FCC RURAL CALL COMPLETION ORDER & OTHER ISSUES Stan Redden – Vice President Software Development

Rural carriers have long been experiencing the following issues with long distance calls terminated to their customers: Poor call quality Lengthy dead air period on the callers phone after dialing – they hear nothing False busy signals Inaccurate intercept messages such as The number you have dialed is not in service or Your call cannot be completed as dialed FCC RURAL CALL COMPLETION 2www.cdg.ws

No audible voice on one end of the call, or both, even after connecting Audible ringing on the callers phone but no actual ringing on the called partys end Caller hears 15 to 20 rings on their end, but called party only hears 2 or 3 before answering FCC RURAL CALL COMPLETION 3www.cdg.ws

One of every five long distance calls placed to rural locations are experiencing these issues which result in the following: Causes rural businesses to lose customers Cuts families off from their relatives in rural areas Creates potential for dangerous delays in public safety communications in rural areas Culprit seems to be related to the use of intermediate providers to carry these calls, most notably Least Cost Routers FCC RURAL CALL COMPLETION 4www.cdg.ws

After on-going complaints by the rural community and several different telecom agencies demanding action on this issue, the FCC finally release a NRPM (Docket ) to address this issue FCC RURAL CALL COMPLETION 5www.cdg.ws

Order outlines the following requirements: All service providers (wireline, wireless, and VoIP) who have over 100K domestic customers and who use a intermediate carrier to provide long distance service must comply with the data request Must retain all long distance call detail records placed for a period of 6 months Must file a call completion ratio report with the FCC on a quarterly basis Those failing to comply with the order may be subject to fines and possibly other enforcement actions by the FCC FCC RURAL CALL COMPLETION 6www.cdg.ws

FCC Reporting Template: FCC RURAL CALL COMPLETION 7www.cdg.ws

Report breaks out outbound long distance calls into the following categories: By State By Rural OCN By Interstate, Intrastate, and Total Total Calls Attempted Total Calls Answered Total Calls Busy Total Calls Ring No Answer Total Calls Unassigned Number Percentage of calls Answered and Completed FCC RURAL CALL COMPLETION 8www.cdg.ws

Order is currently in the comment cycle Industry waiting on the FCC to make final ruling on order details and set implementation date FCC RURAL CALL COMPLETION 9www.cdg.ws

Depending upon final FCC Order, modifications to your switch may be made AMA Module 130 contains the fields Facility Release Cause and Call Characteristic Facility Release Cause field contains the information to identify specific types of termination cause (one of the items on the current FCC Reporting Template) Call Characteristic field contains characteristics of the call (least cost routing, Intelligent Network Reject, etc.) AMA Module 051 contains similar information but is related to Operator Services FCC RURAL CALL COMPLETION 10www.cdg.ws

CDG, Teletech, and DataTech have joined forces to develop a new process to address this issue The result is a new option to the CDG Mediation system that has the ability to process and store the necessary CDRs and to produce the quarterly report as required by the FCC Process will utilize TeleTechs Localizer database to discern long distance calls from local FCC RURAL CALL COMPLETION 11www.cdg.ws

Process will also support a QRT function to support deeper dives into the data DataTechs analytical and regulatory expertise will be available to further analyze the data and assist customers in addressing any reporting issues Please contact Jon Jones of DataTech, Kim Russo of TeleTech, or your CDG representative for further information on this solution! FCC RURAL CALL COMPLETION 12www.cdg.ws

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Transition to Bill & Keep regime continues on path for terminating switched access charges and reciprocal compensation Rate of Return Companies: Step 1: July 1, 2012 – reduce rates to 50% of interstate Step 2: July 1, 2013 – reduce rates to interstate parity Step 3: July 1, 2014 – reduce rates by 1/3 of the difference between interstate and $0.005 Step 4: July 1, 2015 – reduce rates by 1/3 of the difference between interstate and $0.005 FCC USF/ICC REFORM UPDATE 14www.cdg.ws

Step 5: July 1, 2016 – reduce rates to $0.005 Step 6: July 1, 2017 – reduce rates by 1/3 difference between $0.005 and $ Step 7: July 1, 2018 – reduce rates by 2/3 difference between $0.005 and $ Step 8: July 1, 2019 – reduce rates to $ Step 9: July 1, 2020 – Bill and Keep FCC USF/ICC REFORM UPDATE 15www.cdg.ws

Price Cap Companies: Step 1: July 1, 2012 – reduce rates to 50% of interstate Step 2: July 1, 2013 – reduce rates to interstate parity Step 3: July 1, 2014 – reduce rates by 1/3 of the difference between interstate and $ Step 4: July 1, 2015 – reduce rates by 1/3 of the difference between interstate and $ Step 5: July 1, 2016 – reduce rates to $ Step 6: July 1, 2017 – Bill and Keep FCC USF/ICC REFORM UPDATE 16www.cdg.ws

Effective July 1, 2014, originating VoIP usage will be subject to the same rating rules as interstate VoIP FCC still has not addressed any reforms concerning originating traffic Industry still awaiting the 10 th U.S. Circuit Court of Appeals decision on the USF/ICC Transformation Order case where oral arguments were held in November, 2013 Most experts do not expect a decision to be rendered until mid to late 2014 FCC USF/ICC REFORM UPDATE 17www.cdg.ws

Numerous critical issues that are awaiting FCC decision: Reform of Special Access Net Neutrality IP Transition Others??? Douglas Meredith of JSI will be addressing these issues and others during our general session today at 1:30pm in the Alma Mater room FCC USF/ICC REFORM UPDATE 18www.cdg.ws

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