FCC Poised to Act on AT&T’s Prepaid Calling Cards
FCC commissioners are expected to begin the voting process soon on a controversial AT&T petition seeking permission not to pay access charges and universal service contributions on its enhanced prepaid calling card revenue. AT&T has been withholding millions of dollars in intrastate access charges and universal service payments because it considers the calling card offers an information service that’s not liable for such payments. The petition seeks an FCC ruling that such action is legal.
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The item reportedly has moved from the FCC Wireline Bureau to FCC Chmn. Powell’s office and Powell is expected to begin circulating it to other commissioners as soon as Fri. The highly charged issue has become even more controversial since Congress passed a resolution directing the FCC not to take any action that would “directly or indirectly” raise the rates charged to military personnel for phone calls placed using prepaid cards. AT&T’s enhanced cards are often used by military personnel, although company officials say it’s nearly impossible to determine what proportion of the cards.
The item making its way to the FCC’s 8th floor is expected to disagree with AT&T that withholding access and universal service payments is legal, several sources said. However, the item may not apply retroactively. That would mean AT&T wouldn’t have to pay out money withheld in the past. However, since the withholding of payments would be deemed illegal, the FCC’s Enforcement Bureau theoretically could take action on its own or as a result of outside complaints to require payment.
AT&T has argued the calling cards were information services because they included advertising, among other things. The company recently changed the cards to add enhancements and revised its FCC petition to reflect the additions, which it said met the definition of information services even more clearly. For example, customers can press menu items to learn more about the stores where cards were bought. However, the FCC probably will leave a ruling on the enhanced cards to the future, perhaps asking for comment, sources said.