Getting Intercarrier Compensation Right – At Long Last

Given a choice in my youth between being an FCC regulator and operating a toll booth on the Chicago Skyway, I may have chosen the FCC gig. Given a choice between being an FCC regulator and a dishwasher on a Lake Michigan commercial fishing boat, I would have chosen the suds. My point is, being an FCC commissioner is not the best job in the world. Nor is it the worst.

Unquestionably, it is an important job, particularly when the Commission lurches into one of its periodic bursts of activism. This is one of those times. The FCC is rethinking the intercarrier compensation, or ICC, issue.

I am not an anti-government zealot. Nonetheless, I become anxious when the acronym “FCC" appears in the same sentence with any form of the verb “thinking." Cynicism? No, not me. A more positive person does not walk the earth – or at least the sidewalks of Chicago. No, my anxiety is based on an appreciation of the long history of weakly considered decisions rendered, and consequential issues ducked, on 12^th Street, not on a character flaw.

The ICC issue is serious. As telecom services become more sophisticated (think mobility and video and tablets), and more deeply threaded through every aspect of our business, personal and entertainment lives, the ICC issue becomes correspondingly more serious, too. Most communications involve multiple networks, requiring compensation to all the networks involved. This is a fundamental telecom issue that is complex, important and neglected for too long.

The current ICC rules are based on a voice-dominant model of the world. That world long ago sank beneath the rapidly shifting sands of history. The voice-dominant ICC model should have sunk with the world it mirrored. Enter the FCC’s famous lethargy. The world changed; the model has not.

Now the FCC is addressing the issue, belatedly, but not a moment too soon. Unfortunately, in trying to do the right thing, finally, it is probably going to do the wrong thing.

Problem-solvers recognize that the dimensions of a solution must match the dimensions of the problem, or the problem will go unresolved. Think of a disaster like Pearl Harbor. Clearly, America had to respond. Had FDR only made an angry protest, his solution would have been inadequately sized to the dimensions of the problem. The same principal applies to regulation.

The FCC is considering an ill-sized solution to the ICC problem. This is the persuasive argument put forward in a Billing & OSS World Report titled “Unresolved Intercarrier Compensation Issues A Drag On Competition."

The Report is written by B/OSS Editor-in-Chief Tim McElligott and sponsored by TeleSphere. It's based on a presentation made by TeleSphere’s director of Business Development, Jim Steele, and Vice President Carey Roesel of Technologies Management, at B/OSS Live! earlier this summer.

Laboring under archaic rules, carriers are increasingly contentious: “… not only are they disputing everything, they are simply refusing to pay – at all," Steele notes. “Companies are begging for more clarity."

Unseen by the world, ICC lies at the very root of the networks and technology interactions that make modern social life possible. In the absence of regulatory clarity and leadership at the federal level, confusion will spread, important relationships among carriers will fray and break – and the telecommunications revolution will suffer an unnecessary setback.

Be informed on this key issue. Check out this important eight-page Report on the ICC challenge.

E-mail me at llannon@vpico.com or click on the comment button below.

Larry Lannon is group publisher of VIRGO ’s Communications Network, which includes Billing & OSS World , Channel Partners and vision2mobile .