Wednesday, October 24, 2007

Reduced Rate Wireless Lifeline Service Now Available in New York

Nextel Advertises Lifeline Rates
PULP has noticed that for the first time Nextel has begun advertising a Lifeline and Link-Up service in the Capital Region. While the company received its authorization to offer Link-Up/Lifeline in New York from the FCC in August 2004 (as part of its designation as an Eligible Telecommunications Carrier, or ETC, in several states, including Alabama, Florida, Georgia, Pennsylvania, Tennessee, and Virginia), the only surprise is the lag time.

According to the Nextel website, eligible Lifeline customers in New York can save up to $13.50 per month off of a $29.99 service plan. Those who live on Tribal Lands may only need to pay $1.75 per month for the same service.

Four Wireless Providers in New York Must Offer a Lifeline Rate for Low Income Consumers
Nextel is not alone. In fact, American Cellular, Dobson Cellular (soon to be part of AT&T), Nextel Partners, and Sprint PCS have all received their ETC status in New York. Nextel appears to be the first of the group to actually advertise its Lifeline service in New York.

In order to receive its ETC designation, Nextel and the other companies demonstrated to the FCC:

(1) That the FCC had authority to consider its petitions because the state commissions claimed that they lacked jurisdiction. In fact, a letter was sent by the PSC general counsel’s office to the FCC stating that New York lacks jurisdiction over the Nextel petition. Nextel Lifeline PSC Letter.

(2) That it offers, or will offer upon designation as an ETC, the services supported by the federal universal service mechanism. Nextel also certified that, in compliance with the FCC’s Rules, it will make available and advertise Lifeline and Link-Up services to qualifying low-income consumers. Three years later, the advertising has begun, but Nextel had pledged that it was ready to offer these services in 2004.

Consumer Protections
Nextel also promised the FCC that it would follow the CTIA Consumer Code and the commitments laid out in the FCC’s Virginia Cellular Order, including:

(a) annual reporting of progress towards build-out plans, unfulfilled service requests, and complaints per 1,000 handsets;
(b) specific commitments to provide service to requesting customers in the area for which it is designated, including those areas outside existing network coverage; and
(c) specific commitments to construct new cell sites in areas outside its network coverage.

The CTIA Code is not an adequate substitute for the Telephone Fair Practices Act (“TFPA”) consumer protections expected by telephone consumers. See PULP Testimony to NYS Assembly.

Nextel went on to pledge to the FCC: (1) that it offers and will continue to implement E-911 access; (2) that it will comply with any minimum usage requirements required by applicable law (Nextel also stated that local usage is included in all of its calling plans); (3) that it will provide access to interexchange services, and is not required to offer equal access to those services; (4) that it offers the supported services using either its own facilities or a combination of its own facilities and resale of another carrier’s services (Nextel stated that it intends to provide the supported services using its existing network infrastructure); and (5) that it is committed to specific methods to advertise the availability of the supported services and the charges for the services using media of general distribution.

Limited Services Available With Wireless Lifeline
So, what does reduced rate wireless Lifeline service include in addition to savings of $13.50 per month? On Nextel’s Lifeline application form, it states that the Lifeline service itself includes 200 anytime minutes and unlimited night and weekend minutes, which may be used for local or long-distance calls. Lifeline service also includes Voice Mail, Call Waiting, Caller ID, Numeric Paging, Roaming, and Three-Way Calling at no additional charge. Lifeline subscribers may also purchase a reduced-cost Lifeline phone. Nextel Lifeline Application

There are some limitations, however. The application also states that Lifeline service is available in limited (but, unidentified) geographic areas and is only available for one wireline or wireless phone line per household. In addition, data services and other enhanced services or features, international long distance, and access to “900” numbers are not available to Lifeline subscribers. Another limitation is that Lifeline service plan minutes are only available for calls within Sprint Nextel coverage areas

Further, some customers may be charged a service deposit based on the applicant’s credit history. The service deposit may be avoided, however, by choosing an account spending limit (“ASL”) of $75 or less.

Access to emergency services by dialing 911 is not subject to any account usage limitation. The Nextel website failed to mention that wireless E-911 is not available in all geographic areas.

As for Link-Up, Nextel will pay one-half of the $36 service activation fee. Eligible residents of Tribal lands may receive an additional credit of up to $70 to cover 100% of the service activation or installation charges. Applicants may also receive a deferred schedule (of up to one year) for payment of the discounted charges for commencing service.

Open Questions
Will wireless Lifeline increase Lifeline enrollment, which has fallen in recent years? Will landline Lifeline customers switch to take advantage of the mobility benefits or will they reject wireless Lifeline due to the E-911 or service availability gaps? Will the New York PSC or the State Legislature extend state TFPA telephone consumer protections to users of wireless phones now that they are becoming substitutes for conventional landline service? Stay tuned.

-- Lou Manuta
Staff Attorney

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