For Immediate Release
September 19, 2000

Washington, D.C., – "It is extremely disappointing that Congress decided to move ahead with H.R. 4445 to eliminate the reciprocal compensation regime—which enables CLECs and incumbent monopolies to reimburse each other for the costs of terminating Internet dial-up access calls over their networks to Internet service providers (ISPs). Last night’s subcommittee markup, which resulted in a bill and keep regime that must be implemented over a 6 month transition period, is unnecessary and draconian. Due to the large number of amendments offered, it is clear that the time is not ripe for Congress to pass legislation on the issue, but to study the complexities and give serious thought to the consequences. Moreover, the amended legislation will still effectively create an increase in consumers’ Internet bills by as much as 35 percent. Competition, not legislation, is the catalyst that has been driving reciprocal compensation rates down—to as much as one tenth of one cent in some areas. This is the result of competitive forces pushing both CLECs and incumbent monopolies to reduce costs through technology improvements and the economies of scale. This legislation disregards these facts and permits the incumbent monopolies to circumvent their obligations under the 1996 Telecommunications Act."

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