Point of presence

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In 1984, the MFJ established a definite demarcation point between local services and “long distance” services, although it became much more proper to speak of intra-LATA and inter-LATA. A special case or category became known as intra-LATA toll calls. These were calls that originated and terminated within a single LATA, but were billed at a higher rate, called a toll. The whole concept is similar to the idea that a toll road is still just a road, but people are charged money to use it.

The MFJ structure thus left customers with essentially three basic types of telephone calls. Local calls were almost universally billed at flat rates regardless of connection time. Toll calls were in most cases billed by the local service provider, but carried by the long distance companies, since economies of scale and aggregation of traffic was important for these calls. So, many intra-LATA toll calls were actually handled by the interexchange carriers (IEC), but billed to customers transparently by the local exchange carriers (LEC). Finally, long distance calls (technically inter-LATA toll calls) were billed on a separate section of the bill and reflected a distance and time pricing structure in most cases.

The place where local service ended and long distance began was at the IEC’s point of presence (POP) within the LATA. This was the IEC’s switching office and obviously an IEC had to have a POP within a LATA to handle local traffic into and out of the LATA. Now, even if an IEC did not have a POP in a particular LATA, nothing prevented an IEC from handing the call off to a competing IEC, as long as the call was paid for. In this case, the billing IEC paid out a portion of the billed amount to the other IEC. This happened whenever an IEC with a POP in the originating LATA did not have a POP in the terminating LATA, which was more frequent than people realized. In fact, as recently as 1995, only AT&T (naturally) had a POP in every LATA in the United States. (Alaska was most often not covered.)

Anyway, under the MFJ, all local subscribers had to have “equal access” to any and all IECs maintaining POPs in the LATA. Often this meant dialing a prefix to the area code and number, but IEC preferences could be presubscribed. Therefore, by expressing a preference for MCI (for example), unless special dialing rules were followed, all “normal” calls outside the LATA were carried by and billed by MCI. There were several categories of special dialing rules to override the presubscription arrangements. These were known as Feature Groups and depended heavily on the LEC’s switching office software. The ultimate Feature Group, Feature Group D, allowed dialing a simple “10288” prefix to reach AT&T (for example). The “288” was AT&T’s Carrier Identification Code (CIC), which was dialed as A-T-T.

Unauthorized transfer of presubscription from one IEC to another was common and annoying to users. This technique became known as slamming and came under the scrutiny of the FCC, but continues nonetheless, even today. Of course, the IEC had to pay access charges for the local portions of these inter-LATA toll calls. These were paid to the LECs at each end. With the introduction of voice over IP (VoIP) these access charges have been the center of debate. Internet Telephony Service Providers not being required to pay them. The reason they are exempt is to help foster the internet. However, this debate has lead to question whether access charges for any carrier should be eliminated altogether.