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Wireless Providers’ Requests for Bill-and-Keep

Many of you are receiving requests from wireless providers to renegotiate your wireless interconnection agreements (ICAs) to a bill-and-keep reciprocal compensation rate effective July 1, 2012. The wireless providers are most likely quoting change-of-law as the reason for the request. This was detailed by the Federal Communications Commission (FCC) in their Order on Reconsideration document FCC 11-189 adopted and released December 23, 2011.

You may want to review your existing ICA for:

• Notification period for cancellation or renegotiation
• Term of the ICA and the term for which it automatically renews
• Change-of-law section, if applicable

In the FCC USF/ICC Reform Order FCC 11-161 released November 18, 2011, paragraph 1000 states, “We (FCC) are not abrogating existing commercial contracts or interconnection agreements”.  If your existing ICA is still effective because of the renewal term, you may want to make this part of your renegotiation. If you have a change-of-law section in your existing ICA, the wireless provider may identify change-of-law overrides the renewal term and may quote FCC 11-189.

In the FCC USF/ICC Reform Order FCC 11-161, paragraph 997 states, “We (FCC) limit rate-of-return carriers’ responsibility for the costs of transport involving non-access traffic exchanged between CMRS providers and rural, rate-of-return regulated LECs”. Paragraph 999 states, “the rural, rate-of-return LEC will be responsible for transport to the CMRS provider’s chosen interconnection point when it is located within the LEC’s service area. When the CMRS provider’s chosen interconnection point is located outside the LEC’s service area, we provide that the LEC’s transport and provisioning obligation stops at its meet point and the CMRS provider is responsible for the remaining transport to its interconnection point.”

For wireless providers that have indirect interconnection through an access tandem not owned by your company, the access tandem may be charging you transiting charges for land to CMRS EAS calls routed through the access tandem. During renegotiations, you should be able to include language from paragraph 999 above that would relieve you of this transiting expense.

In your existing ICA, negotiated factors may cause usage to bill as interMTA (interstate and intrastate depending on your negotiated PIU). This interMTA usage is being billed against your standard access tariffs. The wireless providers are only requesting to renegotiate reciprocal compensation to a bill-and-keep rate. InterMTA usage will continue to bill against standard access rates. These ICC revenues will be part of your Recovery Mechanism reporting.

To learn more, please click here to review the Order FCC 11-161 and click here for the Order FCC 11-189.