Inter-Carrier Comp Problems Result in Fraud

TechDirt points out that the USF and Inter-Carrier Compensation problems are now being exploited as arbitrage plays by VOIP providers. Termination to Rural ILECs is using very expensive - say $0.05 versus $0.005 per minute. Those rates are paid by your local phone company (in the story it is mainly AT&T). Lots of free services are in Iowa, including FreeConference.com. They partner with a RLEC and split some of the revenue that the other ILECs have to pay. When FuturePhone did this play for free international, AT&T sued for fraud. It is HIGH time that the FCC solved both USF and Inter-Carrier Comp (see Missoula Plan). [Aside: GigaOm announces FuturePhone's demise - and why].