Very Computer

When I got my basic service installed here in Palo Alto, CA, the guy on the
other end asked if I wanted the touch-tone "option".  I asked him what the
additional cost was, and took it.  Then I gave him the old "Did you know..."
about how when the phone-using public was paying for the research that led to
touch-tone, it was told (correctly) that touch-tone would bring down the cost
of running the phone system and (incorrectly) that the savings would trickle
down to the consumers.

He was surprisingly knowledgeable for a sales rep, and we had a nice
conversation about the current state of digital systems implementation and
arbitrary restrictions on ISDN services.  He also said that "PacBell is
lobbying (some regulating body (the PUC?)) to kill the extra charge for
touch-tone".

PacBell is a business.  It wouldn't try to kill the touch-tone charge unless
(a) they believe that the cost of supporting pulse dialing will soon exceed the
revenue of touch-tone charges, or (b) they have been overcome by an irrational
urge to charge for a service proportionally to its cost.  If PacBell is
anything like other BOCs I've done business with, I find (b) to be exceedingly
unlikely.  Anyone have any evidence suggesting (a)?  Any other reasons PacBell
would be lobbying for such a move?  Any evidence that the sales rep was
mistaken (i.e. that PacBell is making no such lobbying effort)?

I have always felt that tone "service" charges were one of the most irrational
BOC charges.  There is no extra cost to the BOC, and in some cases it results
in *lower* operating costs.  I am very interested to learn if there is any
truth to the rumor that the charge may be removed.

--
Be seeing you...
--Lang Zerner

"...and every morning we had to go and* the road clean with our TONGUES!"

One possible reason for eliminating touch-tone charges would be if you
believe they act as a barrier to selling more of other kinds of services.
Remember the elementary economics concept of elasticity of demand.

Quote:(Lang Zerner) writes:
> I have always felt that tone "service" charges were one of the most
> irrational BOC charges.  There is no extra cost to the BOC, and in some
> cases it results in *lower* operating costs.  I am very interested to learn
> if there is any truth to the rumor that the charge may be removed.

Absolutely NO chance that the charge may be removed.  What they will do
is simply add the same charge to pulse-dialed lines, and tell you that
they have removed the surcharge. [ 1/2 :-) ]

--

gatech!nanovx!msa3b!kevin

Quote:(Lang Zerner) writes:
> He also said that "PacBell is lobbying (some regulating body (the PUC?)) to
> kill the extra charge for touch-tone".
> PacBell is a business.  It wouldn't try to kill the touch-tone charge unless
> (a) they believe that the cost of supporting pulse dialing will soon exceed
> the revenue of touch-tone charges, or (b) they have been overcome by an
> irrational urge to charge for a service proportionally to its cost.

The answer is (c), it is part of a package of general deregulation that
Pac*Bell is trying to get past the PUC and getting flack on all sides
for doing so. Pac*Bell would like to be able to set its pricing in the
competitive business market without the giant hand of the PUC getting
in the way. As part of the inducement, they have promised a freeze in
residential rates through 1991 (or 92, I can't remember and someone
threw out the newspaper), elimination of the touch-tone charge and
other goodies.

The opposition, in the persona of other telecom services and consumer
groups are vehemantly opposed. The other service providers are afraid
that Pac*Bell will have great unfair advantage in a non-regulated
environment with its control of the local wire plant. Consumer groups
feel that residential service should come down, not be frozen at the
current level.

IMHO, the business may have a point, but it's hard to get behind the
consumer groups. They are steadfastly against the plant upgrading that
Pac*Bell is proposing, saying that it is too costly and that rate
payers shouldn't be stuck with it. Most of the consumer advocates that
I have spoken with, however, seem to feel that adequate telephone
service consists of a black rotary-dial wall phone in the kitchen and
the fact that there is a hell of a lot of electro-mechanical equipment
that needs replacing is of no concern to them.

I haven't made up my mind about their proposal, yet. On the one hand,
it seems logical and reasonable. And I certainly wouldn't mind some
plant upgrading. On the other, I tend to distrust any proposal by the
utility because I know whose interests they are really trying to
serve.
--
        John Higdon         |   P. O. Box 7648   |   +1 408 723 1395

As far as dropping charges for tone service goes, here in Washington (State)
Pacific Northwest Bell dropped them about a year ago.  (It had been 50 cents
monthly.)  All the various packages also dropped by 50 cents.  Apparently,
any "discount" for the packages was kept without change.  Of course, we all
know that these features are essentially free to the telco anway, but...

Sam Ho