CPP strikes again: AirTouch Cellular gives calling party pays a go

AirTouch Cellular is taking another stab at calling party pays, even as the service loses some momentum in the marketplace. Last week, AirTouch rolled out Select Pay in Denver, and it continues to offer a slightly different version of CPP in nine other states. Select Pay allows users to switch between mobile party pays and CPP. It also allows subscribers to create a VIP list of callers who don't have to pay for calls.

Last summer, the FCC began working to remove regulatory obstacles that prevent operators from offering CPP and sought comment from the industry on standardizing CPP notification. The FCC was supposed to issue an order in February but has pushed back the date.

Some operators and observers have since suggested that the prevalence of bucket plans diminishes the importance of CPP. Internationally, observers credit CPP - which is the norm everywhere but the U.S. - with a higher average of incoming calls, a higher average revenue per user and increased cellular penetration.

U.S. bucket plans have produced similar results, however. In fact, AT&T Wireless, the creator of Digital One Rate, recently discontinued its CPP offering in Minneapolis, which had been available for a couple of years. "When we did the One Rate, the take rate [of CPP] went down to nearly zero," said an AT&T Wireless spokesman.

Some CPP offerings haven't fared well because some roadblocks require operators to introduce limited offerings. Most CPP services today are only available in limited markets where long-distance calls can't be charged to the caller and CPP subscribers can't roam with the service.

"It can be successful on a limited basis, but on a nationwide basis - which would be the best - it would be incredibly difficult and not necessarily worth the effort put into it," said Stuart Adler, an analyst with The Strategis Group.

Billing is one of the biggest obstacles to widespread CPP offerings. A common billing method is for wireless operators to partner with local exchange carriers (LECs) that agree to bill the landline customers that place calls to CPP subscribers. On a nationwide basis, however, that could mean partnering with thousands of carriers. In addition, some wireless operators say that some LECs have refused to bill for the service. SBC Communications, for example, has declined to work with AirTouch through any of its holdings, including Ameritech and Pacifc Bell, said Deo Favorito, corporate product manager for AirTouch.

"The FCC should at least support mandatory billing by the originating carrier," Favorito said. AirTouch is frustrated by the difficulties of rolling out CPP, a service it believes customers could find very valuable.

In the states where AirTouch offers CPP, it works with U S West. AirTouch's existing CPP offering is enabled through U S West platforms. Its newer Select Pay offering is enabled through a platform operated by AirTouch and provided by AG Communication Systems. OAN Services, a third-party billing company, serves as a clearinghouse for the service.

AirTouch isn't alone in believing that CPP can be a valuable service. "If you combine offerings such as CPP with prepay, then users really are capable of managing expenditures for wireless services," said Brian Fontes, senior vice president for policy and administration for the Cellular Telecommunications Industry Association.