Phone Company Wants Internet Providers to Pay Up Computer Modems Create Busy Signals for Callers

By 1996, New York Times News Service | St Louis Post-Dispatch (MO), November 25, 1996 | Go to article overview

Phone Company Wants Internet Providers to Pay Up Computer Modems Create Busy Signals for Callers


1996, New York Times News Service, St Louis Post-Dispatch (MO)


Depending on whom you believe, Pacific Telesis has either stumbled across the first evidence of a potentially disastrous breakdown in the nation's telephone network or is being cynically alarmist to further its regulatory agenda.

In July, the California-based regional Bell company said its central switching offices in Santa Clara and San Jose experienced a sudden surge in telephone traffic. The company discovered that an Internet service provider had purchased 2,000 phone lines to connect its subscribers to the Internet through computer modems.

During the evenings, when subscribers spend hours hooked up to the Net, calls swamped the network, creating busy signals for many people trying to make calls. "The entire industry faces a bottleneck," said Jim Diestel, director of advanced services at Pacific Telesis. But as far as the Internet providers and long-distance carriers are concerned, Pacific Telesis and other Bell companies are vastly exaggerating the threat of a network overload to force a change in the rules that govern how they are paid for carrying data traffic. The two sides are taking their debate to Washington. The Federal Communications Commission is to begin changing this area of telephone regulation next month with a proceeding intended to redesign the network access charges that long-distance carriers and possibly Internet providers pay to the Bells. Because Internet service providers do not now pay these charges, the Bells contend that they are not getting their fair share of Internet revenue. So far, the FCC has shown little sympathy to the Bells. But Fred Briggs, chief engineering officer of MCI Communications, said the Bells were drumming up a network crisis to bolster their contention that they deserved more compensation. "This is much ado about nothing," he said. The argument of the phone companies is simple: Most Internet connections begin with a dial-up phone call, and local phone rates are based on the assumption of brief conversations. But Internet calls tend to last much longer, which ties up network switches and costs the phone companies money because they must upgrade their systems to handle the demand. Computer companies and Internet providers have banded together to fight the Bells on this issue. …

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