By approving the item, the commission would effectively rule that local calls are indeed local calls, reaffirming an earlier decision by the panel. It would be seen as win for Pac-West and for many ISPs, as well as for consumers. But Pacific Bell also has petitioned the commission to reconsider its earlier ruling, handed down last October. If the CPUC votes in favor of Pacific Bell's proposal, the commission will reconvene at a later date, allowing Pacific Bell and other local phone companies in the state to claim at least an initial victory. At issue is a complex series of technical agreements and contracts between local phone companies, such as Pacific Bell, and competitors, such as Pac-West Telecomm.
Phone companies pay each other a per-minute fee for using competitors' networks to complete a call.
Access charges do not apply, however, to so-called enhanced services such as Internet traffic. The reciprocal compensation fees for local calls are intended to help offset the cost of maintaining phone networks and gives local phone companies an incentive to carry calls that originate from a customer of a competitor. Because the large local phone companies serve the majority of customers in any one area, the Baby Bells thought the new fees would mean tons of money for them, critics say. Dial-up modem users typically are online for long periods and tie up phone circuits for hours at a time, running up large reciprocal compensation bills for the Bell companies. At the same time, most local phone calls only last a few minutes.