TELECOM Digest     Sun, 16 Jan 94 11:39:00 CST    Volume 14 : Issue 33

Inside This Issue:                          Editor: Patrick A. Townson

    Re: Unmetered Local Service (Jack Decker)
    Re: Unmetered Local Service (Fred Goldstein)
    Re: Unmetered Local Service (David A. Kaye)
    Re: Unmetered Local Service (Al Varney)
    Re: Unmetered Local Service (Bill Pfeiffer)
    Re: Unmetered Local Service (Cliff Sharp)
    Re: Unmetered Local Service (TELECOM Digest Editor)
----------------------------------------------------------------------

From: ao944@yfn.ysu.edu (Jack Decker)
Subject: Re: Unmetered Local Service
Date: 16 Jan 1994 05:27:46 GMT
Organization: Youngstown State/Youngstown Free-Net
Reply-To: ao944@yfn.ysu.edu (Jack Decker)


In response to my recent article, Pat wrote:

> [TELECOM Digest Editor's Note: The thing Jack Decker and other pro-
> ponents of flat rate billing seem to forget or ignore is that in most
> instances of measured billing, the majority of telephone subscribers
> actually pay LESS for service than with flat rate. A small minority
> of the users -- mainly people with telephone intensive lifestyles such
> as modem users -- pay more. Where flat rate service exists, the rate
> is invariably evened out in such a way that telco still makes money
> based on average usage which tends to run high on the curve due to
> modem (and similar heavy volume) users. In other words, if you want
> to average it out and set a 'flat rate', telco still won't be the 
> loser, but the majority of the users will be. He mentions two areas
> where people voted against measured service but exactly the opposite
> was the case in Chicago in the middle 1980's when IBT dropped its
> 'metro calling plans' in favor of pay-as-you-use it. Yes, the modem
> users screamed bloody murder, but all sorts of telephone users other-
> wise were happy to see their bill go down a couple dollars monthly.
> One of the major consumer organizations here endorsed the new plan
> without reservations. Flat rate calling plans work much the same way
> as insurance actuarial tables: let a few people in a given category
> cause some major expenses and everyone pays. I can't say that I
> benefitted from measured service here (in fact I wound up paying more
> than before by quite a bit) but it is a lot fairer to the 99 percent
> of the public who does not use modems or stay on a phone connection
> for hours at a time each day.   PAT]

Pat, it sounds to me like you are willing to accept lower rates in the
short term while giving up a considerable measure of control over your
phone bill in the long run.  I'm not arguing that people who take
measured service don't often save money at first; in fact, I think
it's been designed that way.  The phone companies aren't above giving
up a little revenue in the short term if they see the potential of
making greater profits in the long run.  My point, which you seem to
have overlooked, is that the costs to the phone company are rarely
increased by increased usage of telephone service, especially by
residential customers.  Therefore, it is arguably fairer to charge for
phone service in a usage insensitive manner.  The people of Maine and
Oregon obviously thought it was fairer to do it that way.  (By the
way, I don't have much use for most "major consumer organizations"; I
find they often have their own axes to grind.  But, that's another
topic for another time).

You say that measured service "is a lot fairer to the 99 percent of
the public who does not use modems or stay on a phone connection for
hours at a time each day."  I would agree with you IF the phone
company's costs were being driven up by those customers, but I've yet
to see any evidence that they are.  Keep in mind that we're talking
about residential customers here, and residential customers very
seldom make heavy use of the telephone system during peak calling
periods.  Sure, a residential user may talk for hours at a time, but
if it's in the evening when the central office which is loafing along
at a fraction of its total call handling capacity, what does it
matter?

Keep in mind that since the phone company is a monopoly, they can
juggle the rates any way they want.  Suppose that when IBT introduced
measured service in Chicago, they had chosen to price it in such a way
that the average customer would have paid more than they did under the
previous plan?  They could have done that, you know, but obviously
they wouldn't have had many takers for measured service if they'd done
that.  But if they had, perhaps now you might now be arguing that flat
rate service is the better deal?

I think that what many of the Baby Bells (and GTE) would like to do is
get mandatory measured service in everywhere.  Why?  Because it makes
rate increases easier to justify.  Under flat rate service, when
customers complain that their bills are too high, the PUC just might
order the telco to lower their rates, or at least not approve any new
rate increases.  But when customers have measured service, then it's
easier for telco to place the blame for high bills on customers: "If
they want lower bills, they should make fewer calls!"  Of course, if
the day ever comes that virtually everyone has measured service, then
telco can raise the rates so that the "average customer" is paying
MORE than he would have under unmeasured service.  You have to
understand that there's a bit of psychology involved here.  It's often
easier to get a PUC to approve a rate increase of a penny or two per
call than to approve an extra dollar or two per month on the total
phone bill.  It's like the AT&T commercials where they say "you're
only saving pennies" without pointing out that as the units add up, so
do those pennies.

Right now, none of the Baby Bells have managed to get measured service
throughout their service area, so they haven't been able to jack up
measured service rates as much as they'd like to, because they know
that regulators and consumers in other states would find out about the
increases and use them as ammunition to forestall the implementation
of mandatory measured service in the states where unmeasured service
is still available.

I think that instead of looking at Chicago as an example, it might be
more instructive to look at places where virtually no flat rate
service exists.  Take Europe for example; even in countries where the
phone system is fairly well developed, local phone charges are
considerably higher than ours.  I doubt you will find any place in the
world (outside of the United States and Canada) where people can make
as many calls and talk as long as the average person does here, and
still receive a phone bill that's anywhere near as low as our bills
are.  A lot of those people would truly love the luxury of being able
to pick up the phone and make a local call anytime they feel like it,
without worrying about the costs.  And what they have there is pretty
close to what we would have here, if the telcos could get mandatory
measured service put in place nationwide.

One other thing, you always take swipes at modem users on this issue,
but I think that's even a bit unfair for three reasons.  First, many
modem users are on business lines, and since most business lines are
now measured, they're paying for their service anyway.  Second, most
residential modem users tend to make their calls in off-peak periods,
so they're really not taxing the capacity of the phone system that
much.  But the third thing is that when most telcos here implement
measured service, they charge on a per-call rather than per-minute
basis.  If we were to assume that the point of measured service was to
discourage modem use, then it would make more sense to charge by the
minute on local calls (because modem users tend to make longer calls),
but that's done in VERY few areas of the country.  It would make even
more sense to charge extra only for calls made during the heaviest
calling periods, but as far as I know, that's not done ANYWHERE in the
United States for local calls. So I don't the the phone companies
really have modem users (and people who stay on a phone connection for
hours at a time) foremost in mind when they implement mandatory
measured service, even if you think they're a major target.

The bottom line is that while measured service may seem like a deal
now, I would not assume that such will always be the case.  This is
the phone company's version of a "loss leader", something to convince
you (whether "you" is the individual residential customer or the PUC
of a state) that measured service is a good deal ... and never mind
that there may be price increases around the corner.  Think, Pat ...
their costs are NOT usage based, and they can juggle the price of
either measured or unmeasured service to make either one seem like the
better deal at any point in time.  Therefore, saying that measured
service is "better" because the majority of customers are saving money
with it is in reality making a value judgement based on the conscious
actions of the phone company to make measured service a better deal AT
THIS POINT IN TIME.  When it's the ONLY deal available, you may
suddenly find it's not such a bargain.


Jack

------------------------------

Date: Sun, 16 Jan 1994 00:19:06 -0500
From: goldstein@carafe.tay2.dec.com
Subject: Re: Unmetered Local Service


Imagine, if you will, a new telephone rate structure announced by your
local Bell company, say, Ameritech.

Henceforth, your monthly residential rate will be $2 + $1 for each
letter of the alphabet removed from "A".  Thus Abolafia will pay $2,
Bernstein $3, Coletti $4, up to Zzzyandottie who will pay $27.  This
is perfectly fair, of course, because most people have names that are
before "M", and thus come out in the cheaper half.

Is this absurd?  It is only a bit less arbitrary than most measured
local service plans!  Telephone rates are set by regulators because in
a free market, price tends towards cost, but telephones are a monopoly
so there is no free market.  And in this monopoly world, the historical 
regulatory regime has NOT been cost, but "value of service".  And that's 
basically whatever your regulator says it is.

One approach, of course, is to price telephone service (80%+ of which
is a fixed cost, whether you never use it or never hang up) based upon
usage.  Illinois Bell and New York Telephone both do this a lot.  In
the case of NY City, the state regulators made them do a fancy cost of
service study, and they ended up with a complex three-rate-period
multi-band structure that bottoms out under a penny a minute for
short-haul nighttime calls.  (Residence can get untimed service.)
Note though that NY City has an unusually complex and costly infra-
structure, with so many COs, tandems, etc., to deal with.

The trouble with overcharging for usage is that it reduces the
economic efficiency of the network as a whole. Overprice (vis a vis
true cost) usage rates discourage usage, so the usage-insensitive
infrastructure (most of it) gets less usage than it should.  The
resource is wasted.

The FCC makes telcos produce true cost data when making up the rates
charged to long distnace carriers for delivering calls.  These rates
are then buggered by a formula that produces a subsidy (read: they're
marked up), and they're entirely usage-based.  But the mileage
component is only about 1/100 of a cent per mile per minute.  A call
anywhere in a LATA usually costs about the same.

Overcharging heavy local users or overcharging people named "Townson"
is equally wrong.


fred

------------------------------

From: dk@crl.com (David A. Kaye)
Subject: Re: Unmetered Local Service
Date: 15 Jan 1994 20:30:49 -0800
Organization: CRL Dialup Internet Access   (415) 705-6060  [login: guest]


Jack Decker (ao944@yfn.ysu.edu) wrote:

> 1) Telephone CUSTOMERS do not want to be charged on a per-call or
> per-minute basis.  This was actually put to a vote of the people in at
> least two states (Maine and Oregon, back in 1986 I believe), and in
> those states the people voted to ban mandatory measured service by a
> considerable margin. 

In Oregon US West does provide flat rate service for both residential
AND business customers.  The Portland local calling area extends fifty
miles!  It's amazing.  It is also probably one of the reasons why
business bypass service is not popular in that area, whereas in San
Francisco it is a booming business (measured business rate and a local
calling area of about ten miles).

------------------------------

Date: Sat, 15 Jan 94 16:39:34 CST
From: varney@ihlpe.att.com
Subject: Re: Unmetered Local Service
Organization: AT&T


In article <telecom14.32.1@eecs.nwu.edu> ao944@yfn.ysu.edu (Jack
Decker) writes:

> On Wed Jan 12 08:35:33 1994, lars@Eskimo.CPH.CMC.COM (Lars Poulsen)
> wrote:

>> A. Padgett Peterson (padgett@tccslr.dnet.mmc.com) wrote:

>>> If an employee is worth telecommuting, even a $4/hour connection
>>> charge is fairly minor in the face of, say, a $65,000 salary/benefits
>>> package. Even if you get charged that for eight hours a day, it's minor.
>>> Most employees who would best benefit from telecommuting are the ones
>>> who are well into long-distance calling areas.

>> Many telecommuters will have a local call to an internet carrier's
>> local Point Of Presence. Eight hours at $4/hour is $32 a day. This is
>> at least the equivalent of another hour's salary. Hardly negligible.

> I agree with this last point completely.  I don't claim to be psychic,
> but I will predict that telecommuting will NEVER take off where there
> are per-minute charges involved.  By that I mean it will never get to
> the point where anyone other than the top executives and maybe a very
> few other employees will be allowed to work outside the home.  No
> company in their right mind would pay $32 a day for an employee to
> telecommute when that same employee could drive to work on under $5
> worth of gas, and be physically present when needed.  And keep in mind
> that it wouldn't be just the $4/hour in the example mentioned, there's
> also extra monthly charges for the extra phone lines required, plus
> equipment costs at both ends.  It all adds up.

   I disagree, but only because $4/hour is unlikely -- at $2/hour or
$16 per day, it costs about the same as floor space, parking, taxes,
services, etc.  When urban companies start paying real money when the
number of single-car commuters doesn't drop, telecommuting will be a
real option.

   In addition, it's not the $65K folks that are candidates.  It's the
skilled clerks and sales folks.  If you can pay these people $2/hour
less in salary/benefits in exchange for work-at-home (or work-in-the-
car), telecommuting looks pretty good.  Better yet, you can compete 
for workers that would be unwilling to commute to your work site --
those with small kids, a sick parent or poor access to transportation
will usually work for less in exchange for a presence at home (perhaps
part-time).


Al Varney

------------------------------

From: rrb@deja-vu.aiss.uiuc.edu (Bill Pfeiffer)
Subject: Re: Unmetered Local Service
Date: Sat, 15 Jan 1994 20:26:56 CST


> [TELECOM Digest Editor's Note: The thing Jack Decker and other pro-
> ponents of flat rate billing seem to forget or ignore is that in most
> instances of measured billing, the majority of telephone subscribers
> actually pay LESS for service than with flat rate.  A small minority
> of the users -- mainly people with telephone intensive lifestyles such
> as modem users -- pay more. 

Please, Pat.  That is not at all true.  I know of nobody (yourself
included) whose bill has decreased with measured service.  Yes I know
that the telcos propaganda said this would be true but it is not true
for anyone who uses the phone.  It is not even true for those who
dont.  Basic service is way up, supplemental charges are up too.

> Where flat rate service exists, the rate is invariably evened out in
> such a way that telco still makes money based on average usage which
> tends to run high on the curve due to modem (and similar heavy volume)
> users.

Hogwash.  When we had callpacks here, you still had the option of
measured zero service where each call cost roughly what it does now.
Noobody was forced to take any callpacks.  They took them because they
made sense to consumers.  We had several 'paks' to choose from too,
including certain numbers of units, on up to unlimited and super
unlimited, which reached almost everywhere in the LATA.  All that this
measured service has done is make timed toll calls out of calls which
were untimed local calls and have driven the average phone bill up,
not down.

> He mentions two areas here people voted against measured service but
> exactly the opposite was the case in Chicago in the middle 1980's when
> IBT dropped its 'metro calling plans' in favor of pay-as-you-use it.

Er, I don't remember any vote in Chicago where the 'opposite' happened.
I remember the company notifying us that our callpaks were to be termin-
ated and how wonderful it will be.

> Yes, the modem users screamed bloody murder, but all sorts of
> telephone users otherwise were happy to see their bill go down a
> couple dollars monthly.

 ... while most other people who actually USE their phones saw their
bills skyrocket.  Sure Gramma and Grampa with their rotary black phone
who call junior once a month on the next block, saves a couple of
bucks but most people, I feel, saw dramatic increases.

In Chicago you have an eight mile radius from your CO to the called CO
for a one time charge of about five cents.  If your CO is on the lake,
however, your eight miles east is nil.  What was once an untimed call
from the North side of Chicago to the South side (even under measured
zero in the call-pak days) is now timed by the minute.

> One of the major consumer organizations here endorsed the new plan
> without reservations. Flat rate calling plans work much the same way
> as insurance actuarial tables: let a few people in a given category
> cause some major expenses and everyone pays. 

Sorry, Pat, that is just untrue.  You are sounding like the public
relations drone for Bell.  Flat-rate services were a choice, not a
requirement.  You had choices of what level you needed too.

> I can't say that I benefitted from measured service here (in fact I
> wound up paying more than before by quite a bit) but it is a lot
> fairer to the 99 percent of the public who does not use modems or stay
> on a phone connection for hours at a time each day.  PAT]

99%?  You are telling us that 99% of the phone users in 1990's have
benefitted from measured service?  I'd love to see those statistics.
Pat, I know you love to defend the corporations while they are, at the
same time, sucking you dry, but c'mon ol buddy, lets get real.  This
is the 1990's.  Everyone uses the phone.  The days of granny in her
apartment who made five calls a month are, for the most part, history.
And your modem calls have not driven you bankrupt.  You and I make
virtually all our modem calls to local, untimed numbers.

Telcom instituted measured service to make more money, not to save
money for users.  Period!  To suggest that the majority of telephone
subscribers are better off with measured service than they were with
call-paks and calling plans, is absurd.  What has happened is that
our choice over the most economical plans have been removed.  In their
place is public relations jive.

Pat, I love your Digest, and we are personal friends, but when I hear
you preach of how benevolent telecommunications corporations are and
how much better we all are off because of their actions, I have to
jump in and say 'wake up'.


     William Pfeiffer - Moderator/Editor     
Recrec.radio.broadcasting - Airwaves Radio Journal
              - Internet email -            
Article Submission: articles@airwaves.chi.il.us 
Subscription Desk:  subscribe@airwaves.chi.il.us

------------------------------

From: Cliff Sharp <clifto@indep1.chi.il.us>
Date: Sat, Jan 15 23:49:54 1994
Subject: Re: Unmetered Local Service


In article <telecom14.32.1@eecs.nwu.edu> our Esteemed Moderator writes:

> [TELECOM Digest Editor's Note: The thing Jack Decker and other pro-
> ponents of flat rate billing seem to forget or ignore is that in most
> instances of measured billing, the majority of telephone subscribers
> actually pay LESS for service than with flat rate. A small minority
> of the users -- mainly people with telephone intensive lifestyles such
> as modem users -- pay more. Where flat rate service exists, the rate

   Now, waaaaait a minute.

   When Call-Pak Unlimited disappeared from the Chicago area, my
calling patterns changed dramatically.  The very first month of
measured service, I went from 3500 units to 800, and my bill _doubled_
from around $40 to over $80.  My average bill today is about $120,
custom features excluded; the way I figure it, over ten times what I
used to pay per unit.  In any event, the smallest bill we've had since
was much larger than the largest bill we had during the Call-Pak days.

   I have yet to meet _anyone_, even the little old lady downstairs
with a retirement income who seldom calls anyone, whose bill went down
when Call-Pak disappeared.  (Perhaps you'll be the first?)  A few
people told me their bills went up only 50% or so; one only went up
25-30%.

   My modem line is NOT included in the current $120 figure; perhaps I
should add in the $60 I spend on that to even it out, since I used one
line for everything in the Call-pak days.  (Make it $40 to remove the
charges for the second line.  That keeps everything down to about 13
times the original cost.)

> I can't say that I benefitted from measured service here (in fact I
> wound up paying more than before by quite a bit) but it is a lot
> fairer to the 99 percent of the public who does not use modems or stay
> on a phone connection for hours at a time each day.  PAT]

   Guess you won't be the first (see above) after all ...

   I still can't see why it costs me more for a one-hour, 2 AM modem
call across town than it costs Mabel down the street for a prime-time
half-hour yap with Gert across town.  It certainly costs the phone
company a LOT less, in raw dollars as well as in actual resource
allocation.  (Non-Chicago-area folks: the 9 PM to 8 AM discount is
40%.)


Cliff Sharp    clifto@indep1.chi.il.us     WA9PDM

------------------------------

From: TELECOM Digest Editor <telecom@eecs.nwu.edu>
Subject: Re: Unmetered Local Service
Date: Sun, 16 Jan 1994 09:00:00 CST


Some responses are in order on this cold day in Hell ... for the past
39 hours (Friday about 6 PM through Sunday at 9 AM) the temperature in
Chicago and suburbs has been sub-zero with a drop to fourteen below zero
Friday overnight into Saturday morning; a 'high' temperature of two below
zero Saturday and eleven below last night. We're told things may 'warm
up' to the single digits today. None the less, it warms my heart to read
messages from you guys singling out telco as the one utility service 
which you feel should be an exception to the 'pay for what you use' rule.

Would you like to pay for your electrical service based on some average
amount that all your neighbors, including the big factory across town
uses?  The factory would love having the electric bill averaged out to
some community-wide fee per month. Would you object to paying a flat rate
for your gas or your water based on some amount which includes the public
laundry down the street with all the washers and dryers running all the
time? Betcha the owner of the laundry would consider it to be 'fair'. 

Jack Decker agrees with me that frequently (but only 'at first' in his
opinion) the costs to many subscribers are lower, and on this point he
apparently would be in disagreement with Bill Pfieffer and Cliff Sharp
who feel the bills always are more. Jack says the catch is that telco
is willing to promote what is sometimes called a 'loss-leader' in
order to later present a more palatable dinner to the regulators. It is
easier to get them to go along with a half-pence or so here and there
than a dollar or two per month. Jack contends that the use of the
phone does not affect telco's costs, and while that is partly true
(and more true than it is in the case of the gas, electric or water
utilities, all of whom have to obtain and pay for (or 'manufacture' in
the case of electricity) the product they are passing along), it is 
not entirely true since the size and extent of the *common equipment*
telco must install and maintain DOES depend on the extent to which it
is used. The general public does not know this, but I would expect
most telecom readers to realize that telco does not have wires from
every phone to every other phone and that said wires sit there idle
in between calls. The common equipment is continually being swapped
around among users of the moment. Typically, a telco has the physical
capacity to serve only about ten to fifteen percent of its customers
at any one time. If its customers tie up the common equipment for long
periods of time then more common equipment is needed. Consider the
car rental business: Hertz had a couple million customers last year.
They do not own a couple million cars, but rather, they own a few
thousand vehicles which are constantly being shuffled around among
customers and locations (where the company operates) to meet the
demand at the company's busiest times. Ditto with telco. 

While Fred G. seems to think it is equally absurd to charge by
the letters in one's last name as it is to charge by the amount of
usage, he ignores the fact that one's name has no relevance to one's
use of the phone while one's use of the phone has a direct relevance
to the amount of equipment telco must maintain to make it all work right.
I agree with Fred that my name has no bearing on anything, but the 
fact that I have tied up a circuit between Skokie and Evanston for
awhile typing out this answer does have a bearing on the cost.

Jack suggests looking at Europe where 'costs are considerably higher'.
Yes, they are higher in Europe (where they also have virtual monopoly
phone service in a few countries), and yes phone charges are higher
in any event. But this is not due to measured service, it is due to
the lack of technological development in telecom. You don't wait three
years to get phone service in the USA as you do in some places in
Europe either. In general, phones cost more and provide less value
in Europe than in the USA regardless of how the bill is calculated.

Bill Pfieffer does not recall 'any votes in Chicago' and that is
because there were no votes taken. But the Consumer's Utility Board
(known locally as CUB) which functions as a citizen's 'watchdog' of
the state regulators (the Illinois Commerce Commission) said they
liked the idea of measured service for the simple reason that the old
plan (a combination of measured and unmeasured 'local community service'
plus area-wide metro 'call-pak' and 'unlimited call-pak' service was
grossly unfair to the suburbanites while being overly generous to
residents of Chicago. I would agree in general with Jack Decker's side
note about 'consumer groups with their own axes to grind' and was very
surprised to find myself in basic agreement with CUB's premises at 
the time. 

As Bill points out, we now have an 'eight mile local zone' in which
residence calls cost but a single 'unit' and are untimed. A 'unit' is
roughly three to four cents and we get discounts on this based on the
time of day and the number of units used per month. The local zone is
all the exchanges in the central office serving you plus all the
exchanges in the contiguous central offices. All of northern Illinois
(not just Chicago) is now under this plan. What Bill says is true: the
subscribers who live along the lakefront do not get eight miles to
the east since there are no central offices out in Lake Michigan, but
they do get eight miles north, south and west. 

Under the old plans, there were a number of flaws which made them
unfair to various users. For example, every user had untimed local
calling with calls *in the corporate limits of his community* rated at
one message 'unit'. Talk one minute or talk all day, no matter. For
people in Golf, Illinois (a tiny village right next to Skokie) that
meant one exchange, and a distance of five blocks from one side of the
village to the other. For people in Chicago, that meant a distance of
*thirty miles* from one side of town to the other at the most extreme
angles of direction; easily 25 miles for everyone else and dozens (in
those days) of exchanges. Under the old local plan, we got 80 'units'
per month to use as we saw fit as part of the monthly fee. You could
make 80 (or 120, 180 or 240) local calls or some lesser number of
calls to other communities with the number of 'units' charged being
based on time connected plus distance. That part was fair enough, but
if one decided to get 'unlimited call pak' (the next step above 240
units) because one was on the phone a lot, then guess what? If you
were calling anywhere outside the so-called 'inner met area' your
units didn't matter ... those calls were coin-rated, and your units
were wasted. Grandma might not use a single one of her 80 units
allotted as part of her monthly bill, but every Sunday afternoon when
she called Bill's friend Junior out in Aurora she'd get nipped for
forty cents in coins. 

Under the old, highly-touted (by some people, and admittedly while
I lived in Chicago-proper I was one such person) 'unlimited call
pak plans' all the plans were heavily biased in favor of Chicago
residents to the detriment of the suburbanites. All the plans used
as their territory a starting point of State and Madison Streets in
downtown Chicago then expanded outward in rings or circles. The
'inner met area' was 28 miles *from downtown Chicago* in any direc-
tion. That was fine if you were in downtown Chicago or even anywhere
in Chicago. The poor guy who lived in Wheaton, Illinois could call
*anywhere* to the east/northeast/southeast on that plan but if he
wanted to call west/northwest/southwest he had about three or four
city blocks he could call under the unlimited plan then *his* calls
became coin-rated for westerly points. The next size unlimited
call-pak went forty miles *from downtown Chicago* and picked up such
places as Aurora, Illinois on the outer edge of (what was then 312
and now is 708) plus bits here and there of 815. Well, that was fine
until you moved to Fox Lake, Aurora, Zion, or Joliet to name a few
examples. Then you were on the outer edge of the 'outer-met unlimited
call-pak area' and you could call north and east all you wanted but
not south or west (if Zion or way up north then the reverse was
true; you got calls south and to a limited extent west, but being
on the lake you got nothing east and you bumped into the Wisconsin
state line a mile or two north of you and a whole new LATA). So
people living in the outer suburbs had quite a choice for phone
service: local area which gave them their puny little town with all
of one or two exchanges or they could get 'outer-met unlimited service'
based on rates and mileage from downtown Chicago from which they
were already removed by forty miles or so. There was no inbetween
type plan for those people. 

A very sensible plan was developed where the entire northern Illinois
area would be treated as one large metro area for local calling. All
'local' zones would be relative to where you were actually at and all
'local' zones would be the same size regardless of what town you
actually lived in. Everyone across northern Illinois gets eight miles
in any direction from them. Telco does not choose who lives by the
lake and who lives elsewhere. Anyway, as a side note, along the lake
is **so bad** now in terms of nasty people, nasty violent crimes, drug
sales, run-down and horrible housing, etc I can't imagine why anyone
would live there; I'll sure never return to Chicago/Rogers Park having
had a taste of Skokie! But, we get eight miles in any geographically
possible direction, we pay three or four cents per *call* for these
(or less depending on time of day and volume of calls per month dis-
counts) and we pay progressively more for each cluster of phones in
eight mile groups beyond that. What could be fairer to *everyone* in
a large metro area than that?  That is, assuming you agree with my
premise that the number and duration of calls does cost telco *something*
even if the analogy to gas and electric service is not entirely right.

Part of the problem is the government did not lay out all the villages
and towns on a checkerboard pattern with the same population in each
town and the same boundary lines, etc. We have some real weird layouts
here and any 'local flatrate in your own community' type plan would
never be fair. I agree they might have as an alternative developed
some additional 'unlimited call-pak' plans with concentric rings whose
centers were in places other than (in addition to) smack-dab in
downtown Chicago favoring downtowners at the (increasing) expense of
all other residents as far away from downtown as you went, but they
did not. Instead they developed a checkerboard pattern with each
person getting his own square and the squares on any side of him. The
rates *were* reduced (under the old plans, 'units' cost 5.5 cents each
where now they cost between 3-4 cents depending on how many and time
of day) and the suburbanites gained some equality with the city
people.

Of course modem users *in the city* who had previously been able to
call *anywhere else in the city* for that 5.5 cents per call (with a
bundle of 80/120/180/240) as part of the prepaid package now lost
large chunks of the city in exchange for picking up in many cases
quite a few suburbs in the process at 3.5 cents per call, but the
suburbanites in many cases doubled or tripled the territory they could
call for their 5.5 cents at a new rate of 3.5 cents.  Instead of a
choice between very local and limited 'flatrate' service at a cheap
cost or an area-wide plan which cost a fortune and only included
calls aimed in the direction of downtown Chicago, suburbanites now
get to call anywhere in their 'square' or the 'squares' around them
at a decent rate. 

For telco, the switch from flatrate to measured was more or less
revenue neutral here. The fact that phone bills are higher now is
because we are using the phone more now than we were even ten years
ago. The modem users disliked it because frankly, quite a few were
accustomed to calling BBS's (in those days Internet connectivity was
virtually zilch, we all dealt only with small systems around the area)
all over the metro area -- a distance of several hundred square miles
 -- and staying on line for an hour at a time. And you can't tell me
that the 'average' phone user spends an hour at a time, several times
per day, or even several times per week) calling to a point 30-40
miles away. The fact is we can say in voice to one another in a minute
or two that which takes 15-20 minutes or longer to type in via email
or a message and most people do NOT construct stuff off line then call
in to deliver it. They call the system they are using and construct
their message then and there. That's why modem connections are going
to be inherently longer than voice connections, and that is why the
modem users screamed about measured service, for the same reason the
factory would love to have its electric and water usage on flat rate
instead of meter.

So often, 'what is best' is an applications-driven thing. Our old
plans here *sucked* -- they were great for inner city Chicagoans and
lousy for everyone else with the exception of heavy volume residential
users in certain particular locations such as (go ahead and admit
it Bill and Jack) inner-city modem users. Some phone customers here
such as modem users calling all over the metro area and hanging on
for hours at a time got a free ride for years. Now instead, Grandma
gets to call Aurora or Zion without seeing a forty cent per minute
coin-rated charge on her bill. So there is no mistake in where I
am coming from, measured service costs me MORE -- much more, and I
do not like it *for myself*, but overall, if you care about the rest
of the greater metropolitan community, it is fairer this way.  


Patrick Townson

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End of TELECOM Digest V14 #33
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