A Look Inside The Changing Telecom Environment

Leo Berz

Given the current economy and regulatory atmosphere, there are many myths about pricing and technical issues. It is important for customers to have a strong understanding of these myths and their potential impact on budgets and the quality of their networks.


Telecom is rapidly becoming more deregulated―Public Utilities Commission (PUC) and Federal Communications Commission (FCC) approved tariffs are giving way to carrier Service Guides, which can be changed at anytime without approval from regulatory bodies. As a result, it is important to consider the following:

  1. Review Service Guides (SG) prior to executing any agreement, making sure the ‘Order of Precedence’ doesn’t override negotiations.
  2. Never accept percentage discount pricing that refers to a table in the SG, as these guides are subject to change at any time. Fixed pricing allows you to know exactly how much you will be paying, which will help control your budget. If your carrier does not provide fixed pricing, have them specify the prices that the discounts will be applied to, which will lock-in your pricing for the term of the contract.
  3. Challenge any carrier claims that they cannot do something because of the tariff of other legal documents, such as Sarbanes Oxley (SOX); if the claim is legitimate the carrier should be able to show you the actual language that they are referencing.
  4. Be aware that many State PUCs are no longer willing to enforce telecom tariffs, so you need to identify billing errors as soon as possible.


While regulatory charges are on the rise across the board, few, if any are mandated to be paid by the end user. These charges are paid by the carriers, who are allowed to pass them on to customers.  Not only can carriers choose if and how much to pass on, there is a lot of confusion regarding the applicability of older fees, such as the Federal Universal Service Fund (USF) as it applies to newer services, such as Multiprotocol Label Switching (MPLS). A few helpful reminders:

  • Always get written clarification of all fees and how they are calculated before you execute an agreement.
  • Your best opportunity to get a carrier to waive a regulatory fee is when they first start assessing it. If they come back with a reasonable answer to validate the charges, you should ask that they consider waiving it on your behalf.

The changing telecommunications environment is creating both challenges and opportunities, and unfortunately, the onus to assess the shifting landscape falls to the customer. Monthly bills can be hard to read and understand, so it is important to ensure that someone is auditing them on a monthly basis. Get more information and best practices for managing your telecom network.
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