What’s Up with 712?
Ever wonder why it is that FuturePhone (now defunct), Radio Handi, FreeConferenceCall, and PartyLine Connect all have access numbers in the 712 area code? These services all claim to provide free services to you without a catch.
After a little research, I found out that you just have to make a long distance call to get them, so lunch isn’t entirely free. But I still wondered how these services get paid, and why are the access numbers all in Iowa?
According to Michael Arrington of TechCrunch, “the founder created his own telephone company in Iowa. Iowa is apparently the only state taking advantage of an FCC kickback scheme that gives telco’s a portion of the fees generated from every inbound call to an Iowa number. So when you call (one of those Iowa telco’s access) phone number, a portion of any long distance fees you are paying go to the company. The kickback is apparently authorized via the Universal Service Fund. These kickbacks are enough on average to more than cover the international outbound calling fees (which are mostly carried via VOIP schemes).”
Alex Saunders goes into a little more detail how these services get paid. “The short answer is tax subsidies. The 712 model, as I refer to it, is really a variation on the 900 number model, but financed by taxpayers. Take a low cost call, terminate on a high cost carrier, and pocket the difference.”
- The first of these subsidies is the Universal Service Fund. Tiny Iowa, with just under 3 million residents last year, was the recipient of $86.5 million from the USF. The USF pays for maintenance and improvements to those local telephone plants, in addition to subsidizing user fees for local residents. The cost basis to provide service in those communities is dramatically lowered.
- The second subsidy is the tarrif itself. Most Iowa telephone companies (and there are a lot!) participate in the NECA Access Fee Pool. The NECA publishes a tarrif, which each company participating agrees to use, and then they split the revenues. The termination charges for those tarrifs are a significant source of revenue for the local phone companies. And, because they’re rural, the charges are often steeply higher than to terminate in an urban setting. In the “NFL” cities, you might expect to pay 6 to 8 tenths of a cent per minute for termination. The NECA tarrif is closer to 3 whole cents. Arbitrage the subsidized rural rate against your costs and, presto, you’ve got a winner!”
Check out this nicely designed site
When Matthew Burton arrived at the Defense Intelligence Agency in January 2003, he was excited about getting to his computer. Burton, who was then 22, had long been interested in international relations: he had studied Russian politics and interned at the U.S. consulate in Ukraine, helping to speed refugee applications of politically persecuted Ukrainians. But he was also a big high-tech geek fluent in Web-page engineering, and he spent hours every day chatting online with friends and updating his own blog. When he was hired by the D.I.A., he told me recently, his mind boggled at the futuristic, secret spy technology he would get to play with: search engines that can read minds, he figured. Desktop video conferencing with colleagues around the world. If the everyday Internet was so awesome, just imagine how much better the spy tools would be.
I don’t know where I came across this site, but it puts you in touch with some serious data - predicting how airfares develop as a function of many variables, for example length of stay, day of travel, and where you fly. You can even slice the data any way you want, for example listing the cheapest destinations for a given day. One word: powerful.
While checking out some of the best work on the web, I came across this acclaimed site,