On this page, I show the various charges currently being charged by the phone company.  Take special note of the non basic charges and per call charges.  Many of these charges are unregulated and bear no relationship to cost.  The motto of the phone company must be "whatever the traffic will bear" or the "sky is the limit".  This, of course, will continue as long as the phone company writes legislation and remains the dominant carrier in Michigan. 

For some of the unusual charges, I have included a brief explanation.  Also, in spite of the description, I show that most of the money goes to the local phone company. 

I breakdown the following information into basic rates and special services.  Although there are 8 rate groups in the Metropolitan Detroit area, the charges do not vary significantly between groups.  Therefore, I use my bill information in the following analysis. I have two lines, one is used primarily for my computer.

I should point out that the 911 charges are specific to Oakland County and will vary by community.  

In spite of the description of Federal and State access charge, this money all goes to the phone company.  I believe the 911 emergency charge goes to the phone company but is used to support the county 911 emergency system.  The Federal Access Charge is a charge allowed by the Federal government.  The purpose is to allow the phone company and all phone companies to collect a fee directly from the customer and thus lower the charge to the long distance company for accessing the local phone system for initiating and completing long distance calls.  This theoretically allows the long distance company to keep its rates down.  Of course, if you don't make any long distance calls, you pay to keep rates low for someone else.

While the basic charge does not appear to be outlandish, keep in mind that the local calling area is very limited.  You will be charged extra for zone and "local toll" (itemized) calls.  Here are the rates:

The phone company does have plans available that result in reduced per minute charges but include a fixed charge.  I suggest you price out alternate carriers unless you want to continue to pay these high prices.  You have seen the ads, you can call across the country for under 10¢ a minute so why should you pay 14¢ to 25¢ a minute to place a call within the Metropolitan Detroit area that the phone company categorizes as "local toll".  Then again, why should you pay a zone charge for a call that may be to your neighbor across the street or a call that may be within 20 miles of your home.  

My long distance company charges me an access fee or a
PIC C charge.  What's that and where does this money go?

The PIC C charge was eliminated effective July 1, 2000.  Thus the phone company should no longer be charging the LD company this fee.  However, some long distance companies may still include this fee on their bill.  If your LD Company still charges for a PIC C, this is just additional revenue for the LD company with no associated cost.  

Following are some the rates for optional services:  I recommend you closely evaluate each service to see if it is necessary.  Cancel those that are not essential. 

As you can see the costs of these add on services are high.  These charges are unregulated and as the phone company is the near monopoly or at least the dominant carrier, the sky is the limit.  As the phone company has undoubtedly recovered the cost of software necessary to provide these services (not including the cost of operator assisted calls) many times over, the profit margin on these services is enormous. 

If nothing else, hopefully you will realize the high cost of these services and eliminate non essential services and be cautious in the use of any operator assisted calls.

What's the State Access Charge?

The State Access Charge is a charge that has been on your bill for a period of time.   It theoretically allows the phone company to recover costs similar to the Federal Access Charge directly from the customer, for long distance calls within the state, instead of from the long distance carriers.  It generates millions of dollars in revenues for the phone company.  Other states don't have this charge.  It was allowed under a provision for in the Michigan Telecommunications Act of 1995.  See my page entitled MTA of 1995.  If you don't make any long distance calls within the state, you still pay this charge.  And, of course, if the phone company didn't reduce its access charges to the long distance companies, or if they did and the long distance companies didn't reduce their rates, it's just an additional expense to you. 

This charge was wisely eliminated as part of the Telecommunications Act of 2000.  Then Ameritech and GTE (now Verizon) and perhaps others went to Court.  The Court unwisely has allowed the continuation of this charge until the matter is adjudicated.