Industry’s Wholesale Roaming Rates Reflect Price Gouging By National Operators

NTCA and RTG Provide FCC With Additional Evidence That Inter-carrier Voice and Data Roaming Rates Are Grossly Anticompetitive

For Immediate Release

Contact: Laura Withers, 703-351-2086, lwithers@ntca.org

Arlington, Va. (November 9, 2012) The Rural Telecommunications Group, Inc. (RTG) and the National Telecommunications Cooperative Association (NTCA) today filed an ex parte letter with the Federal Communications Commission (FCC or Commission) that reiterates the long-standing complaint by small and rural wireless operators that the country’s largest operators – especially the Twin Bells, AT&T and Verizon Wireless – continue to charge competitors wholesale data roaming rates that are vastly higher than the retail data usage rates paid by the subscribers of those very same nationwide operators. Attached to the RTG and NTCA ex parte is an in-depth research report created by iGR, a telecommunications industry market research analyst. The iGR report reveals that when it comes to offering retail data rate plans to their own customers, large operators are rather competitive and typically charge prices – even charges for “overage” usage – that are at or below the industry average. However, when offering that same network access at the wholesale level to smaller, rural mobile competitors, the roaming charges levied are 10 to 20 times greater.

Small and rural mobile operators, by their very nature, need to rely on nationwide operators for roaming access so that they may offer their current and prospective customers a nationwide footprint. If those smaller competitors are forced to charge subscribers stiff retail data rates (or forego offering nationwide data access altogether) it all but prevents rural consumers from having the same level of service as their urban counterparts.

The following statement can be attributed to Carri Bennet, RTG’s General Counsel:

“For years RTG has monitored the wholesale data roaming marketplace and found that AT&T and Verizon have done everything in their power to keep small and rural operators from having access to commercially reasonable data roaming rates. iGR’s recent report is further proof that there is no correlation between the costs incurred by large operators to provide data services and the wholesale roaming rates offered to smaller rural carriers trying to extend service to their rural subscribers. The simple fact that AT&T and Verizon Wireless subscribers (at the retail level) pay only a fraction of what small and rural operators must pay for their rural similar roaming access (at the wholesale level) is unconscionable. Today, rural wireless carriers put the Twin Bells on notice that wholesale rates above retail rates will not be tolerated anymore.”

The following statement can be attributed to Jill Canfield, NTCA’s Director of Legal & Industry Affairs:

“Wireless services are critical to the continued success of small, rural carriers as their customers’ appetites for mobile technologies grow. But negotiating roaming agreements remains a huge barrier to these small carriers’ ability to provide the high-quality, competitive wireless services their customers demand. Nearly three quarters of respondents to NTCA’s 2012 Wireless Survey categorized their experience negotiating roaming agreements with large, national carriers as ‘moderately to extremely difficult.’ To make matters worse, one in three of those same rural wireless operators surveyed pay more to the national carriers for wholesale data roaming services than they themselves are paid for the same services. If this unacceptable practice is allowed to continue, rural consumers will be left with nothing but unaffordable options when it comes to wireless service—or worse yet: no options at all.”

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Headquartered in Washington, DC, the Rural Telecommunications Group, Inc. (RTG) is a trade association representing rural wireless carriers who each serve less than 100,000 subscribers. RTG’s members have joined together to speed delivery of new, efficient and innovative telecommunications technologies to remote and underserved communities. ruraltelecomgroup.org @RTGwireless

The National Telecommunications Cooperative Association is the premier association representing more than 580 locally owned and controlled telecommunications cooperatives and commercial companies throughout rural and small-town America. NTCA provides its members with legislative, regulatory and industry representation; meetings; publications and educational programs; and an array of employee benefit programs. Visit us at www.ntca.org.