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| Empower yourself with the language of insiders. We decipher the arcane terms, epigrammatic abbreviations, and weird words used in the industry. |
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Access Codes
A way to access the long distance network of any carrier that has a connection at your local telephone company office. For example, dialing 10288 allows you to make a call over the AT&T network. Access codes are a handy way to protect your firm against long distance network failure. However, calling rates tend to be very high when using access codes.
Aggregators
Long distance providers that offer low rates by recruiting 50-100 clients and then negotiating a group discount with a long distance carrier based on the projected calling volume. Aggregators allow smaller companies to obtain rates typically reserved for larger companies, but add an extra level of bureaucracy when resolving service problems. See resellers, facilities-based carriers.
Baby Bells
The local phone companies created by the breakup of AT&T; in 1984. Originally there were seven baby bells; mergers have reduced this number to five.
Banded Rates
Programs that charge different rates depending on how far the call is travelling. Programs using banded rates may be more cost efficient for firms that make many calls to nearby area codes. See flat rates.
Billing Increments
How carriers round calling times for billing purposes. Billing increments specify the minimum amount of time charged for a call, and how calls are rounded once this minimum is met. Carriers traditionally round calls to the next full minute. Newer programs often set a minimum billing period of 30 seconds, and round subsequent calls to six-second increments. This type of billing will typically save you 10% compared to full minute billing.
Dedicated Service
A type of program designed for firms with large monthly long distance bills. Dedicated service means that your firm leases a line (typically a T1 line) between your PBX and the local office of your long distance carrier. You pay more for the leased line, but save money on each call made using the leased line. Dedicated service costs less on a per minute basis, since the long distance company does not have to pay the local service provider an access fee for each call. A T1 and dedicated service should be less expensive than regular switched service if you spend more than $5,000 on long distance per month. See switched service.
Facilities-Based Carriers
Carriers that maintain their own network of lines and switches for handling call traffic. Large firms such as AT&T;, MCI and Sprint are considered facilities-based carriers, but many smaller firms also use their own switches and lines for at least certain areas of the country. See aggregators, resellers.
Fiber Optics
An optical technology that can hold many calls on a single, thin strand of cable. Fiber optics allowed many smaller carriers to install high-quality phone networks at a relatively low cost.
Flat Rates
Programs that charge one rate for all calls made within the United States, regardless of distance. Flat rate programs may use different rates of daytime and evening calls. Flat rate programs are often cost efficient for firms calling distance areas of the country. See banded rates.
Long Distance Call
A call made between two different local area telephone areas (LATA). LATAs were originally area codes, but some LATA now contain two or more area codes to maintain local calling rates when new area codes are implemented. Calls made within a LATA are handled by a local telephone company.
Monthly Minimum
Certain calling programs require that you spend a certain amount each month on long distance service. Companies that fail to meet the monthly minimum may be penalized, or charged for the difference.
Off peak Rates
The cost of making a call before or after business hours. Some programs have two off-peak rates, with a low evening rate and a very low night rate. However, each program can define off peak rates for whatever times they want. See peak rates.
Peak Rates
The cost of making a call during business hours. Not all carriers define peak rates as the exact same hours of the day, which can effect your total cost. See off peak rates.
Resellers
Carriers that lease lines and switches from facilities-based carriers for handling call traffic. Although resellers tend to be smaller carriers, almost all carriers lease lines and resell the capacity for at least a portion of their network. See aggregators, facilities-based carriers.
Switched Service
Most small companies sign up for switched service plans, which use the local telephone company to connect your calls to your long distance carrier. Switched service is a bit more expensive on a per minute basis than dedicated service, but requires no additional installation or mon]thly payments. See dedicated service.
T-1 Line
A dedicated line between two points. T1 lines are used to carry voice traffic or data beween two locations. A firm leases a T1 for a fixed monthly fee, and can then send as much traffic over the line for free. T1 lines are often used to connect with a long distance carrier to obtain dedicated service rates. A T1 carries 1.5 megabits of data per second, or about 24 regular voice conversations. See dedicated service.
Term Programs
A plan that commits you to buying service for one to three years or more. Term plans generally offer better rates than month-to-month plans, but lock your firm into a single plan. In addition, term plan rates are usually not guaranteed, meaning your rates can later be raised by the carrier.
Waive Minimum
The minimum calling volume needed to waive the monthly service charge. Many programs for small businesses use a waive minimum of $25 or $100.
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