December 2, 2010
Writer?s Direct Dial: 703.755.6730
Facsimile Number: 703.755.6740
Sheba.Chacko@bt.com
Via Electronic Filing
Ms. Marlene H. Dortch
Secretary
Federal Communications Commission
445 12th Street, S.W.
Washington, DC 20554
ERRATUM -- EX PARTE LETTER
RE: Universal Service Contribution Methodology,
WC Docket No. 05-337, WC Docket No. 06-122 & GN Docket No. 09-51
Dear Secretary Dortch:
On November 30, 2010, BT met with FCC staff to discuss Universal Service
Contribution issues. Representing BT were Sheba Chacko, Jillian Mertsch, and Linda Cicco.
BT met with Vickie Robinson, Carol Pomponio and Nicholas Degani of the Wireline
Competition Bureau.
During this meeting, BT explained why it is urgent that the Commission address
contribution reform. The fund is cumbersome, burdensome, unclear and unstable. There are
tremendous uncertainties and varieties of interpretations in the industry regarding many aspects
of the contribution regime. Some providers bidding for customers? services may be subject to
the contribution requirement while others are not, creating a skewed playing field. Finally, the
impact of miscellaneous federal and state regulatory fees is huge adding an additional 16%-18%
in regulatory fees alone to a customer?s invoice. When federal and state taxes are layered on top
of regulatory fees and base rates for telecommunications services, customers can pay
assessments as much as 30%-33% above base rates. Ironically, the size of these assessments
dwarf ?sin? taxes which are assessed on goods or activities whose use the government is trying
to discourage, unlike the case of telecommunications services.
Therefore, BT urged staff to act promptly to reform the contribution mechanism by: (i)
expanding the base of contributors (e.g., by requiring all providers whose services contain a
telecommunications component to contribute to the fund); (ii) simplifying the mechanism; (iii)
implementing brightline tests; and (iv) ensuring a level playing field.
Ms. Marlene H. Dortch
December 1, 2010
Page 2
If you have any questions regarding any matters discussed herein please contact the
undersigned.
Sincerely,
Sheba Chacko
Head, Global Operational Regulation and Americas
Regulation - BT Global Services
cc: Vickie Robinson
Carol Pomponio
Nicholas Degani
Sharon Gillette
Paul deSa
Zac Katz
Margaret McCarthy
Angela Kronenberg
Bradley Gillen
Christine Kurth