DS 98-185
Bell Atlantic
Petition to Revise Tariff NHPUC-No. 77 and Introduce the
"Weekend Choice" Plan as an Optional Residential Intralata Toll
Calling Plan.
Order Granting Conditional Approval
O R D E R N O. 23,083
December 11, 1998
On October 15, 1998, New England Telephone and
Telegraph Company, d/b/a Bell Atlantic (Bell Atlantic), filed a
petition with the New Hampshire Public Utilities Commission
(Commission) requesting authority to introduce a new optional
residential intralata toll calling plan called "Weekend Choice".
Pursuant to Order No. 23,065, the time to review the filing was
extended for an additional 30 day period.
Subscribers of "Weekend Choice" will be able to make an
unlimited amount of Intralata toll calls on the weekend at no
charge. All weekday calls will be billed at $0.15 per minute.
The minimum monthly charge per subscriber line will be $5.95.
There is no service establishment or subscription charge for this
service. "Weekend Choice" is available only to residential
customers who utilize Bell Atlantic as their local and intralata
toll service provider.
Along with the petition, Bell Atlantic provided an
initial set of supporting documents which suggested forecasted
average revenues per minute of usage (ARPM) will exceed the cost
of relevant access, a requirement pursuant to Order No. 20,916 in
docket DE 90-002. Based on the formula prescribed by Order No.
20,916, the current cost of relevant access is $.0775 per minute.
According to Bell Atlantic, customers migrating from
message telecommunication service or 603 CallAround to "Weekend
Choice" will double the amount of their current conversation
minutes during Weekend days. Concurrent with increases in weekend
conversation minutes, Bell Atlantic also anticipates the same
customers will suppress current weekday conversation minutes by
10%. Based on the Company's analysis of changes in customer
demand characteristics, the Company believes aggregate ARPM
generated by all "Weekend Choice" customers during the week will
exceed the relevant cost of access even though weekend calls are
free of charges.
After analyzing the initial set of Bell Atlantic
documents, Staff recommended that the Commission extend the time
to review the petition for an additional 30 days. In Staff's
opinion, the documents attached to the Company's filing did not
adequately support Bell Atlantic's assertion that ARPM exceeded
the relevant cost of access. At the time, Staff was concerned
the amount of unrated weekend conversation minutes would reduce
ARPM below the cost of relevant access. Subsequent to Order No.
23,065, Bell Atlantic provided a number of additional workpapers
in support of the petition. Based on an analysis of these
workpapers, Staff now recommends that the Commission grant
conditional approval.
New information provided by Bell Atlantic indicates
that, on average, weekend conversation minutes of those customers
most likely to subscribe to "Weekend Choice" will have to
increase by more than a factor of 3 times before the cost of
access will exceed ARPM generated by this service. Additionally,
Bell Atlantic claims that increases in weekend conversation
minutes are limited. In support of this assertion, Bell Atlantic
provided information about weekend calling patterns in New York
where "Weekend Choice" has been available since July, 1998.
According to this information, the average customer subscribing
to "Weekend Choice" increased the amount of their weekend
conversation minutes between the date of service introduction and
October, 1998. However, that increase is less than the critical
3.0 threshold factor for New Hampshire.
Because New Hampshire Intralata toll customers
subscribing to this service will have to increase their current
average weekend calling usage by more three times before the cost
of access exceeds ARPM, it is Staff's opinion that approval is in
the public interest. However, Staff recommends that the
Commission also order Bell Atlantic to submit "Weekend Choice"
reports on a quarterly basis for a minimum of two years from the
date of this order. In Staff's opinion, aggregate ARPM will
exceed the relevant cost of access for at least several months
after introducing this service. Over time, customer calling
patterns may change as a result of increased marketing efforts.
As customers change calling habits by postponing weekday calls to
the weekend, ARPM will decrease. Reports indicating by month the
number of subscribers, Weekday Conversation Minutes, Weekend
Conversation minutes, Total Conversation minutes, "Weekend
Choice" day rate ($0.15\minute), total actual usage revenue,
actual minimum bill revenue, total actual revenue and average
revenue per minute will provide the Commission with useful
information on the amount of increases in Weekend conversation
minutes by subscribers. In addition, a quarterly report will
indicate whether or not ARPM generated by the service exceed the
cost of access. With advanced notification from these reports,
Staff will have sufficient information to make additional
recommendations on modifying this Service such as increasing the
Weekday rate or charging for weekend calling.
After reviewing the petition and Staff's
recommendation, we find Bell Atlantic's request to be in the
public interest. Approval will provide the Company additional
flexibility to meet the demands of its customers. Because this
is a new service in New Hampshire, we will require the Company to
submit quarterly reports indicating by month the number of
subscribers, Weekday Conversation Minutes, Weekend Conversation
minutes, Total Conversation minutes, "Weekend Choice" day rate
($0.15\minute), total actual usage revenue, actual minimum bill
revenue, total actual revenue and average revenue per minute. We
will direct Bell Atlantic to submit quarterly reports for a two
year period from the date of this order. With the reports, the
Commission will be able to monitor increases in Weekend
conversation minutes and whether ARPM exceed the cost of relevant
access. If the cost of access exceeds ARPM generated from this
service at a point in the future, we will direct the Company to
immediately modify this service by either increasing the current
Day rate of $0.15 per minute, charging for weekend conversation
minutes or terminating the service.
Based upon the foregoing, it is hereby
ORDERED,that the proposed request is APPROVED with
Conditions ; and it is
FURTHER ORDERED, that Bell Atlantic file quarterly
reports as described above for two years from the date of this
Order. Reports shall be submitted no later than the 15th day
following the end of each fiscal quarter.
By order of the Public Utilities Commission of New
Hampshire this eleventh day of December, 1998.
Douglas L. Patch Susan S. Geiger Nancy Brockway
Chairman Commissioner Commissioner
Attested by:
Thomas B. Getz
Executive Director and Secretary