date: October 3, 1995
I am writing to express our opposition to the ISDN tariffs proposed by Bell Atlantic (BA) for Maryland residential consumers. In particular, BA has proposed to offer ISDN residential tariffs based upon metered usage, apparently contrary to Maryland law, which requires BA to also offer a flat rate option. We are in support of the issues raised in the letter of October 3, 1995 from Theresa V. Czarski, from the office of the Maryland People's Counsel, which raises this same issue, and we also urge the Commission to consider the views of Maryland ISDN consumer David Lesher, who has also written the Commission on this point.
The Consumer Project on Technology (CPT) was created by Ralph Nader this year to investigate consumer issues raised by new technologies, including such topics as telecommunications regulation, copyright, privacy or the pricing of new pharmaceutical drugs. The CPT is concerned that telephone Local Exchange Companies (LECs), including BA, are pricing ISDN services far too high. We are particularly concerned by the use of metered tariffs for ISDN use, which are the principal barrier to widespread deployment of this important technology.
While ISDN service is a mature technology, it is only recent that telephone companies, consumers and a few policy makers have begun to appreciate its potential importance. In contrast to the expensive "fiber to the outhouse" proposals for network upgrades, local ISDN service, delivered through the existing switched public network, is a technology that could provide consumers with very rapid access to a wide range of competitive content services at a very low price, if BA and other LECs would price it at cost, rather than at the much higher prices reflected by BA's current ISDN residential tariff.
As noted above, of particular concern is the issue of metered usage. BA wants to charge residential consumers by the minute to use ISDN lines, even though residential consumers may use the same lines with modems under unmetered tariffs. BA has expressed its preference for metered usage tariffs in other forums, including, for example, the Federal Communications Commission's recent Notice of Proposed Rulemaking on ISDN tariffs, where BA sought to de-emphasize proposed flat rate Subscriber Line Charges (SLCs), presumably at the expense of the metered Common Carrier Line (CCL) charges.
Residential ISDN tariffs are important, because they would provide consumers with high speed access to the Internet, which is now the most important and competitive network for content services. BA seeks to limit consumer access to the Internet or other open networks, so that it can market closed cable television or Video Dialtone (VDT) systems, that have large entry barriers for competitive content providers.
It is also important to note that BA is currently testing ISDN systems that deliver more than 10 times the current ISDN BRI service of 128 kbps to residential consumers using ordinary telephone lines. However, even the older 128 kbps BRI service is an extremely important service, that could potential allow consumers to bypass cable television and other closed network services in order to reach the much broader number of content providers that can connect to the Internet.
One can imagine an environment where BA's attempts to sell video on demand or other content services to consumers will compete against small businesses that can deliver services over residential ISDN connections. BA doesn't want an ISDN tariff that makes such competition feasible. BA's proposed metered charges for residential ISDN usage make it impossible for most consumers to use ISDN services in ways that fully exploit the new technologies.
According to the Maryland People's Counsel, BA is required to offer residential consumers a flat rate
option for the ISDN service. We urge the Commission to:
1). reject the BA proposed residential ISDN tariffs,
2). take steps to implement a new tariff that brings the BRI ISDN tariff into closer alignment with
the cost of voice grade telephone service, without metered usage charges, and
3). investigate the possibility of requiring BA to provide residential consumers with even higher bandwidth ISDN services prices at cost, without regard to usage for local calls.