Verizon wants to shut down postpaid calling card, personal 800 services

Verizon (NYSE: VZ) has asked the FCC for permission to stop offering postpaid calling card and personal 800 services offered via its MCI subsidiary, illustrating the ongoing decline of legacy services as customers turn to alternative wireline and wireless options.

In an FCC filing that responded to three letters filed by individual customers regarding its discontinuation application, Verizon noted how postpaid calling card service and personal 800 usage has declined "significantly."

"The rapid adoption of mobile products and equipment as well as the popularity of competitively priced prepaid calling cards have led to significant reductions in customer use of these services," said Verizon in its FCC filing.

Calling card usage continued to drop between 2014 and 2015. Out of the over 300,000 MCI calling cards that were in service in 2014, only about 7,500 showed any usage in the preceding 24 month period. As of the end of 2015, about 5,500 of the cards had been used during the preceding two years, illustrating a 30 percent decline.

A similar trend is taking place in its personal 800 service. Fewer than 1,000 of the remaining 215,000 subscribers have have actually used the service during the same period. Since 2012, postpaid calling card revenues declined 75 percent, while personal 800 service decreased over 65 percent.

Verizon noted that "as customers have stopped using postpaid calling card and personal 800 services, they have migrated to other options."

A number of these options are widely available at grocery and convenience stores, including those from Verizon itself, AT&T (NYSE: T), eVoice, FreedomVoice and Grasshopper.

Some of these alternative services also are less restrictive than MCI's existing service, which mandates customers "may not retain the toll free number or any right therein when [their] Personal 800 service is discontinued." AT&T offers its "Easy Reach 800 service" to residential customers, while eVoice, FreedomVoice, and Grasshopper offer 800 numbers for small businesses.

Customers also have the option of using third-party services such as Skype, FaceTime and VoIP calling, which don't require cellular coverage and can leverage an existing Wi-Fi or broadband connection. Additionally, a number of wireless and wireline voice plans can be used for long distance or international calls without additional charges.

"Given the declining usage of these services and the multiple options available to consumers, it is in the public interest for the Commission to allow this application to be granted in the ordinary course," Verizon said. "The very few customer comments filed do not provide a basis for concluding that discontinuing these services would impair the public convenience or necessity."

For more:
- see the FCC filing (PDF)

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