Can A Telco Block Phone Calls To A Number They Don't Like?

from the they're-trying dept

If you're involved with startups these days, you've probably used FreeConference.com. It's become the de facto conference call system for many startups. Basically, it lets you create conference calls for just the cost of the long distance call to the number provided (usually in Iowa or Minnesota). Since many phone plans these days include unlimited long distance, there isn't even much of a cost for most users. I used to think that the business model behind FreeConference.com was to upsell people to more feature-complete conference calls (as well as ones that didn't provide a little jingle for FreeConference.com at the beginning -- for people who didn't want big name customers or partners knowing they were using a free service). However, many have suggested that the real business model was the same as those services that offered free international calls: arbitrage over termination fees. Since regulators put in place ridiculously high termination fees (the fees other telcos pay local telcos for connecting a call to that telco's end user) there was an arbitrage opportunity. These services could set up deals with the local telcos, drive many more calls to those local exchanges. The local telcos then get a ton of cash from the termination fees, and gives some of it back to the service that drove all that traffic. In the case of the free international calls, AT&T decided to sue the company for fraud.

However, it looks like the various telcos have taken a different strategy when it comes to FreeConference.com: they're simply blocking callers from calling that number. Think about that for a second, because it's quite troubling. The telco is deciding that they don't want you to be able to call certain numbers -- and then just blocking them, leaving no recourse. Apparently some people can still get through, but others are having trouble. It certainly has some similarities to the whole network neutrality debate. The FCC tends not to take kindly to telcos blocking anyone's ability to call anyone else -- though, in the past, it's usually smaller telcos doing the blocking, rather than the Kevin Martin's buddies at the big telcos. Either way, it seems pretty sleazy to suddenly block the ability to call certain numbers. The problem isn't with these services, but the bad regulations that allowed the small telcos to charge crazy termination fees in the first place. If the big telcos have a problem with it, they should take it up with whoever put those laws in place.


Reader Comments (rss)

(Flattened / Threaded)

  1.  
    identicon
    Sanguine Dream, Mar 16th, 2007 @ 12:03pm

    Wow...

    First the idea of internet telcos blocking certain sites.

    Now the idea of phone telcos blocking certain numbers. That would suck if somehow (I doubt its possible but I often think in worst case scenario) a legitimate number was block by mistake.

    What's next controlling what stations I can hear on the radio?

     

    reply to this | link to this | view in thread ]

  2.  
    identicon
    TheDock22, Mar 16th, 2007 @ 12:24pm

    Re: Wow...

    That is pretty dang scary. I would be sad if my number was put on the unacceptable list.

    Although, I wish this could to our advantage and block all telemarketing company. That Do-Not-Call List is a joke.

     

    reply to this | link to this | view in thread ]

  3.  
    identicon
    Scott, Mar 16th, 2007 @ 1:03pm

    Nothing new....

    I've noticed for years at payphones that operator calls are redirected to a third party, 1010288-0 is redirected to the same third party operator...Hmm then when i try 1-800-CALL-ATT or 800-877-8000 (Sprint) etc those calls are aslo redirected. Yes this is illegal in Ohio and they still do it. Enforcement here is lax...Even when I report them they continue to do it.

     

    reply to this | link to this | view in thread ]

  4.  
    identicon
    Rick, Mar 16th, 2007 @ 1:12pm

    I've had an issue with AT&T charging people who live near me long distance rates to call my LOCAL Skype-In number. Some of my friends, without unlimited long distance plans, are told to hang up and dial 1+area code in order to make the call connect- even though we live in the same metro area code.

    It's not always about arbitrage, they are trying to protect their monopolies and mega-profits as discretely and even illegally as they can.

     

    reply to this | link to this | view in thread ]

  5.  
    identicon
    bfernald, Mar 16th, 2007 @ 1:23pm

    Raise a glass to market freedom

    Two wrongs don't make a right, and so I'm all for telcos blocking numbers to respond to their exploitation by Free Conference.com. No company, monopoly or otherwise, should be compelled to connect these calls. This is just the market's way of adjusting to poor regulations.

    Furthermore, if there really is a demand by telco customers to access FreeConference.com phone numbers, I'm sure the telcos could offer to pass the termination fee on to the caller. A voice message asking for acceptance of the fee would provide customers access to the number and transparency to its status.

    Again, this is just the free market in action. It's beautiful, but has a mind of its own.

     

    reply to this | link to this | view in thread ]

  6.  
    identicon
    William, Mar 16th, 2007 @ 1:23pm

    How about if they only connect me to some of the numbers I call. I only pay some of my bills when they send them to me. They are a customer service company and not a whatever. I don't even know what to say here.

     

    reply to this | link to this | view in thread ]

  7.  
    identicon
    KB, Mar 16th, 2007 @ 1:26pm

    Re: Wow...

    "What's next controlling what stations I can hear on the radio?"

    By stifling webcasters with new legislation and effectively closing down smaller stations who cannot afford royalty fees, the industry is doing just that.

     

    reply to this | link to this | view in thread ]

  8.  
    identicon
    Elvinkneekapper, Mar 16th, 2007 @ 1:35pm

    It happens

    I used to work for a Telco, smaller but it was a national one. They did block numbers that were cost prohibitive to them on a semi-regular basis...this is not unusual to my knowledge.

     

    reply to this | link to this | view in thread ]

  9.  
    identicon
    Kentucky Fats, Mar 16th, 2007 @ 1:58pm

    Raise a glass to market freedom

    Let me guess,your're a republican?

     

    reply to this | link to this | view in thread ]

  10.  
    identicon
    Anonymous Coward, Mar 16th, 2007 @ 2:28pm

    Re: Wow...

    That would suck if somehow (I doubt its possible but I often think in worst case scenario) a legitimate number was block by mistake.
    It is a legitimate number that they are blocking.

     

    reply to this | link to this | view in thread ]

  11.  
    identicon
    Kyle K. Wilson, Mar 16th, 2007 @ 2:46pm

    Re: Raise a glass to market freedom

    Two wrongs don't make a right
    But then you're "all for" it.

    No company, monopoly or otherwise, should be compelled to connect these calls.
    Sure they should. Why not? Just because some turf troll says so?

    Again, this is just the free market in action. It's beautiful, but has a mind of its own.
    Just the opposite, this is a government protected monopoly abusing its power "in action".

    "Freedom" does not include taking other people's freedom away. That's tyranny.

     

    reply to this | link to this | view in thread ]

  12.  
    icon
    Derek Kerton (profile), Mar 16th, 2007 @ 2:46pm

    There Is NO Good Guy

    FreeConf, which I've used for years, as it turns out is profiteering from loopholes in regulations, and that's a crappy way to run a business, and surely not one you'd want to invest in. It is a slimy way to make a buck, by taking advantage of another company's obligation to pay high termination fees.

    FreeConf is also slimy because of the email they sent me asking me to fight their battle for them with the FCC and big telcos. Their email suggests that the only reason that AT&T et al are attacking them is because they are afraid of competition in the conferencing market. By not mentioning the true reason (termination fee arbitrage), they are effectively lying to me, and urging me to contact the FCC on their behalf with false information. That makes them jerks in my books.

    But the telcos... Ah the telcos. Regulations not going in their favor for once? Sounds like a big can of "what comes around goes around" to me. Listen, I'm not the one responsible for the terrible telecom regulation, and the Gordian knot of business models they've built up over 100 years. They are. Tough beans if it's not working for you for once. Go use your armies of lobbyists to block the loopholes, and for once I'll even support you.

    But don't turn us customers into collateral damage in your little termination fee spat. Selectively blocking legit numbers that I dial is the surest way to get my hair standing up on end, and make me think that perhaps regulation on Net Neutrality isn't such a bad idea. If telcos think they can just block legit phone numbers (that just happen to be in Iowa) at their whim, citizens better watch their backs.

    Telcos offer free long distance, and make big ARPU on every account. Mobile phone carriers sell huge bundles of minutes that go unused every month. So suddenly, customers have a way to use those minutes and free long distance plans, and it doesn't suit the telcos. Tough, they still owe us the services we bought.

    So maybe we *should* complain to the FCC. But not just in the way FreeConf asked me to. Everybody is a bad guy here. The FCC for lousy regs, FreeConf for being dishonest about the issue and existing only in a loophole, and the telcos for heavy-handed reactions that show their true colors. I suppose the paying customers just get lost in the shuffle.

     

    reply to this | link to this | view in thread ]

  13.  
    identicon
    Lula C. Brown, Mar 16th, 2007 @ 3:04pm

    Re: There Is NO Good Guy

    FreeConf, which I've used for years, as it turns out is profiteering from loopholes in regulations...
    A loophole is an omission or ambiguity in the wording of a law that provides a means of evading compliance. I don't see that here. Claiming otherwise seems "slimy" to me.

    By not mentioning the true reason (termination fee arbitrage), they are effectively lying to me...
    How do you know that's what's going on? Are you making stuff up? You're starting to sound an awful lot like a telco shill.

     

    reply to this | link to this | view in thread ]

  14.  
    identicon
    Anonymous Coward, Mar 16th, 2007 @ 3:12pm

    yet another reason

    yet another reason to dump the big phone companies and go with vonage - none of those numbers is blocked with vonage.

     

    reply to this | link to this | view in thread ]

  15.  
    identicon
    gman, Mar 16th, 2007 @ 3:58pm

    Re: There Is NO Good Guy

    Cingular doesn't dictate termination rates - that is regulated by the FCC. Pricing to the competition instead of their cost is the problem here. Cingular does set the rates they charge their customers and they should charge their customers enough money to cover the cost of their customers usage with out blocking numbers.

    Otherwise all termination fees will be to high in the eyes of Cingular.

    Cingular would block any numbers they wanted to block if that was the case.

    And eventually the Public Switched Telephone Network wouldn't work

    That is why the FCC dictates what these companies can charge. The FCC has also ruled that carriers can not block calls because they have a dispute over fees.

    Cingular is ignoring that blocking the calls - hurting numerous businesses that use these services and hurting businesses that supply these services.

    Shame on Cingular, they know that if there is a problem they can take it up with the FCC.

     

    reply to this | link to this | view in thread ]

  16.  
    identicon
    MonopolyMan, Mar 16th, 2007 @ 4:33pm

    No Free Market when Right of Way is concerned!!

    @Raise a glass to market freedom

    Sorry, the telcos/cable/wireless companies can have their "Free Market" when they give up Right-of-Way benefits. Otherwise you and them can quit flapping about the "Free Market" propaganda

     

    reply to this | link to this | view in thread ]

  17.  
    identicon
    Steve R., Mar 16th, 2007 @ 4:35pm

    More shanigans

    In July 2006 Cnet reported the following:
    "A class action lawsuit charges that Cingular Wireless, the nation's largest carrier, deceived AT&T Wireless subscribers into paying extra fees and degraded their service after acquiring that company in 2004."
    http://news.com.com/Cingular+accused+of+duping+ex-AT38T+subscribers/2100-1039_3-6091853.html

    Anyone know what happened with this?

     

    reply to this | link to this | view in thread ]

  18.  
    identicon
    big brother, Mar 18th, 2007 @ 7:40am

    Re: Wow...

    "What's next controlling what stations I can hear on the radio?"

    Yup

     

    reply to this | link to this | view in thread ]

  19.  
    identicon
    Anonymous Coward, Mar 18th, 2007 @ 12:07pm

    The FCC tends not to take kindly to telcos blocking anyone's ability to call anyone else

    Sure, cupcake. Now try calling a 900 or 976 number from Vonage or your cell phone.

    And as far as everyone bleating BUT THE FCC SAYS! THE FCC SAYS! AWK! AWK! they haven't said a damn thing about this. Don't let the bureaucratic camouflage trick you -- I have seen this agency move with lightning speed on critical violations made by the telcos. They haven't said or done anything here, and while it's nice to think that's all a part of the Vast Right Wing Conspiracy[tm], it's not.

    TANSTAAFL, motherfuckers.

     

    reply to this | link to this | view in thread ]

  20.  
    identicon
    Mike C, Mar 19th, 2007 @ 9:36am

    Re: Re: There Is NO Good Guy

    >> FreeConf, which I've used for years, as it turns out is profiteering
    >> from loopholes in regulations...

    > A loophole is an omission or ambiguity in the wording of a law that
    > provides a means of evading compliance. I don't see that here.
    > Claiming otherwise seems "slimy" to me.

    There is plenty of ambiguity here -- calls to rural areas get radically higher termination fees because they are supposed to be terminating down long lines to remote farm houses, not by traveling 30 feet to a rack in the same equipment room as the switch. The ambiguity is in what "terminating" a call means in order to earn the fee - and there is plenty of ambiguity here, just ask two lawyers and hear how long they argue about it.

     

    reply to this | link to this | view in thread ]

  21.  
    identicon
    Bob, Mar 20th, 2007 @ 6:17pm

    The

    For many years the IOWA phone companies named in the ATT (et al) suit were paid 5-cents per minute by LD Carriers to terminate calls on the local Iowa Telephone networks.

    While most local carriers in the USA get less than a penny a minute to terminate a call, IOWA, due to the rural nature of the state, was tariffed at/around 5-cents per minute.

    In reality, since IOWA companies COMPLETE more calls than ORIGINATE, they earned a few thousand dollar a month (profit) on termination fees.

    This was legal and everyone, including ATT played by these rules.

    For most consumers, the rate they were charged to call IOWA was much, much less than the termination fee ATT and others were charged.

    (eg) Boston to Iowa 3-Cents Per Minute to Customer, yet ATT and others have to pay 5-cents per minute to the local companies to COMPLETE the call.

    Consumers with UNLIMITED FREE long distance (ie) cell phones were KILLING ATT, Cingular, Verizon, etc.

    Last summer, the carriers named in the suit, (Dixon, Superior Telephone, et al) unilaterally (and without tariff approval) raised the rate they charge to 14-cents per minute.

    They got very, very greedy.

    Soon ATT, which regularly paid thousands of dollars a month in termination fees, was dishing out $2-Million in fees.

    IF, the local carriers had stuck to their tariffed price, ATT would NOT have a leg to stand on.

    The local telcos SHARED their termination fees with FreeConference.

    There were two ways FreeConference and the local telcos made money.

    -If the call terminated on Freedom equipment in Iowa, the telco and Freedom split the 14-cents per minute termination fee.

    -If someone called FreeConference to place an INTERNATIONAL call, Freedom would transmit the call via VOIP at less than a penny a minute.

    So, if FreeConference was getting paid 7-cents a minute and the cost of VOIP outbound call was a penny a minute, FreeConference was making 6-cents a minute profit.

    The local telco was also making 7-cents per minute.

    The plan fell apart when the owner of FreeConference went on the ABC Evening News and said his company would "beat AT&T at their own game"
    He gave dozens of interviews with tv stations and newspapers.

    ATT got mad and sued.

    Everyone is now suing everyone else.

    The IOWA companies expect to settle with ATT et al without going to trial.

    The presumption is:
    -IOWA companies will NOT admit guilt.
    -They will NOT be paid the termination fees that ATT still owes them for calls made to FreeConference.
    -They will AGREE to resume their tariffed rate of 5-cents per minute to terminate calls.

    Of course it goes without saying, ATT and all the others, DO NOT WANT TO PAY ANYONE, ANYTHING, to terminate their calls.
    They want a free ride on the local networks.

    Both sides here have some dirt on their hands.

    Of course, ANY local phone company in America, legally CAN lease out, their lines to chat services and earn tons of money on termination fees.

    THIS IS TOTALLY LEGAL since the calls TERMINATE at the local level.

    They can also SHARE the termination fees, with the chat service, PROVIDED the chat service does not INITIATE an outbound call to CIRCUMVENT the tariff.

    In some states, California (eg) the chatlines must be placed on a block of numbers that the local telco can BLOCK if a customer requests.

    North Nevada Telco has been earning millions a year running chat lines that TERMINATE at their facilities.

    They also do NOT charge MORE than the tariff rate to terminate calls.
    The long distance companies are powerless to stop them.

     

    reply to this | link to this | view in thread ]

  22.  
    identicon
    Len, Mar 28th, 2007 @ 11:28am

    Resource for Consumers on Call Blocking

    In response to the outpouring of support from bloggers like you, industry thought leaders, consumer interest groups and the media, Free Conferencing Corp. (the creators of FreeConferenceCall.com) has set up a special web site --http://blog.freeconferencecall.com/Default.aspx -- to set the record straight on the call blocking and law suits being leveraged by the major carriers including Cingular/AT&T Wireless and Sprint/Nextel. This site includes links to current blog postings, blocking FAQs, forum for visitors to blog, and, most importantly, a "Know your Rights" section directing people to the Federal Communications Commission (FCC) web site so customers fully understand how their rights are being violated. The Know your Rights section includes links to learning about current FCC regulations, filing a complaint with the FCC, contacting your state attorney general and reading about historic cases that refute the claims of the telecommunications carrier "Goliaths." FreeConferenceCall.com is also encouraging site visitors to subscribe to a list to join the fight in a class action suit.

     

    reply to this | link to this | view in thread ]

  23.  
    identicon
    Anonymous Coward, Mar 28th, 2007 @ 4:21pm

    Re: Raise a glass to market freedom

    Free market? In telcos? What free market? You can go out and string up lines and open up a telephone company where you live?
    If you want a different local telephone service going to your house, you have a choice? really? free market?

     

    reply to this | link to this | view in thread ]

  24.  
    identicon
    Janice Zorovich, Mar 30th, 2007 @ 10:52am

    Brighthouse PLEASE READ

    Bright house put a block on MY HOME phone & I cannot recieve collect calls. the following letter explains what I am going through. My son died & I did not get to speak to him.This is to inform you that everytime I have to address this problem it is tearing me apart piece by piece.It has been 1 year to date that I pleaded for your help and I have not received it.

    My 38 year old Son died on November 27th 2006 Believing that my husband & I abandoned him because everytime he tried to call collect a recording stated” At the CUSTOMERS request they do not accept COLLECT CALLS.”

    December 21,2005 a Bright House Representative ,Attila 1-866-718-7907 ext5230 called my home and told me that I would get the SAME SERVICE at a lower price if I changed from Verizon to Bright house.
    I accepted.

    On March 16,2006 I called Bright House to inform them that I could not receive Collect Calls from my son who was trying to reach me since February. They said that Bright House does not have the option of collect calls.


    THAT IS NOT THE SAME SERVICE.

    I explained to Bright House that COLLECT CALLS are the most IMPORTANT calls in my household due to the fact my son was a recovering addict .

    I would never have changed service from Verizon had the Representative told me the truth.

    I have had phone service since 1968 & have always been able to accept collect calls so when you say SAME SERVICE that is what I expect.

    April 20th 2006 I called Bright House again letting them know I still cannot receive collect calls and my son is still trying to reach us.

    May 10 2006 I filed a complaint with the FCC #11793891.

    July 19th 2006 Bright House Mr. Williams & Mark Galler Communications Supervisors called me in reference to the FCC complaint. I told them the only solution to this problem was:

    When selling the service INFORM THE PEOPLE THAT THE PLAN DOES NOT INCLUDE COLLECT CALLS

    REMOVE the recording that states”AT THE CUSTOMERS REQUEST” and replace it with Bright house does not accept collect calls.

    A letter to all Bright House customers informing them the plan does not include Collect Calls.


    OMIT ‘NO RESTRICTIONS’ from all advertising articles.

    August 4 2006 I filed another complaint to the FCC# 12077779.

    October 5 2006 I filed a complaint with www.naruc.org

    October 7th 2006 I received an email from my son that he still cannot call collect.

    November 27th 2006 Matthew,my son, died

    March 16 2007 1 year to date due to FRAUDULENT sales & advertising tactics I still cannot receive Collect Calls.
    I took all the right steps, I explained the problem, I gave solutions and I waited for help from you, mean while my son was waiting for help from me.

    Can you even begin to understand how horrendous I feel?

    I will never be able to help, hold, or SPEAK to him ever again.

    The last year of my son’s life was not good. I know he felt horrible every time he called us & got the recording “AT THE CUSTOMERS REQUEST’.

    Bright house communications RESTRICTED our communication rights by not giving me the SAME SERVICE that ATTILA & BRIGHT HOUSE told me I would get.

    Now before this happens to someone else, will somebody anybody help me.

    Janice Zorovich
    727-536-0767
    phmelar@tampabay.rr.com
    12151-75th st n
    Largo FL 33773

     

    reply to this | link to this | view in thread ]

  25.  
    identicon
    Nate K, Apr 5th, 2007 @ 9:13am

    Phone Number

    And you could not change back to verizon if collect calls were so important why?!? Just wanted to prove a point?

     

    reply to this | link to this | view in thread ]

  26.  
    identicon
    Janice Zorovich, Jun 10th, 2007 @ 10:44am

    Re: Phone Number

    I could not change back to verizon because Attilla & bright house said they would cancel Verizon.
    Then I started getting a bill for $125.00 from Verizon. Unfortunatly I could not afford the $125 & bright house still has not paid it either. I was in financial problems & thats when brighthouse called with THE SAME SERVICE at a LOWER PRICE.
    Another problem was that when my son relapsed after 5 years sober, he was in California jail & he was extradided to NJ by bus & stopped at numurous jails. EVERYTIME he tried to call the recording stating "AT THE CUSTOMERS REQUEST" they are not taking collect calls. When it should say "AT BRIGHTHOUSE'S they cannot receive Collect Calls.
    Please reply, as any comments will help me understand How Brighthouse or any other COMMUNICATION can get away with vagrent fraudulance.

     

    reply to this | link to this | view in thread ]

  27.  
    identicon
    Bob Reynolds, Jun 23rd, 2007 @ 12:06pm

    Re: Re: Phone Number

    A) Your case for not changing from brighthouse makes no sense. There are plenty of other alternatives. You appear to have nobody to blame for this problem but yourself.

    B) By the sounds of it, it was a blessing in disguise. Your son was a mess.

     

    reply to this | link to this | view in thread ]

  28.  
    identicon
    janice Zorovich, Jul 23rd, 2007 @ 2:31pm

    RE: Phone #

     

    reply to this | link to this | view in thread ]

  29.  
    identicon
    janice Zorovich, Jul 23rd, 2007 @ 2:35pm

    RE: Phone #

    A) name some alternatives

    B) MY son Had an illness. By the sounds of your comment abou it 'being a blessing in disguise, it's OBVIOUS you have an illness too.!

     

    reply to this | link to this | view in thread ]

  30.  
    identicon
    janice zorovich, Jul 23rd, 2007 @ 2:39pm

    Re: Re: Re: Phone Number

    A) what are some of the alternatives?

    B) My son had an illness. And by the sounds of your statement (a blessing in disguise) it's obvious you have an illness too!

     

    reply to this | link to this | view in thread ]


Add Your Comment

Have a Techdirt Account? Sign in now. Want one? Register here
Get Techdirt’s Daily Email
Save me a cookie
  • Note: A CRLF will be replaced by a break tag (<br>), all other allowable HTML will remain intact
  • Allowed HTML Tags: <b> <i> <a> <em> <br> <strong> <blockquote> <hr> <tt>
Follow Techdirt
A word from our sponsors...
Essential Reading
Techdirt Reading List
Techdirt Insider Chat
A word from our sponsors...
Recent Stories
A word from our sponsors...

Close

Email This