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 NEWS  Federal  Communications  Commission  445  12  th  Street,  S.  W.  Washington,  D.  C.  20554  This  is  an  unofficial  announcement  of  Commission  action.  Release  of  the  full  text  of  a  Commission  order  constitutes  official  action.  See  MCI  v.  FCC.  515  F  2d  385  (D.  C.  Circ  1974).  News  Media  Information  202  /  418-  0500  Internet:  http://  www.  fcc.  gov  TTY:  1-  888-  835-  5322 
 FOR  IMMEDIATE  RELEASE:  NEWS  MEDIA  CONTACT:  February  10,  2005  Mark  Wigfield,  202-  418-  0253 
 Email:  mark.  wigfield@  fcc.  gov 


 FCC  REDUCES  THE  COST  OF  SWITCHING  LONG-  DISTANCE  PROVIDERS 
 Rate  Could  Drop  from  $5  to  $1.25 
 Washington,  D.  C.  –  The  Federal  Communications  Commission  today  moved  to  reduce  the  cost  to  consumers  of  switching  long-  distance  providers. 


 The  current  rate  of  $5  could  be  reduced  to  $1.25  under  the  Commission’s  new  rules.  These  rates  would  apply  when  long-  distance  carriers  order  the  changes  electronically  rather  than 
 manually.  For  manual  changes,  the  rates  could  increase  slightly,  to  $5.50. 
 Local  exchange  carriers,  which  receive  the  fees  for  switching  a  customer’s  pre-  subscribed  long-  distance  carrier,  can  charge  more  if  they  can  document  higher  costs.  However,  local 


 carriers  that  adopt  the  new  “safe  harbor”  rates  are  free  from  the  expense  of  submitting  detailed  cost  information.  Local  companies  can  also  charge  less  than  the  safe  harbor  rate  if  they  choose. 


 When  consumers  switch  both  interstate  and  intrastate  long-  distance  providers  at  the  same  time,  the  charge  for  changing  the  interstate  provider  is  cut  in  half,  from  $1.25  to  63  cents  for 
 electronically  processed  changes.  The  FCC  has  no  authority  to  reduce  the  intrastate  charge,  which  is  set  by  each  state. 


 The  Commission  found  that  electronic  processing  and  other  changes  in  the  industry  have  reduced  the  cost  of  switching  carriers  since  the  $5  fee  was  adopted  in  1984.  The  order  creates  an 
 incentive  for  long-  distance  carriers  to  invest  in  electronic  processing  so  that  fees  charged  by  local  providers  won’t  deter  customers  from  signing  up.  Long-  distance  companies  sometimes 
 voluntarily  pay  these  fees  to  attract  new  customers,  but  they  are  not  required  to  do  so. 
 Local  carriers  that  haven’t  installed  systems  capable  of  processing  electronic  orders  would  not  be  required  to  do  so  if  the  investment  isn’t  economically  rational.  These  carriers  may 


 charge  the  safe  harbor  rate  for  manual  changes. 


 Action  by  the  Commission  February  10,  2005,  by  Report  and  Order  (FCC  05-  32).  Chairman  Powell,  Commissioners  Abernathy  and  Martin,  with  Commissioner  Copps  approving 
 and  dissenting  in  part  and  Commissioner  Adelstein  concurring.  Separate  issue  by  Chairman  Powell,  Commissioners  Copps  and  Adelstein. 
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 Wireline  Competition  Bureau  Staff  Contact:  Jennifer  McKee,  202-  418-  1590;  jennifer.  mckee@  fcc.  gov 
 -FCC- 
 News  about  the  Federal  Communications  Commission  can  also  be  found 
 on  the  Commission’s  web  site  www.  fcc.  gov. 
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