PacBell, GTE Told to Reduce Portability Fee

Federal regulators on Friday ordered Pacific Bell and GTE to reduce the monthly fees they charge customers to help pay for the ability for callers to keep the same phone number when they switch carriers.

PacBell and GTE, which serve the majority of Californians, began charging the fee in February. It is listed on residential and business phone bills as a “local number portability” charge.

The fee is allowed--but not required--by federal regulators to reimburse local phone companies for the cost of equipping their networks to make phone numbers portable. With number portability, a customer can change phone companies without having to adopt a new phone number--an ability considered key to promoting local phone competition.

The amount of the fee varies by carrier and depends on the customer’s type and number of phone lines. PacBell charges 50 cents per month, per line, while GTE’s fee is 43 cents. Certain business lines might have higher fees.

Under a ruling released Friday by the Federal Communications Commission, PacBell must reduce its fee by a third, to 34 cents. GTE must drop its portability fee by 16%, to 36 cents per month.

PacBell said it will begin charging the lower fee Wednesday, and GTE pledged to comply with the order quickly. The companies also will issue credits or refunds to customers for five months of overpayment--amounting to 80 cents per line for most PacBell customers and 35 cents for most customers of GTE.

Under the federal rules, local phone companies can charge the local number portability fee for no more than five years. In addition, they are prohibited from charging subsidized “lifeline” customers the fee and from assessing the charge in areas where number portability is not yet available.

When the fee was introduced, many residential customers complained that they are footing the bill for number portability and competition, but have no choice for local phone service.

The FCC’s order to lower the fees came after a five-month review of the expenses both companies submitted for reimbursement under the local number portability plan.

FCC officials cut PacBell’s total bill by 43%, to $428 million, and reduced GTE’s total bill by 6% to $459 million. The regulators also ordered fee reductions for customers of Ameritech and Southwestern Bell, a sister company to PacBell.