MCI Goes to Court to Challenge FCC Ruling on Internet Access

MCI WorldCom has filed a legal challenge to an FCC ruling that says calls made to connect to Internet service providers are the equivalent of long-distance calls. MCI’s appeal, filed with the federal appeals court in Washington, is expected to prompt other major telecommunications company to follow suit.

The telecom giant is arguing that the Federal Communications Commission’s decision was “arbitrary and capricious.” The FCC promised the ruling wouldn’t result in long-distance-style fees for Internet users, but it will shift the fees that pass between local phone companies on Internet calls, known as “reciprocal compensation.”

While the FCC ruling is debated in court, local phone companies are rushing to cash in. Bell Atlantic recently filed a petition with regulators in Massachusetts seeking relief from paying rival companies the “reciprocal compensation” in question. In addition, the company has begun placing the fees in escrow instead of paying them to other phone companies.

Stay tuned, because the regulatory wrangling could ultimately affect Internet users. Consumer groups warn that even if the FCC can protect users from per-minute long-distance charges, they may ultimately see the new fees passed on to them in higher ISP prices.