Bill2Phone is an alternative payment system that allows purchasers of eCommerce digital content to charge transactions to their Local Exchange Carrier (LEC) telephone bill.
Contents
Process
In Bill2phone, a consumer receives a bill from their LEC on their regular monthly billing cycle. An additional page of eCommerce charges is appended to that bill by the clearing house in accordance to LEC guidelines as defined in a Billing and Collections (B&C) Agreement between the two parties. These charges are placed on the unregulated portion of the consumer's bill. Consumers remit payments for those purchasers directly to their LEC who further remits payment to the clearing house, who acts as a clearing and settlements provider to participating eCommerce Merchants.
History
Placing third party charges onto a telephone bill with B&C functionality has been in practice since the time of Bell System Divestiture and the Modified Final Judgement in 1982. As part of the breakup of AT&T, it was mandated that the resulting RBOCs, and subsequently most LECS, would allow other providers of telecommunication services to place their third party charges onto the LEC bill. The intent and result was to increase competition in the industry.
As telecommunication services are highly regulated and billing systems are complicated, an industry emerged as did standards (EMI) to simplify the process of taking the third party telephone records and placing those charges onto the 1400 US LEC bills. In the 1990s there were many long distance telecommunication providers, operator assisted telecommunication service providers, IXCs, and so forth who wanted to avert or defer the cost of implementing a costly billing system of their own, and by doing so, get to market more quickly. IXCs also understood that a single bill to the customer was desired. Companies like ZPDI, USBI, Integretell, Enhanced Billing Services (ESBI), OAN, ACI and many others emerged to reduce the integration complexities of these many to many relationships.
Billing for third party charges had for the longest time been restricted to telecommunications charges, Customer Premises Equipment (CPE), and Enhanced telecommunication charges (e.g. ISP services, voicemail). In 2005, the LECs having expanded their own initiatives into IPTV (IPTV: e.g. AT&T U-verse, Verizon FIOS), and Video on Demand, and with increasing penetration of DSL connectivity into the household, allowed for more content types to be billed to their bills. While there is no uniform standard for what is an allowable content type, it is safe to say that most digital content delivered over the internet has been acceptable as long as it meets the interests of the LEC consumer base.
As it is now possible to bill for digital content using the phone, a variety of changes to the standard data and financial procedures had to be implemented to satisfy the needs of the entire value chain: Consumers, eCommerce Merchants, Clearinghouses and LECs.