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Arguments against BA-style Resi ISDN rates
Since "NYNEX" (not yet technically owned by Bell Atlantic but largely
staffed at management levels by BA-hired contractors, and under a
agreement to BA) is rumored to be filing a new ISDN tariff for its entire
region, I've put together a few "talking points" to be used against them. I
do hope to see a MASSIVE intervention against them here in Mass., and since
I probably can't fund it myself, I'll throw in what I can afford (e.g., talk
So here's a quick list of points that I'd like to flesh out into a full
scale attack come intervention time. Others might find them handy to adapt
to other states. Certainly the Delaware commission seemed to have similar
Would that they all did!
*note: The following are provided for informational and enterntainment
purposes only, and reflect the view of the author. Standard disclaimers apply:
Points to be made to regulators in an Intervention against potential NYNEX/BA
rate hikes in MA, and adaptable elsewhere:
ISDN IS STILL A MONOPOLY
Competition may be permitted but only a miniscule percentage of potential Resi
ISDN subscribers have a choice. Resale based on ILEC tariffs doesn't count.
CATV data is not functionally equivalent, though it overlaps for a category
VALUE OF SERVICE IS AN INAPPROPRIATE PRICING MECHANISM
Telco appears to be basing its pricing of ISDN on its perceived "Value"
over and above POTS, rather than on its "cost". In a truly competitive
market, price tends towards cost (per Adam Smith; witness the LD market)
while in a monopoly, regulatory action is a substitute, especially
when transition to competition is intended. "Value of service" pricing
went out with bell bottoms and should not be restored in this instance.
ISDN IS JUST AN INTERFACE TO THE PSTN
As made clear in the 1992 NYNEX/MA case (D.P.U. 91-63-B), ISDN is simply a
new digital interface onto the existing network. Per-line pricing should
reflect the differential in costs. A voice call made on an ISDN line
is indistinguishable, within the network, from a call made on an analog
line. A data call is functionally similar; the same resources are used,
even though the trunks used for data are supposedly all 64-clear and
SS7-linked. That is the norm now anyway.
SWITCHWAY TREATMENT IS NO LONGER APPROPRIATE
In 1991 ISDN data was carried on Switchway, an older Switched 56 network
built out of 1AESS adjuncts. The 1As are history; data is just another
call that avoids AMI/ZCS/RBS trunks.
NAILED USAGE IS NOT AN ISDN-SPECIFIC PROBLEM
Telco may assert that ISDN users are prone to nail flat-rate lines, but
that, if relevant, is not a reason to impose measured service. If this
can be demonstrated to have a cost impact at all, then it can be taken
care of with a threshold price set at a level which is *essentially* flat
to all users who do not nail calls. A threshold should be at least 200
Average users are +/- 40 hours, few between 200 and "nailed" levels. This
distinction allows the typical rate-averaging of POTS flat rates to
continue absent the distortion of averages caused by nailed users. In
any case analog lines with modems are also prone to this.
A higher "semi-permanent" rate for "nailed" calls may be appropriate. But
even this should be based on cost, not imputed from measured rates. Since
most usage is between two dedicated points, a rate could be offered for calls
nailed to a single designated destination CO. Leased-line alternative.
CALLPAK RATES ARE MEASURED SERVICE
Multiple block-of-usage (Callpak) options are simply a prepaid measured
service. Users must estimate future usage, enter service orders when it
changes. Users perceive this as measured and will move to flat rate options,
MEASURED TARIFF IS DESIGNED TO ENCOURAGE GRATUITOUS CENTREX
Telco is attempting to move inappropriate users to Centrex tariff, which
provides unlimited intercom usage. Only low users will want measured ISDN,
but low users are least likely to want to invest in ISDN's up-front cost.
Much ISDN data is to a fixed destination, ISP or employer, who is
encouraged to own Centrex. Most users are in different COs and Centrex
SOPs require costly leased interoffice facilities (3 DS0 channels, BRITEs).
This is a poor way to save the resources allegedly wasted by "excessive"
usage; it's effectively three nailed lines!
It appears that the bulk of telco's planned ISDN investment in on behalf
of Centrex, not in order to make ISDN a viable alternative to analog POTS.
Measured service is noxious to the bulk of residential subscribers, who
form the highest volume of potential ISDN users; non-Centrex ISDN volumes
will therefore be minimal. This improperly holds the bulk of the network
in its technological past.
MOVING FROM A FLAT TO MEASURED SERVICE RESULTS IN STRANDED INVESTMENT
Today's NYNEX tariff allows flat-rate speech/audio bearers. These are
widely used for 56 kbps data, in effect treating ISDN as a very clean
line capable of supporting "modem" calls up to 56 kbps. Adding usage
charges to these calls will cause many users to abandon the service.
Since NYNEX has capitalized a large installation expense, this will
cause losses that would not occur if the tariff were not made noxious.
MEASURED USAGE DISCOURAGES EFFICIENT USE OF NTS RESOURCES
The vast majority of ISDN local cost is non-traffic-sensitive. Switch
ports, service ordering, loop engineering, loops, SLCs, MSRs, etc., are
all NTS. Measured rates reduce use of these, saving only on the TS
cost which is trivial. Overall economic efficiency goes way down.
Inasmuch as measured ISDN drives some users to POTS lines, actual network
trunk utilization increases because POTS takes longer to set up calls,
longer to transfer equivalent data.
[this one is very MA-specific]
MEASURED ISDN RATES DO NOT COMPARE TO MULTIPLE POTS OPTIONS
NYNEX offers Boston-area subscribers a choice of several flat rate plans.
Measured ISDN service has only a single radius, generally very small.
Therefore POTS is dramatically cheaper than measured ISDN for users whose
preferred destination is not in that radius. The analog rate options
should be reflected in ISDN tariff, from fully-measured up to LATA-wide
Fred R. Goldstein firstname.lastname@example.org
BBN Corp. Cambridge MA USA +1 617 873 3850