Re: MCI Now Charging Extra on Payphones When Using Phone Card!

snipped-for-privacy@yahoo.com wrote about: MCI Now Charging Extra on Payphones When Using Phone Card! on: 8 Jun 2005 17:52:19 -0700

MCI now charging extra payphones when using their phone card!!!
> MCI has started charging a 65 cent surcharge on calls using their = phone cards ...

Most companies have been adding payphone surcharges to their calling cards for a long, long time. This is absolutely nothing new. I have some MCI pre-paid calling cards that I bought at Costco last Christmas, and they plainly state that all calls made from payphones will be hit with a 10 minute/unit surcharge. At the rate I bought the cards at, that is a 29 cent surcharge.

It's simple to understand why carriers are charging this fee. First of all, carriers have been forced to pay surcharges to payphone providers (via their carrier, OSP or reseller) on each call for years now. The compensation rate for these charges was raised more than six months ago to an all-time high.

When you add the existing charges to the fact that carriers like MCI have to cut individual checks to hundreds of different carriers and resellers each month, you are talking about a major accounting nightmare. In some cases, MCI itself may be the payphone carrier, and it then has to cut a check to a division of its own company, which in turn has to send checks to literally thousands of independent payphone owners all over the country. If the payphone uses an MCI reseller or OSP, you have to add yet another middleman.

You can blame our own Federal Communications Commission for caving-in to payphone owners and others involved in the industry for raising the limit on these surcharges. I guess that they feel sorry for the payphone companies, who have probably seen their revenues drop by 90% in the past 10 years.

William Van Hefner Editor - TheDigest.Com

[TELECOM Digest Editor's Note: But I have to wonder what was wrong with the old 'Separations and Settlements' process AT&T used for about ninety years. And by the way, we had a response on this yesterday as well, where the writer claimed that the 'fee to write checks' also cut into the profit telco made on calls using calling cards, etc. Actually, even without a master 'Separations and Settlements' process like AT&T used to administer, the telcos all have their own proceedures for this, and for the benefit of our writer yesterday, each time someone makes a call from a payphone, the carrier does not sit down and write a check for 65 cents or whatever. They go for about a year at a time, then they subtract what one owes the other from what the second one owes the first one and settle up the difference. In other words, John Q. Payphone Owner has a thousand dollars due him from MCI, and he owes MCI nine hundred fifty dollars. MCI offsets what they owe each other, and send John Q. Payphone Owner the difference, if any, or a bill if he owes them. Now John Q. may have been collecting the aggragate differences each month from the local telco -- let's call them Verizon for example (via the same technique) so when MCI makes an annual or semi-annual settlement with Verizon one of them says "do not forget about John Q and what he has coming"; they compare notes and give John his few dollars due. There is _not_ all that massive numbers of checks written and 'major expenses which cuts down on the profits' as our correspondent yesterday claimed. PAT]