a huge jump in our bill (30 or 50 percent as I recall). After spending hours fiddling with my record-matching perl and coming back with nothing, I looked at the datestamps on the records. There were records spanning 14 previous months. Once those were stripped out our bill was as close to right as we could hope to demonstrate.
cellular to landline converter (Score:3, Interesting)
Anyway, if I could find one out there, that is what I would use.
Even Larger Scams... Association Fees (Score:1, Interesting)
Supposedly for the cost to tie into the network, oddly enough I don't get one of these when I live in a home which would cost more to wire as it's an independent unit, and funny how it doesn't cost me money every month of every year to get a new phone line added.
Associations pull this scam constantly, they do the same with the Cable, I got about $5/mo going to these association fees, but we'd never actually add them to our community association fees (which are already the highest in the city).
My same scam of a community is trying to charge me money for parking my cars, I'm working with my neighbors to get a group together to get a lawyer and oust our association as our condo group is a land contract which means I own the land my house sits on and an equal share of all common grounds, which means with a full vote any management can and will be dissolved
Associations are insane scams, our group pays a management company $35,000/yr to collect the fees / hire maintenance people, thats just dumb.
Re:Nationalize local phone access! (Score:3, Interesting)
Re:Nationalize local phone access! (Score:3, Interesting)
NO LANDLINE!!! (Score:3, Interesting)
I now use Windows Messenger for my voice, although I have been playing with Xphone (http://www.xten.com) which is simply amazing. Put it on my iPaq with wireless internet, and I now have an 802.11b phone. I've heard there is a Linux version in the works, but won't be out for several months. Can't wait so I can put it on my Zaurus!
So for me, no more long distance charges which is rediculous in my opinion. I'll gladly take my internet phones thank you very much. Asterisk at http://www.asteriskpbx.com can run my internal phone network and Cisco IP phones will replace my landline phones to run over the internet.
http://fwd.pulver.com is my new phone number (18924 to be exact)
So screw the Bells, I don't need'em. Cable internet all the way baby. I've been landline free since January 1st, 2003, and wish I'd done it sooner.
I suspect ... more theft and fraud (Score:3, Interesting)
There are (I think) many other business scams/cons occuring.
My wife got an unknown charge on a credit card. She tried to correct the obvious billing mistake, but as of today many weeks later the business that charged and/or the credit card folks have our money. At one point she was given a phone number to call, she called, and we got charges ($4) on our phone bill for calling the number the company provided. Nothing resolved/achieved we are out about $40 and consider it a lesson learned.
A couple times over the past few decades, I had a problem where the credit card company refused to remove the about $50 charge, another time (different credit card) would not stop recurring charges to an ISP. I told, wrote, and emailed all involved that the credit cards were canceled on my request and that I would not pay any charges or bills that were caused by the companies.
I got some threats, but I used some strong expressive English and did call one company a group of scam and con artist.
I am beginning to here these kinds of complaints more often. The companies end up with a few extra dollars, know you won't sue for $50 worth of fraud, and hope you pay the bill, don't cancel the credit cards, and continue on as if nothing happened.
A few dollars here and there must really help big business's by the millions monthly, and GW Bush thinks folks will trust business and the economy soon. We learned a lesson with enron, GC,
OldHawk777
Reality is a self-induced hallucination.
Re:Nationalize local phone access! (Score:3, Interesting)
As it turns out, as far as I can tell, apparently no federal policy maker (economic or otherwise) has read Milton Friedman's [stanford.edu] Capitalism & Freedom (making this event [stanford.edu] quite ironic). Hell, I haven't even read more than half of it yet, and I can probably tell you how fucked up the current state of regulation is. Things which are currently regulated should no longer be, (e.g., post office, etc.). Things which are currently unregulated should be (e.g., MS, cable, etc.). Doesn't anyone read anymore? Or do politicians never escape adolescence when they think they know more than everyone else?
Vonage to the rescue (Score:3, Interesting)
The voice quality is good, and the price is excellent, and I can take the # anywhere I want to - just plug into broadband, it autoconfigures with DHCP, and in 10 seconds or less, I'm up!
The bells, with all their "X per minute on Wednesdays between 4 and 11PM" bull---t are ripe for a serious change in their business model.