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2016 tariff efforts to build on 2015 initiatives

Last year was an active one for our interstate access tariff (F.C.C. No. 5) as we added or enhanced several services. We also looked at ways to enhance our Rate Band Buy Down program, which allows members to buy down their rate bands below the NECA-assigned rate band for certain classes of service. But before we review 2015 offerings, let's look forward to what we're planning for 2016. Key initiatives include:

  • Introducing a Digital Subscriber Line 90-day speed trial, allowing members' customers to increase their DSL speed on a trial basis. During the trial customers will pay the higher speed rate. If at any point during or at the end of the trial period they don't like the higher speed, they can go back to their original speed with no penalty.

  • New symmetric and asymmetric DSL speed options up to 1 Gbps for customers who are unable to take advantage of the Ethernet Transport Service MultiMedia Virtual Circuit Channel.

  • Potential new offering of asymmetric DSL speeds of 10/1 Mbps and 25/3 Mbps, allowing members to offer DSL speeds that maximize their company's network platform capabilities. 

  • Reducing select DSL rates to allow for a rate progression in line with the new speeds. This will enable members to successfully market higher DSL speeds at an incremental price the customer is more willing to pay.

  • A goal of aligning ETS rates with symmetric DSL Data-Only rates. The rate alignment is designed to make both DSL and ETS services attractive for those customers using DSL Data-Only or ETS as their preferred service to connect to the Internet. 

  • Investigating additional ETS Term Plan discounts of seven and ten years for larger customers. Combined with the Rate Band Buy Down program, additional discounts will help members achieve competitive rates when completing requests for proposals.

  • Evaluating with members ETS-specific costs to potentially establish an ETS rate band assignment separate from other non-DSL special access services rate bands. 

  • Researching the introduction of ETS service level agreements pertaining to latency, jitter and mean time to repair, thereby giving members increased flexibility to comply with customer-specific service level agreement requirements. We would plan to keep the current Class of Service and Quality of Service offerings in the tariff, while simultaneously establishing optional minimum ETS service level guarantees with credits for performance misses based on industry standards. 

  • Exploring the disaggregation of rates on an optional basis within a study area so that rates for densely populated economical areas, which are easier to serve, are lower than rates for harder to serve areas. Disaggregating rates could position members as the number one choice in environments where customers have service provider options. Loop disaggregation could include DSL and ETS loops.

  • Researching the implementation of additional term and volume discounts for large customers with significant long-term demand. Rates will allow members to take advantage of generally available tariff terms offered to similarly situated customers, e.g., offerings to E-rate and health care customers, which include longer term agreements and higher volume discounts, with or without rate stability based on service costs. 

2015 offerings respond to members' needs

In 2015, we responded to members' requests for increased tariff flexibility, while taking into consideration universal service reform measures and FCC rules and regulations. Here is a sampling of what we accomplished in 2015:

  • Helped members take advantage of our Rate Band Buy Down program, which simulates options members would have outside the pool. This optional program allows members to charge a lower than NECA-calculated tariff rate for a category of special access services, thereby allowing members to charge more competitive rates and retain customers. Members report revenues to the pool at the NECA-assigned rate band. Both members and NECA sign an agreement defining the specific terms of the arrangement. Interest in this program continues in 2016 for members who are not otherwise able to reduce costs and/or stimulate demand to the point of being assigned to a lower rate band needed to meet customer expectations. 

  • Added a new ETS Bandwidth Add-On optional feature, which gave members the flexibility to offer their ETS customers additional bandwidth capacity in 10 Mbps increments.

  • Eliminated the Access Order Charge associated with new orders for ETS MM-VCCs, which are used to boost the DSL speed for single switch companies. 

The here and now

Although there are challenges associated with tariff initiatives, many can be overcome with accurate and reliable cost and demand data from our members. The ability and feasibility of completing our 2016 filings also hinges upon pending FCC actions and related regulatory hurdles.

With more regulatory and universal service reform on the horizon, we are prepared to assist companies with new reporting requirements and mandatory filings. We will continue to focus on evolving our tariff to ensure members can provide relevant services as technology advances. We are committed to helping members participate in flexible pricing strategies and arrangements while receiving the benefits of pooling. 

Filed under January 2016, Tagged with Tariffs

Senior Editor - Linda Zinner 
Editor - Rocky Marcelle     

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