Telecom Terminology

Below are definitions of telecom terms commonly used by NECA.

Access charges - The fees long distance companies and other network users pay to local telephone companies to originate and terminate calls on their networks.

Access line - A communications facility extending from a customer’s premises to a serving central office switch, sometimes referred to as a subscriber loop, local loop, or the “last mile.”

Average schedule companies – NECA members that receive pool revenues, or settlements, for interstate telecommunications services based on a series of statistical formulas, approved by the FCC, that approximate the amounts received by a similar cost company.

Common line pool
- The pool NECA administers for its local exchange carrier members’ non-traffic sensitive costs of providing interstate access associated with subscriber loop plant. Pool members apply the end user common line charge rate element and others as tariffed in NECA’s FCC Tariff No. 5.

Cost companies – NECA members that receive pool revenues, or settlements, for interstate telecommunications services based on their actual interstate investment and expenses, calculated each year from detailed cost studies.

Digital subscriber line - A technology that brings high-bandwidth information services to the home or small business over telephone loop plant. DSL technology enables a loop to simultaneously carry voice, which takes little bandwidth, and high speed data.

Ethernet - A local area network technology that connects computers, printers, servers, etc., in a physical location. Carrier ethernet equipment provides reliable ethernet connectivity beyond the LAN through the telecommunications network. Ethernet uses twisted pair (copper), fiber optic and coaxial cable and may also use wireless connectivity or transport.

High cost loop  support – This federal universal service fund provides support to offset high unseparated local loop costs for rural study areas. 

Incumbent local exchange carrier – The telephone company that, on the date of enactment of the Telecommunications Act of 1996 (February 8, 1996), provided telephone exchange service in a specific area and was deemed to be a member of NECA pursuant to section 69.601(b) of the Commission’s regulations (47 C.F.R. 69.601(b)).

Intercarrier compensation – Flows of payments among telecommunications carriers that result from the interconnection of telecommunications networks under current systems of regulation.

Internet protocol - The method by which packet data is sent from one computer to another. Every server, router and switch in an IP network is uniquely identified by at least one IP address.

Internet service provider – Business entity that provides Internet service to the end user customer.

Interstate common line support – This universal service fund supports the interstate common line costs of rate-of-return ILECs by funding the residual between the ILEC’s interstate common line costs or revenue requirement and the revenue collected from the common line rate elements charged pursuant to NECA’s FCC Tariff No. 5.

Local number portability - The ability to transfer an existing telephone number assigned by a local exchange carrier and reassign it to another carrier.

Local switching support – This universal service fund supports high local switching costs of small ILECs.

Minutes of use – A total of all premium and non-premium originating and terminating interstate traffic sensitive switched access minutes which are switched in a Class 5 (local) end office.

Notice of Proposed Rulemaking – An NPRM is the document a federal agency (like the FCC) issues and publishes in the Federal Register that describes and solicits public comment on a proposed regulatory action. It is often preceded by an NOI (Notice of Inquiry) and may be followed by an FNPRM (Further Notice of Proposed Rulemaking).

Phantom traffic – Traffic that is terminated but is not billable because the originating source is not identified.

Rate banding - Pool participants with similar unit cost and pool contribution characteristics are placed into rate bands and all charge the same set of rates.

Rate band buy down - RBBD allows pool paricipants to charge rates using a lower rate band than assigned initially, provided the rates are above the pool member's direct cost. The pool member reports revenue based on its original rate band assignment.

Settlement – A settlement is calculated for each pooling company based on their individual expense and tax amounts, including a share of the pool’s calculated rate of return. Each company then receives its settlement minus the access revenue it has already collected.

Tariff 4 - NECA’s F.C.C. Tariff No. 4 describes the location and technical capabilities of wire centers providing interstate access telecommunications service. It also provides information to support the ordering and billing of jointly provided (meet point or billing percent) interstate access service.

Tariff 5 – NECA’s F.C.C. Tariff No. 5 contains the rates, regulations, service terms and conditions that apply to interstate access services offered by local member telephone companies participating in the tariff.

Traffic sensitive pool - The pool NECA administers for the portion of the network where costs vary according to usage. Pool members apply the TS tariff rate elements: traffic sensitive – switched, including charges to interexchange carriers for long distance traffic and traffic sensitive – special access, including DSL and other broadband services.

Universal service fund – A group of federal funding programs that promote universal service goals created by the FCC to provide support for high cost telcos, low income consumers, rural health care initiatives and schools and libraries.

Voice over internet protocol - A technology that allows users to make telephone calls using a broadband Internet connection instead of a regular (or analog) phone line.