switched access disputes and fcc icc/usf reformIn this post I’m going right to the core element of Switched Access charges – Local Switching. It is among the oldest and most enduring of the switched access rate elements. (see Switched Access Disputes – Don’t Get Bullied Part 2).

For most of its thirty year history, it was uncontroversial. But then the ICC Reform Order established the VoIP Symmetry Rule which permits a LEC to:


“assess and collect the full Access Reciprocal Compensation charges . . . regardless of whether the local exchange carrier itself delivers such traffic to the called party’s premises or delivers the call to the called party’s premises via contractual or other arrangements with an affiliated or unaffiliated provider of interconnected VoIP service, as defined in 47 U.S.C. 153(25), or a non-interconnected VoIP service, as defined in 47 U.S.C. 153(36), that does not itself seek to collect Access Reciprocal Compensation charges prescribed by this subpart for that traffic.”

A plain reading of this rule makes it sound like CLECs can bill for, most notably, the Local Switching function provided by these CLECs’ VoIP partners. It sounds like that because that’s what it does mean. And when I say it exactly like that, everyone seems to be in agreement.

What the carriers dispute is that these VoIP partners are providing a true, compensable Local Switching function when the VoIP partner – as in the case with over-the-top VoIP — does not provide the last mile of end user connectivity. “Yeah, that’s it – it kinda looks likes Local Switching, but it’s really not Local Switching; at least not the kind you get to bill for.”

The carriers’ insistence that the last mile – or the “local loop” – is a necessary part of the Local Switching function really puzzled me.

In my opinion, this issue was settled a long time ago. Prior to 1997, the only loop-associated costs that had anything to do Local Switching were the line-side port costs. After 1997 — with the First Report and Order — even these costs were removed:

Accordingly, for price cap LECs, we reassign all line-side port costs from the Local Switching rate element to the Common Line rate elements. For price cap companies, these costs will be recovered through the common line rate elements, including the SLC and flat-rated PICC.

So, please tell me again (and include footnotes, references, and diagrams as required) why a Local Switching function, to be compensable, must include the very functions that were severed from the Local Switching rate element more than 15 years ago?

For a more in-depth treatment of this hotly-contested issue, check out what Level 3 and Bandwidth had to say – click here.  

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CLEC Switched Access Rate Cap Summary Switched Access Study