Comments on: What’s With the 712 Area Code? http://saunderslog.com/2006/10/11/whats-with-the-712-area-code/ A daily round table on the tech industry with experts and callers from all over the globe. Join us as we pick apart the news and get to the meat of what\'s happening out there. Fri, 04 Jul 2008 20:53:03 +0000 http://wordpress.org/?v=2.5.1 By: Wayne http://saunderslog.com/2006/10/11/whats-with-the-712-area-code/#comment-355952 Wayne Sat, 18 Aug 2007 12:24:02 +0000 http://saunderslog.com/2006/10/11/whats-with-the-712-area-code/#comment-355952 Hi Ann, I work on USF issues on behalf of consumers, so I can definitely give you an educated answer. You have made a number of assumptions that are not true. First, the reason you have to pay USF is because it is part of the rates charged by your phone, wireless, or VOIP carrier. You are correct that they are the ones obligated to contribute to the USF -- what you fail to recognize is that they have a right to pass it on to you as a separate line item on the bill. Not paying that line item is the same thing as refusing to pay the full bill. When you do that, the service provider will respond by terminating your service. It is simply part of the rate they charge you. Rates are never optional. So no law requires you to pay the USF -- you pay it purely as part of the cost of getting your service from the company. International rates have nothing to do with the USF except that you do pay the USF percentage on the cost of your international calls. International rates vary by country. Some of the best pay as you go long distance services charge as little as 5 cents per minute to most of Europe. Some countries, such as Iraq cost much more because the local companies there charge your company high terminating access charges. The amount you pay to the USF has nothing to do with these free services or any other "scams". What you pay is purely a function of the demand for the 4 USF programs allowed by FCC rules divided by the total interstate revenues of the contributor companies. This results in a contribution factor which is currently 11.2% of the interstate portion of your bill. Comcast's ability to absorb their contribution without passing it on is irrelevant -- the FCC allows them to pass it on to consumers and it is just another cost of doing business which is always ultimately paid by consumers. I agree somewhat with your last point -- the USF subsidizes schools and libraries over $2.25 billion per year and it can be argued that this shouldn't come from a hidden tax on phone bills - it should come from taxpayers. However, since tax hikes are so unpopular, it is more politically expedient to put these hidden fees on your phone bills. The USF needs reform for a lot of reasons -- there is a lot of waste in my opinion especially as wireless carriers now get over a billion dollars per year with insufficient accountability to show the public benefits that are supposed to result from their receipt of these funds. The FCC has just announced that it will be considering major reforms to the USF. Let me know if I can provide any further info for you. Wayne Hi Ann,

I work on USF issues on behalf of consumers, so I can definitely give you an educated answer. You have made a number of assumptions that are not true.

First, the reason you have to pay USF is because it is part of the rates charged by your phone, wireless, or VOIP carrier. You are correct that they are the ones obligated to contribute to the USF — what you fail to recognize is that they have a right to pass it on to you as a separate line item on the bill. Not paying that line item is the same thing as refusing to pay the full bill. When you do that, the service provider will respond by terminating your service. It is simply part of the rate they charge you. Rates are never optional. So no law requires you to pay the USF — you pay it purely as part of the cost of getting your service from the company.

International rates have nothing to do with the USF except that you do pay the USF percentage on the cost of your international calls. International rates vary by country. Some of the best pay as you go long distance services charge as little as 5 cents per minute to most of Europe. Some countries, such as Iraq cost much more because the local companies there charge your company high terminating access charges.

The amount you pay to the USF has nothing to do with these free services or any other “scams”. What you pay is purely a function of the demand for the 4 USF programs allowed by FCC rules divided by the total interstate revenues of the contributor companies. This results in a contribution factor which is currently 11.2% of the interstate portion of your bill.

Comcast’s ability to absorb their contribution without passing it on is irrelevant — the FCC allows them to pass it on to consumers and it is just another cost of doing business which is always ultimately paid by consumers.

I agree somewhat with your last point — the USF subsidizes schools and libraries over $2.25 billion per year and it can be argued that this shouldn’t come from a hidden tax on phone bills - it should come from taxpayers. However, since tax hikes are so unpopular, it is more politically expedient to put these hidden fees on your phone bills. The USF needs reform for a lot of reasons — there is a lot of waste in my opinion especially as wireless carriers now get over a billion dollars per year with insufficient accountability to show the public benefits that are supposed to result from their receipt of these funds. The FCC has just announced that it will be considering major reforms to the USF.

Let me know if I can provide any further info for you.

Wayne

]]> By: Ann http://saunderslog.com/2006/10/11/whats-with-the-712-area-code/#comment-355407 Ann Fri, 17 Aug 2007 13:53:01 +0000 http://saunderslog.com/2006/10/11/whats-with-the-712-area-code/#comment-355407 Hey, just wanted to let all you COMCAST subscribers know that you are paying a "fee" to the "Federal Universal Service Fund" EVERY month on your bill! I just noticed that this charge varies per month due to the percentage rate on the total cost of your calls. Now, Comcast offers a plan that you pay $X/month with long distance and local provided. If you want to call INTERNATIONALLY, you will be paying 42/min! Follow? Whatever your costs are TOTAL for all calls (including the monthly fee for your phone service), muliplied by the percentage rate for the USF, this is YOUR COST to all those who are "scamming" the phone companies! Now, my last fee for this USF was $12.97 in addition to all the other rediculous fees I have to pay! Will I continue to pay this percentage rateon my calls to the USF so I can get international calling rates LOWER then 42 cents/minute? Maybe. I'd have to do the math! Right now my international calls to Iraq are costing me well over $100/month (plus the $45 monthly charge for Comcast then all the taxes and other fees). I have been looking into this USF thing for a few days because it seems so wrong for companies, such as Comcast, to make the consumer pay into this "Fund" that is required by the federal government for the IP PROVIDERS to pay into! I think Comcast can absorb the costs themselves! I see so many new high rises being built for Comcast and other such things that Comcast seems to have enough money for that they can pay into the Fund and not me, the consumer! If this is a Fund that the IP providers have to pay into, why do I (the consumer) not have a choice whether I want to contribute to this Fund or not? I am NOT REQUIRED by any law to pay Comcast this USF charge so why am I still seeing a charge on my bill??? Anywho with an educated answer? *One more thing. If schools, libraries, and government provided medical facilities are "funded"/get their money by local taxes, state taxes and other federal taxes from the tax payers, why should we pay into the USF if these facilities are getting our taxes anyway? Isn't that what ALL the other taxes are for....to provide schooling, libraries and medical centers to all Americans? Hey, just wanted to let all you COMCAST subscribers know that you are paying a “fee” to the “Federal Universal Service Fund” EVERY month on your bill! I just noticed that this charge varies per month due to the percentage rate on the total cost of your calls. Now, Comcast offers a plan that you pay $X/month with long distance and local provided. If you want to call INTERNATIONALLY, you will be paying 42/min! Follow? Whatever your costs are TOTAL for all calls (including the monthly fee for your phone service), muliplied by the percentage rate for the USF, this is YOUR COST to all those who are “scamming” the phone companies! Now, my last fee for this USF was $12.97 in addition to all the other rediculous fees I have to pay! Will I continue to pay this percentage rateon my calls to the USF so I can get international calling rates LOWER then 42 cents/minute? Maybe. I’d have to do the math! Right now my international calls to Iraq are costing me well over $100/month (plus the $45 monthly charge for Comcast then all the taxes and other fees). I have been looking into this USF thing for a few days because it seems so wrong for companies, such as Comcast, to make the consumer pay into this “Fund” that is required by the federal government for the IP PROVIDERS to pay into! I think Comcast can absorb the costs themselves! I see so many new high rises being built for Comcast and other such things that Comcast seems to have enough money for that they can pay into the Fund and not me, the consumer! If this is a Fund that the IP providers have to pay into, why do I (the consumer) not have a choice whether I want to contribute to this Fund or not? I am NOT REQUIRED by any law to pay Comcast this USF charge so why am I still seeing a charge on my bill???

Anywho with an educated answer?
*One more thing. If schools, libraries, and government provided medical facilities are “funded”/get their money by local taxes, state taxes and other federal taxes from the tax payers, why should we pay into the USF if these facilities are getting our taxes anyway? Isn’t that what ALL the other taxes are for….to provide schooling, libraries and medical centers to all Americans?

]]> By: winterwarmer http://saunderslog.com/2006/10/11/whats-with-the-712-area-code/#comment-324128 winterwarmer Tue, 10 Jul 2007 08:30:30 +0000 http://saunderslog.com/2006/10/11/whats-with-the-712-area-code/#comment-324128 Hi Guys, Reading through all the above discussion regarding Futurephone and methods used sure is interesting reading. Now that it is no longer available and AT&T are taking legal action with their big gun lawyers it seems that it will be a long time in settling. Interesting to note was the misconceptions about 'free' minutes many have. Nothing is free. You buy your 'free' minutes in your call plan. All these companies like Futurephone means that you do eat up those so called 'free' minutes. Now I am going to tell you about a new patent pending VoIP by Global1touch. Their call back DOES NOT USE YOUR FREE MINUTES. Hey! I hear you say - "That's great". Global1touch launched only a couple of months ago and is expanding it's services rapidly. It is very low cost and has the availability to give you free calls, or very low cost calls. The quality of service is excellent in clarity with no 'packet' lags. I recommend everyone to give it a try. The service package is free. You just pre- pay $10.00 for the call minutes. Have a look here and watch the video: http://www.global1touch.com/world Any questions just contact me. Winterwarmer Hi Guys,
Reading through all the above discussion regarding Futurephone and methods used sure is interesting reading.
Now that it is no longer available and AT&T are taking legal action with their big gun lawyers it seems that it will be a long time in settling.

Interesting to note was the misconceptions about ‘free’ minutes many have. Nothing is free. You buy your ‘free’ minutes in your call plan. All these companies like Futurephone means that you do eat up those so called ‘free’ minutes.

Now I am going to tell you about a new patent pending VoIP by Global1touch. Their call back DOES NOT USE YOUR FREE MINUTES. Hey! I hear you say - “That’s great”. Global1touch launched only a couple of months ago and is expanding it’s services rapidly. It is very low cost and has the availability to give you free calls, or very low cost calls.

The quality of service is excellent in clarity with no ‘packet’ lags. I recommend everyone to give it a try. The service package is free. You just pre- pay $10.00 for the call minutes.

Have a look here and watch the video: http://www.global1touch.com/world

Any questions just contact me.

Winterwarmer

]]> By: Drew Yates » Blog Archive » AT&T/Cingular blocks cellular customers from free conference call services http://saunderslog.com/2006/10/11/whats-with-the-712-area-code/#comment-217483 Drew Yates » Blog Archive » AT&T/Cingular blocks cellular customers from free conference call services Fri, 27 Apr 2007 18:29:31 +0000 http://saunderslog.com/2006/10/11/whats-with-the-712-area-code/#comment-217483 [...] and FuturePhone—work by routing their calls through a local call exchange in Iowa. The 712 area code used by these services allow the local carriers to charge a number of subsidies to those carrying [...] [...] and FuturePhone—work by routing their calls through a local call exchange in Iowa. The 712 area code used by these services allow the local carriers to charge a number of subsidies to those carrying [...]

]]> By: Alec http://saunderslog.com/2006/10/11/whats-with-the-712-area-code/#comment-199093 Alec Fri, 13 Apr 2007 03:30:16 +0000 http://saunderslog.com/2006/10/11/whats-with-the-712-area-code/#comment-199093 Wayne, they're back as of April 4th. I got my dates wrong. They were shut down for most of the month of March, however. Wayne, they’re back as of April 4th. I got my dates wrong. They were shut down for most of the month of March, however.

]]> By: Wayne http://saunderslog.com/2006/10/11/whats-with-the-712-area-code/#comment-198897 Wayne Thu, 12 Apr 2007 22:32:01 +0000 http://saunderslog.com/2006/10/11/whats-with-the-712-area-code/#comment-198897 But the free conference call sites are still operating via the 712 mechanism. I don't see any change on those web sites. But the free conference call sites are still operating via the 712 mechanism. I don’t see any change on those web sites.

]]> By: Alec http://saunderslog.com/2006/10/11/whats-with-the-712-area-code/#comment-195907 Alec Mon, 09 Apr 2007 23:39:59 +0000 http://saunderslog.com/2006/10/11/whats-with-the-712-area-code/#comment-195907 All shut down, Jake. AT&T pulled the plug on the iowa rural telcos, causing a NASTY battle. All shut down, Jake. AT&T pulled the plug on the iowa rural telcos, causing a NASTY battle.

]]> By: Jake http://saunderslog.com/2006/10/11/whats-with-the-712-area-code/#comment-195901 Jake Mon, 09 Apr 2007 23:30:41 +0000 http://saunderslog.com/2006/10/11/whats-with-the-712-area-code/#comment-195901 So its been a couple months... do any of these free calling sites still exist? So its been a couple months… do any of these free calling sites still exist?

]]> By: Wayne http://saunderslog.com/2006/10/11/whats-with-the-712-area-code/#comment-187182 Wayne Mon, 02 Apr 2007 13:31:24 +0000 http://saunderslog.com/2006/10/11/whats-with-the-712-area-code/#comment-187182 Thanks, I do see your point. I thank you because yours was the only web site that answered my initial question about how these free services make money. You are correct about the impact of the USF but that would have happened with or without these 712 services. One underlying problem is that the USF gives out lots of money irrespective of the actual earnings of the phone companies that are being subsidized. Congress will be looking to reform the USF this year but I'm not holding my breath. Wayne Thanks, I do see your point. I thank you because yours was the only web site that answered my initial question about how these free services make money.

You are correct about the impact of the USF but that would have happened with or without these 712 services.

One underlying problem is that the USF gives out lots of money irrespective of the actual earnings of the phone companies that are being subsidized. Congress will be looking to reform the USF this year but I’m not holding my breath.

Wayne

]]> By: Alec http://saunderslog.com/2006/10/11/whats-with-the-712-area-code/#comment-185011 Alec Sun, 01 Apr 2007 11:23:59 +0000 http://saunderslog.com/2006/10/11/whats-with-the-712-area-code/#comment-185011 I agree Wayne, and thanks for articulating it so clearly. My, perhaps convoluted, argument in the initial post was that without the USF the plants and infrastructure to deliver these services wouldn't exist. I agree Wayne, and thanks for articulating it so clearly. My, perhaps convoluted, argument in the initial post was that without the USF the plants and infrastructure to deliver these services wouldn’t exist.

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