January 26, 2005 10:06 AM PST
Net telephone fees have users fuming
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pretending all along. All of a sudden, SBC doesn't look that bad."
And that kind of harsh assessment is bad for an upstart industry in which the smallest operators, in particular, rely on word-of-mouth recommendations and "buzz" in lieu of large marketing budgets or longtime name recognition.
Follow the money--vaguely
VoIP providers say they have identified the longstanding fees in recent months without raising the cost of their services--no harm, no foul. But since it is unclear how, or even whether, the fees make their way to government coffers, the line items aren't sitting well with some consumers.
"The money is first handed to any of the four major phone companies, who then hand it to the government," said Janee Briesemeister, a senior policy analyst for the Consumers Union advocacy group.
How these sums are set and what's done with them aren't clear. "These charges, in the hands of the major phone companies, really amount to nothing--they're for whatever. That means everybody should be worried about something called a regulatory recovery fee," she said.
The billing controversy dates to September, when Vonage began breaking out the regulatory charges on its billing statements, a practice soon taken up by rivals, including Vonage, Lingo and BroadVoice. Net phone providers insist that their billing practices are legitimate because the charges directly offset fees passed on to them from the local phone companies, with nothing extra going into their own pockets.
Less than 2 percent of a typical Time Warner Cable bill for its Digital Phone offering contributes to a fund for rural telephone expansion and to a location-aware 911 service informally known as E911. Keith Cocozza, a spokesman for Time Warner Cable, said his company must contribute to those funds, despite the lack of government fees imposed directly onto VoIP firms.
"There really is an E911 service fee," he said. "We really do contribute to universal service."
True or not, listing the charges has struck a raw nerve among some customers and engendered new feelings of distrust.
"I would guess that the regulatory fee most people are seeing is related to the federal universal service," opined one contributor to a Broadband Reports forum critical of the fees. "However, I would NOT be surprised if the providers were slipping in something extra there."
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