{"id":16478,"date":"2022-07-19T06:10:54","date_gmt":"2022-07-19T10:10:54","guid":{"rendered":"http:\/\/mhgoldberg.com\/blog\/?p=16478"},"modified":"2022-07-17T12:29:30","modified_gmt":"2022-07-17T16:29:30","slug":"blocking-telecom-arbitrage","status":"publish","type":"post","link":"https:\/\/mhgoldberg.com\/blog\/?p=16478","title":{"rendered":"Blocking telecom arbitrage"},"content":{"rendered":"

The FCC is taking steps to try to block telecom arbitrage schemes, announcing plans<\/a> to change the inter-carrier compensation rules.<\/p>\n

By way of background, the FCC notes <\/p>\n

The access charge regime was originally designed to compensate carriers for the use of their networks by other carriers. It also helped ensure that people living in rural areas had access to affordable telephone service through a system of implicit subsidies.
\n…
\nArbitrage schemes take advantage of relatively high access charges, particularly for the remaining terminating tandem switching and transport services that have not yet transitioned to bill-and-keep.<\/p><\/blockquote>\n

In 2019, the FCC adopted an Access Arbitrage Order<\/a>, revising its Access Stimulation Rules to prohibit local exchange carriers (LECs) from charging interexchange carriers (IXCs) for services used to deliver calls to access-stimulating LECs. “The revised rules sought to end the ability of LECs to engage in arbitrage of the intercarrier compensation system by extracting artificially inflated tandem switching and transport charges from IXCs to subsidize \u201cfree\u201d high volume calling services.”<\/p>\n

The FCC found “This sort of arbitrage harms consumers, who ultimately bear the costs for these services, whether or not they use them.” <\/p>\n

Since then, the FCC learned about new ways that some carriers are using to continue leveraging arbitrage “schemes.” I would call them scams. <\/p>\n

The announcement last Friday was to introduce new rules to try to close these loopholes in the access rate regime. <\/p>\n

In a separate notice, the FCC proposed a $116M fine [pdf<\/a>, 157KB] against a company that the Commission says has been engaging in local rate arbitrage, with nearly 10 million robocalls to generate toll-free compensation.<\/p>\n

With IP telephony, traffic can readily be generated anywhere in the world and target distortions in access fees in any country or any region.As the US closes arbitrage opportunities for companies engaged in pumping traffic to generate fraudulent telecom access fees, will such schemes move to other jurisdictions? <\/p>\n

Has the CRTC acted adequately to protect Canadian networks and Canadian consumers from the impact of artificial traffic stimulation from foreign and domestic actors? <\/p>\n

Do we understand the magnitude of the issue? Does the CRTC have sufficient tools to detect and prevent traffic pumping? <\/p>\n

Is more proactive regulatory action and enforcement required?<\/p>\n","protected":false},"excerpt":{"rendered":"

The FCC is taking steps to try to block telecom arbitrage schemes, announcing plans to change the inter-carrier compensation rules. By way of background, the FCC notes The access charge regime was originally designed to compensate carriers for the use of their networks by other carriers. It also helped ensure that people living in rural …<\/p>\n

Blocking telecom arbitrage<\/span> Read More »<\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_uag_custom_page_level_css":"","two_page_speed":[],"footnotes":""},"categories":[1],"tags":[],"class_list":["post-16478","post","type-post","status-publish","format-standard","hentry","category-uncategorized"],"yoast_head":"\nBlocking telecom arbitrage • Telecom Trends<\/title>\n<meta name=\"description\" content=\"The FCC is taking steps to try to block telecom arbitrage schemes, announcing plans to change the inter-carrier compensation rules. 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