Here's To You, Mr. Traffic-Pumper, Access-Stimulator Telecom Guy!
With apologies to Bud Light, and their fabulous "Real Men of Genius" radio ads, TeleComSense will, on occasion, try to honor those innovators in the communications industry, which devote so much ingenuity and effort to produce little-to-negative consumer welfare. If you're not familiar with the Bud Light ads, they are, quite simply, the best radio ads, period--just click on the link above, and get ready for tons of simple-minded, yet clever (in a simple-minded kind of way) entertainment. The format is always the same: a guy with a deep, booming voice offers a tongue-in-cheek "salute" to the frequently inexplicable, generally trivial, and always humorous, occupations, products, hobbies, or other segments of our "market-driven" society, while a cheesy '80s sound chorus will chime in with additional fanfare. [Warning: if the "market" is your "religion", you might find these commercials quite blasphemous].
Unfortunately, the Bud Light crew beat me to one communications industry example--"Mr. Dishonest Cable TV Hooker Upper", but here are the "lyrics" to this tribute. The words in parentheses contain the singing parts.
Bud Light Presents Real Men of Genius
(Real Men of Genius)
Today, we salute you, Mr. Dishonest Cable TV Hooker Upper
(Mr. Dishonest Cable TV Hooker Upper)
On any given day, sometime between nine and four thirty,
you arrive ready to bring us the world and,.
for an extra twenty, you will bring us porn.
(naughty, naughty boy)
Hey, you've already got the van and the jumpsuit,
why not get into criminal activity?
(Just a naughty boy)
Afterall, what are they gonna do, throw you in cable jail?
( I don't think so)
So, crack open an ice cold budlight, Manhandler of the scrambler,
because isn't it about time someone hooked you up?
(Mr. Dishonest Cable TV Hooker Upper)
OK, here's a little background on our first TeleComSense "Real Industry Innovator"--the much-maligned "traffic pumper." A "traffic pumper", or "access stimulator" is a LEC that finds a way to maximize the amount of traffic (minutes) that it can terminate at the highest switched access terminating rates (usually the rates allowed in the most rural areas). But here's the trick, the "traffic pumper" does it without ever completing one additional call to a human in that service area. While "access charges" existed, in one form or another, prior to the AT&T divestiture in 1984, it should be noted that access charges became much more visible at the time of the AT&T divestiture, and were designed to enable long distance competition while continuing to compensate the newly-divested Bell Operating Companies and independent telephone companies for long distance calls made over their local networks. In effect, access charges provided a way to maintain the longstanding cross-subsidization of "basic local exchange service," by "long distance service" in a market with multiple long distance providers.
These rates were traditionally higher in rural territories (with less subscribers) because, although, there is virtually no incremental cost for any carrier to terminate any call, the Commission recognized that carriers with a low volume of calls will have less terminated minutes over which to recover the fixed cost of a switch than urban carriers, which would naturally terminate a higher volume of minutes. It is important to note that these regulated rates are based on the days when a "switch" meant a "big iron" $1 million plus, Lucent 5ESS--that was the state of the art when these rates were last set. These switches had a high fixed cost; today's modern IP-based switches are much cheaper and, more scalable, than the older "one size fits all" 5ESS switch.
However, because traffic is considered "terminated" when it reaches its "platform" destination, the "traffic pumper" is able to locate equipment (or pay others to set up inbound audio-conferencing bridges), designed to automatically redirect large volumes of calls through rural areas without ever really serving any local customers over "true" access lines to the area. In other words, because of the legacy intercarrier compensation scheme--with its regulated rates, based on location--the traffic pumper can take advantage of the Commission's rules that "he who chooses (the caller "chooses" the terminating carrier by calling a certain number) doesn't pay (rather, the caller's carrier pays), and he who pays (the caller's carrier) does not choose the carrier through which it can terminate calls. Thus, the traffic pumper's costs are less than any other carrier (no nettlesome high-cost/high maintenance long loops), but it has call volumes closer to those of an urban carrier, yet it charges rates that reflect the rates charged by the highest cost carriers! Lowest costs, highest prices and a captive customer base sounds like a recipe for success, huh?
It is notable that a traffic pumper is most frequently a "competitive" LEC ("CLEC"), because they are less regulated than incumbent LECs--that is affiliated with a rural LEC. These CLECs earn their distinction over "real" CLECs, like a Cavalier Telephone, a DeltaCom, or Cbeyond, in that the "real" CLECs make almost all of their revenue from selling retail communications services to end-users (residential or business), or by selling wholesale telecommunications service to other carriers or ISPs. The business of a "real" carrier (ILEC or CLEC) is downright pedestrian. Customer buys service, service provider supplies service, and out-bound minutes are roughly equal to in-bound minutes; so, assuming a reciprocal price for terminations, little if any money actually changes hands. Wake me up, already.
The "traffic pumper", on the other hand, proudly exploits all of the regulatory opportunities available to it . . . much like their contemporary cousins, the really inefficient high-cost carriers that take the most money (per line) from the Universal Service Fund. [Hint, these could be the next TeleComSense Real Industry Innovators] [In fact, some of the pumpers do both - bill carriers for access charges and the government for USF!] In a nutshell, the most admirable quality of the traffic pumper is that, like the early native Americans, they use all of the telecom laws--and sometimes even more. No waste, but no worries because the FCC almost always makes it right in the end. Why? Because, with apologies to Eminem, only the FCC can say, "we're the ones that made you." So, without further delay, we salute you, Mr. Traffic-Pumper, Access-Stimulator Guy!
TeleComSense Presents Real Industry Innovators
(Real Industry Innovators)
Today, we salute you, Mr. Traffic-Pumper, Access-Stimulator Telecom Guy!
(Mr. Traffic-Pumper, Access Stimulator Guy)
The population of your entire service territory could fit
into just two Greyhound buses.
(That's not much traffic.)
Yet, with the equipment you could store in just one luggage compartment of one bus, you could terminate all the calls to the New York Stock Exchange in one year
. . . all without serving one additional human in your service territory.
(Busy, busy, brokers . . . now we're cookin')
They say some guys have a license to steal, but you got yours
from the Federal Communications Commission under
Section 214 of the Communications Act!
(Take that Howard Stern!)
So, crack open a cold Bud Light, Mr. Orchestrator of the Arbitrage, and
enjoy the minute-upon-minute, thousands of times a minute, cascade of the Cold Hard Cash, you earned it, and even if you didn't . . . it's the law!
(Mr. Traffic-Pumper, Access-Stimulatory Telecom Guy)