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Vonage All providers of telephone service are required by law to make certain payments.
All providers of telephone service are required by law to make certain payments. Some of these apply to all common carriers; others apply only to interstate carriers. Many of these expenses date back to the earliest days of regulated common carriers. Traditionally, these costs were considered operating expenses, just like payroll, overhead, and Federal Income Tax. Companies charged their customers enough to cover their expenses, including these mandated fees, plus their allowed or chosen profits. In the last 20 years or so, many telecom companies have advertised lower prices, and then added on fees earmarked to recover some of these mandated expenses. The expense, itself, is not new. The practice of itemizing it and separating it from the advertised price of their service is what has changed. That is a business decision. They can advertise a price and then add wording like "plus applicable fees" and bill more than the advertised price. This might well be considered false advertising. It is, however, common practice in the telecom industry and some others.
By comparison, Cablevision, in NJ, does not do this. Their bill for residential Optimum Voice telephone service is for the exact amount advertised. They are still paying the mandated fees, and charging enough to recover the expense, but not explicitly passing them through. Their residential voice service in NJ is priced at $29.95. Their bill adds nothing to this price. Vonage residential service is advertised at $24.95 but they add $6.59 in fees, including NJ sales tax, for a total of $31.54. So Vonage actually costs $1.59 more, but is advertised at a lower price. (The services are not directly comparable; Vonage has a richer feature set.)
The company contribution to Universal Service is determined by computing a quarterly-adjusted fraction of their interstate revenue. For a company which flat-rates their intrastate and interstate calling services, they probably have to prorate their total revenue according to their overall minutes of use of each category. I doubt that they bother doing this individually for each account. They probably divide the total contribution by the number of subscriber lines and arrive at a single per-line amount to pass through to each subscriber. Their contribution varies according to variations in their revenue. Their contribution rate (the fraction of their revenue) is set periodically by the Universal Service Fund Administrator, and varies according to the total revenue of all interstate carriers and the total expenses of the Universal Service Fund. Their subscriber count varies as customers come and go. Their revenue also varies as subscribers come and go and choose one or another billing plan. It is, therefore, not surprising that the itemized amounts change from time to time.
Read The Full Thread: Check Bill - Federal Universal Service Fee Monthly Increase
• Thanks to all. I have a "thing" about fees that are pocketed by a non-regulated
• Has anyone noticed that the Federal Universal Service Fee has increased slightly
• Yes, and I'm getting damned tired of being nickeled and dimed. My $15 plan now costs
• My November bill increased 14 cent compared to my October bill for the Federal
• Who Pays for Universal Service?
In general, all telecommunications companies
• Sales taxes and 911 fees are mandatory. Even the 911 fee questionable. The other
• The charge is for low income phone service. Half of them have cell phones anyway!
• The regulatory recovery fee and the 911 fee are Vonage imposed fees. They keep
• Yes, mine has increased from $1.43 in November 2006 to $2.31 in February 2008!
• The charge assists the poor to maintain service. I guess they use their cellphone
DLevenson posted "All providers of telephone service are required by law to make certain payments." on 08/05/2008 |
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