Coronavirus Increases Use of Conferencing Services Leading to Company-Specific Access Stimulation Rule Waiver

On Friday, March 27, 2020, the Federal Communications Commission’s Wireline Competition Bureau (“Bureau”) granted Onvoy d/b/a Inteliquent a temporary and limited waiver of the Commission’s rules that treats competitive local exchange carriers with an interstate terminating-to-originating traffic ratio of at least 6:1 as engaging in access stimulation. The Bureau found that the extraordinary circumstances accompanying the current COVID-19-related public health crisis leading to increased conferencing traffic warranted a company specific waiver, which temporarily exempts Inteliquent from the requirement, if it exceeds the 6:1 ratio due to traffic from its existing customers (as of March 17, the date of Inteliquent’s petition for waiver), of assuming the financial responsibility for any applicable intermediate access provider’s terminating charges for any traffic between a local exchange carrier’s terminating end office or equivalent and the associated access tandem switch. However the Bureau stresses that the waiver was limited to Inteliquent and expressly rejected a request that the waiver extend to all conferencing traffic.

The waiver petition and its grant were both prompted by what the Bureau described as the massive shift to telework and distance learning” that has materially altered Inteliquent’s normal mix of originating and terminating traffic” as the response to COVID-19 has set in. Inteliquent’s conferencing customers include Zoom and Cisco WebEx. The grant is limited to Inteliquent assuming the facially plausible” facts the company presented are accurate. Inteliquent, the Bureau emphasized, before its Petition, had traffic ratios that did not qualify it as an access-stimulating local exchange carrier.

The Bureau granted the waiver only through June 1, 2020, but noted that Inteliquent would be eligible for renewal for further periods as long as the public health crisis persists and Inteliquent’s circumstances remain fundamentally the same. Notably, the Bureau took the unusual step of inviting interested parties to seek reconsideration of the grant if they believed the facts Inteliquent presented in its petition were inaccurate or the Bureau’s policy reasoning” was flawed.

Another point to note was that the waiver was limited to the treatment of the traffic of entities that were Inteliquent customers as of March 17, 2020, the date of its petition, meaning that only such traffic would be excluded from calculations of the Inteliquent terminating-originating traffic ratio.

The Bureau was wary about making the waiver a general one, finding that there is no reason to believe that all local exchange carriers that provide service to conference calling platforms are similarly situated to Inteliquent” and citing concerns that a general waiver would create an opportunity for existing access-stimulating local exchange carriers to continue the schemes the Commission sought to disrupt by adopting the [September 2019] Access Arbitrage Order.”

While the grant is Inteliquent-specific and despite the Bureau’s refraining from making the waiver grant a general one, the order leaves room for other waiver requests by other entities in the present circumstances provided they have a good story to tell linking their surge in terminating traffic putting them in danger of exceeding the threshold 6:1 ratio to the current public health crisis. Indeed, when adopting the current access stimulation definition, the Commission left open the potential for waivers. However, the Bureau signaled that carriers that already exceeded the ratio would face a very high and even insurmountable hurdle.

Since Inteliquent filed its petition for waiver, two other entities, Peerless Network, Inc., and Native American Telecom – Pine Ridge, LLC, have sought waivers. Both note that, prior to the current health crisis, they were not within the scope of the access stimulation definition. Both petitions remain pending.