RBOCs: slapping their best customers

Sat, 11/30/1996 - 7:00pm
Roger Brown

This is exactly the kind of thinking that has some of the RBOCs, unable to keep up with increased demand for more lines, cellular and other services, in trouble with local utility commissions.

Specifically, Pacific Telesis, US West and Bell Atlantic are pointing to a new Bellcore study that says the increasing popularity of the Internet is clogging the nation's telephone lines, making it much more likely that callers are greeted with fast-busy signals instead of a cheery "hello" at the other end.

Calls made to access the Internet average 22 minutes in length (and are bound to grow), vs. four minutes—the average length of a voice call. The frequency of these longer calls is chewing up telephone network capacity and causing the RBOCs to take a new look at their historical traffic models. For example, PacTel took a close look at calling patterns in one area of the Silicon Valley and concluded that something like 16 percent of all calls did not connect, compared to the more typical one percent rate. The problem could be exacerbated now that America Online intends to allow unlimited access for a flat fee.

Instead of embracing the new demand, the telcos seem to want to quell it by charging the ISPs — in advance — to build more capacity through a network upgrade. To gain support from regulators, the telcos predictably put a dark spin on the problem, suggesting that lives could be in danger because emergency 911 calls might not be able to get through.

But some have already seen through the smokescreen. Already, the service providers are crying foul — and so are several of the telephone companies' largest customers.

Intel, Microsoft, IBM, Compaq, Apple, Netscape, Digital, America Online and AT&T WorldNet, among others, have formed the "DATA Coalition" to fight the new fee, which would ultimately have to be passed on to the consumer. Such fees would create a chilling effect and reduce Internet demand, or so the coalition says.

Telecom experts say the problem can be fixed by building more capacity or routing data traffic over frame relay networks. In other words, the telcos could simply take some of their record-level profits, plow them back into their networks, and make even more money by selling more services.

The Telecom Act promised competition in telecommunications. The RBOCs will survive the new era primarily because of their girth. But incidents like this show that their corporate cultures, based on monopolies, will take a long time to change.

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