The Federal Communications Commission yesterday said it would make long-distance phone companies that compete with American Telephone and Telegraph Co. pay local phone companies on a usage rather than a flat rate basis for connection to their networks starting Jan. 1, 1986.
The decision could cause rates to consumers to rise as greater costs are incurred by AT&T competitors who now pay on a flat rate monthly basis and therefore, in some cases, have a slight competitive advantage over AT&T which pays on a usage basis. In the long run, it may also make it tougher for the competitors to challenge AT&T as the competitors' costs rise, analysts have said.
AT&T competitors currently get a 55 percent discount on the flat rate charges they pay. The companies need to be connected to the local phone networks to provide their customers a means to reach their long-distance service. They pay on a flat rate basis for the use of 9,000 minutes of monthly connection time.
As the "equal access" process, which allows consumers to gain access to the long-distance company of their choice without dialing a lengthy code first, is phased in across the country, long-distance companies ultimately would have paid on a usage basis, anyway, as AT&T does now.
FCC officials have said the current system is flawed because it allows larger companies like MCI and Sprint to actually use more than 9,000 minutes of connection time while penalizing smaller new entrants into the long-distance market that use less than 9,000 minutes.
In another action, the FCC said it would examine deregulating billing and collection services local telephone companies provide to long-distance companies. The agency noted yesterday it always had doubts about the necessity of regulating such services and said competition would ensure that rates stayed reasonable for the services.
The agency also said it would preempt state and local zoning regulations in situations where local government prevents the consumer use of satellite receive-only earth station "dishes" used to receive television programming.
United Satellite Communications Inc., a satellite-to-home television company, asked the agency to preempt local zoning regulations of the dishes when, according to the company, a Chicago ordinance was enacted against the use of the dishes "to protect the city's cable industry."
The agency said under the Communications Act, individuals have a limited federal right to receive satellite cable programming at their homes.