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HOW TO SELECT A LONG DISTANCE CARRIER
By: George L. Cofran, President
Cofran & Associates, Inc. Rev 5/1/95
Clients often ask us to assist them in understanding the differences between long distance carriers and their products, and then to help them make an informed selection. We recommend using the following criteria, in terms of key questions to ask the carrier and to verify, for evaluating the typical "one-plus" based outbound calling application for a small to medium size business.
NETWORK LINE QUALITY:
Full "toll" quality audio fidelity on 99% of calls? No clipping, static, noise, volume changes, or low volume on the line? Assess this from both directions on each call. Make test calls even before you sign up. Ask the party on the other end how they evaluate the line quality.
If your not satisfied with line quality, no need to go further. With the increasing use of leased fiber optic circuits, there is less difference among carriers today.
NETWORK ACCESS:
Special equipment (dialers) required to reach the carrier? Who pays and maintains?
Speed of call set-up and connection?
Ease of dialing? Extra digits required?
Can you reach "LATA" destinations with this carrier? Special dialing required?
NETWORK RELIABILITY:
Frequency and duration of switch and network downtime? Will they show you records to prove their performance history? Will they provide dollar credits if boasted up-time is not met?
Frequency of calls not going through (i.e., not connected)? This should be almost never, in today's age of technology and service delivery. Gauge this by checking references.
CUSTOMER SERVICE:
Will they perform detailed competitive analysis from copies of your present bills?
Do they have knowledgeable, helpful representatives available to you? Will they visit you at your office and get down to details, or is it telemarketing only?
Toll-free 800 access available from out of town for questions or problems?
CALL PRICING:
Highly competitive per minute rates? Watch out for "flashcard" rates that don't take into account the following additional factors which drive up your NET EFFECTIVE COST PER MINUTE.
Minimum duration per call? (typical now is 6 seconds)
Billing increment length? (typical rounding now is 6 seconds, and this can be a significant cost factor)
Watch out for per minute rates quoted with a fractional cent (like 17.6 cents) which become rounded up to the next higher cent when billed (i.e., the actual call is always shown on the invoice rounded to at least an even penny: $.18). This is a different factor than the "billing increment" or "rounding increment" identified above.
Minimum usage per month? (any penalty?)
Monthly account fee?
Account/project code charges?
Any hidden one-time or recurring charges? Any "nickel and dime" charges after conversion?
Who pays for conversion of equal access carrier designation with your local phone company? Do you have to prompt the carrier or do they do credit you automatically?
Have they identified specific rates for calling within your home state? In some home states these are higher priced than out-of-state calls.
Have they identified rates for international calling? And for Alaska, Hawaii and Puerto Rico/Virgin Is. destinations?
Do they have access to "LATA" destinations and at what rates?
Have they identified rates for directory assistance calling? (most charge a flat rate per call, regardless of duration)
Many of these special calling categories can be VERY high margin "gotch ya's" that drive up your NET EFFECTIVE COST PER MINUTE.
Have they identified time-of-day (day, evening, night/week-end) discounts?
Have they identified volume discounts? (based on total dollars or hours; and do discounts apply retroactively to the first usage dollar of the month?)
Is there a minimum contract term? Few require any commitment on your part. Don't obligate yourself unnecessarily.
MONTHLY BILLING AND ACCURACY:
Timely delivery of invoice to you?
Invoice calls in accordance with proposed rates and terms? Billing only for actual call duration? And only your calls?
Billing only of calls made in the current usage period (i.e., no or few "catch-up" calls from prior usage periods)?
What are their late payment charges and terms?
USAGE REPORTING:
Detail provided for all LD calls? By line source?
Readability of invoice and summaries?
Summaries by traffic source (line number), type and destination (e.g., area code, state, country, etc.)?
Reporting by account codes in detail and summary?
SPECIAL CONSIDERATIONS:
Do they support fax and data applications on a full quality basis?
Do they have related products (800 In-Wats service, travel cards, operator assistance, etc.) that are competitively positioned so you don't have to have invoices from a lot of carriers? Evaluate per minute rates and terms as described above.
Do they have multi-location access to serve your other offices?
Can they provide a consolidated, multi-location billing for your group of offices (i.e., for ease of payment and traffic analysis)?
CUSTOMER REFERENCES:
You should call contacts from within your own organization size range and industry if possible, especially to people you know who will speak candidly to you. Check with the associations you belong to see what their experiences are and if they have done this research for you.
Use these criteria to shape your questions and to find out if customers are satisfied and if they performed a careful evaluation (they may be blindly happy). Avoid calling a "primed" reference by selecting randomly from a large list.
TEST CALLING:
Place test calls to your frequently called destinations, and conduct tests during your peak hours and days.
Consider a partial implementation with a carrier on a test basis by converting only one line, and clock your test calls so you can compare invoiced durations to actual measured durations. Watch carefully for very short calls being adjusted upward in duration, and no answer calls being billed.
Place test calls from your fax machine, as the demand for line quality is more critical on data transmissions. Similarly, make test calls from your PC modem. This is where you will see problems first.
RESELLER PERSPECTIVE:
The carrier's network structure, in terms of extent of leased circuits and amount of reselling, is not very important as long as the above evaluation criteria can be successfully met. Each carrier can be as reliable and effective as the quality of their collective system of leased and resold services (and related backup arrangements).
Don't be afraid of local/regional carriers . . . most have as good (or better) overall network as the big carriers because they carefully select each circuit to lease and are not stuck with huge capital investments in outdated technologies (i.e., older analog and digital microwave radio facilities).
DETAILED PROPOSAL:
Insist on a thorough proposal detailing the answers to your questions. If they won't put their promises in writing, you likely won't see the desired results. High quality carriers have all of these points researched and documented.
After the new service is implemented, compare your invoices to the proposal to be sure you are being billed correctly.
* * * * * *
George Cofran can be reached at Cofran & Associates, Inc., 9242 RR 1320, Johnson City, TX 78636, at 281-300-7177, e-mail: visitor@cofran.com.
As an independent telecommunications consultant, he welcomes
inquiries and discussion on telecommunications.
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