FCC New VRS Rate Proposed – It will KILL VRS Business
It’s scary, FCC is proposing to cut 45% for the VRS rates. This would impact deaf community hard and we will not be able to have VRS at all. Just a perfect example, I found this interesting statement someone from Alldeaf member wrote this:
If 45% cuts were passed by FCC, there will be domino effect starting with SVRS, and will hit Purple which could easily overwhelm and may not be able to expand fast and meet holding time. If they fail to meet holding time maximum time, then FCC will not pay them, this can ultimate kick Purple out, then ZVRS and so forth. This could easily wipe out the whole relay service industry. This is scary scenario, because not just employees at VRS depend them, there are hundred thousand of Deaf people working for any compaies that makes relay calls to do their job. E911 could halt which leaves risk to those who may need 911 services. I can’t even explain more on what could affect.
To view the FCC Public Comment Document:
NECA Submission: http://hraunfoss.fcc.gov/edocs_public/attachmatch/DA-10-761A1.pdf
ZVRS Submission: http://fjallfoss.fcc.gov/ecfs/document/view?id=7020390383
ZVRS proposed payment tier system as:
- Tier I – $7.55 for 0 – 100,000 Minutes
- Tier II - $6.75 for 100,000 – 1 Million Minutes
- Tier III - $6.20 for 1 Million – 2 Million Minutes
- Tier IIII - $5.70 for 2 Million – 3 Million Minutes
- Tier V – $5.25 for 3 Million minutes or higher
Are you kidding me right? This is the most lame, stuipd and unprofessional tier pay chart. I suggest ZVRS to come up with something better than this.
SorensonVRS Submission: http://fjallfoss.fcc.gov/ecfs/document/view?id=7020445878
Ed Bosson quoted in the Sorenson’s ruling as follows:
“The FCC should not adopt either of NECA’s proposals for basing rates on providers’ historical costs. Both of these proposals would result in bankruptcy, chaos, and devastation for the deaf. One of these proposals prescribes rates so low that they would immediately drive all VRS providers out of business, forcing deaf consumers to revert to the laborious process of typing their relayed communications, and both of the historic-cost proposals would drive Sorenson out of business, stranding tens of thousands of deaf consumers and making it uneconomic for them to be served by any other provider. The Commission lacks authority under the ADA to adopt any VRS rate that would wreak such devastation.”
Official FCC Ruling Submision Document: http://hraunfoss.fcc.gov/edocs_public/attachmatch/DA-10-761A1.pdf
The ruling in text:
IP Relay providers to continue to file with the Fund administrator annual costs and demand data, as they
had in the past.4 The Commission stated that “this information, which includes actual costs for prior
years, will be helpful in reviewing the compensation rates … [adopted] and whether they reasonably
correlate with projected costs and prior actual costs.”5 Based on the data received from providers, the
Fund administrator indicates that VRS providers’ weighted average actual per-minute costs were $4.4603
in 2006, $3.9604 in 2007, $4.1180 in 2008, and $4.1596 in 2009.6
In the 2010 TRS Rate Filing, NECA presents various alternative calculations for determining an
interim VRS rate for the 2010-2011 Fund year. As with the VRS rates established in the 2007 TRS Rate
Methodology Order, NECA proposes sets of tiered rates: Tier I includes monthly minutes up to 50,000;
Tier II includes monthly minutes between 50,001 and 500,000; and Tier III includes monthly minutes
above 500,000.7 In one of its proposals, on which the Bureau particularly seeks comment, NECA then
calculates the rate within each tier using weighted averages of VRS providers’ actual historical cost data
for 2009, including allowances of 1.6% for cash working capital, 3.2% for growth to the Fund, and
$0.0083 per minute for ongoing E911and ten-digit numbering costs.8 This calculation results in rates of
$5.7754 for Tier I, $6.0318 for Tier II, and $3.8963 for Tier III. The Bureau also particularly seeks
comment on whether the Commission should adopt 2010-2011 interim Fund Year rates based on NECA’s
proposed use of weighted averages in calculating each of the tiers, as described in the 2010 TRS Rate
Filing.
NECA also proposes per-minute compensation rates for all other forms of TRS based on the rate
calculation methodologies established in the 2007 TRS Rate Methodology Order.9 These calculations
result in the following proposed rates: $2.256 for interstate traditional TRS;10 $3.1566 for STS;11 $1.6951
for CTS and IP CTS;12 $1.2985 for IP Relay.
Huh? What a joke, don’t you agree?
Voice your concerns to FCC by May 14th otherwise we will suffer. Don’t delay and ACT NOW!
File your comments at this URL;
http://fjallfoss.fcc.gov/ecfs/upload/display?z=mt345
That sound terrible. I already realize that if low rate doesn’t meet the budget to meet. Mean, they would cut interpreter and there will be long on wait call.
Hire interpreters isn’t cheap as FCC think so.
Comment by Sam the Deaf on May 8, 2010 at 2:09 am
The current discussion about rates are about simply maintaining the VRS services. The problem is that there many more developments needed in business application and integration to help Deaf get good paying jobs. These initiatives need funding and investment. There are back end systems and integrations into phone systems that need to come forth that allow a Deaf employees to be functionally equivalent to hearing employees. These types of innovation will not happen without government support because there isn’t profits high enough to attract development and research from the private sector.
It is in the US governments best interest to help Deaf get good jobs to reduce the 70% plus unemployment of the Deaf community. The investment in the accommodation tools will be repaid in taxes collected from workers and reduction of support payments. It only makes sense given that the technology is ripe and along with the VRS service this problem could have a happy ending for all.
First, to start with Americans needs the FCC to add 50 cents per minute across all tiers of the VRS rate for minutes that is ear marked for improving the accommodations that remove barriers for Deaf in the job market. This will leverage existing companies who have already been working in improving accommodation tools direction and add resources to them to make break needed breakthroughs.
Second, there needs to be another independent fund that focuses on the communication needs for technology outside of VRS services. This will add incentives and resources to create the missing pieces that are not VRS related around making point to point calls on a business level. Both existing VRS companies and new non-VRS companies would then have the money to invest, develop and market the advances to break down more communication barriers. This is expensive investment because of the needed expertise. I could see this fund being grant based with 50 million dollars over the next 5 years. To get this started it will take a unified effort to approach congress for the fund.
Comment by Cary Evans on May 8, 2010 at 12:58 pm
please do not ax vrs rate at all. i cant live without vrs. the vrs is blessed because english is my second language. please think hundred times than twice. thanks
Comment by Gilbert Borinstein on May 8, 2010 at 5:17 pm
the truth is that vrs companies are being reimbursed at a rate that is astronomical compared with their expenses, the Deaf community is suffering but not from regulation by the FCC its suffering by the lack of concern for them by the vrs companies that are meant to serve them being led through greed, good luck my friends, I hope the truth finds the light of day because it seems it certainly hasn’t so far,
cut the rates and increase accountability, tell us why the vrs companies being reimbursed per minute for millions of minutes per month are saying they’ll go bankrupt if their rates are reduced? tell us why the Deaf community that are employed by these companies as trainer installers are being paid just above minimum wage themselves? if these companies were so concerned about Deaf rights and Deaf equal opportunity they wouldn’t be busy exploiting them at every turn. Yay for the FCC at least attempting to hold those responsible to the community to a higher standard of service while trying to stop them from misusing the public funds that are used to subsidize their services!
Comment by Dawn Reyes on May 8, 2010 at 9:47 pm
If the US government would help the big companies with TARP and bailouts, then it is fair to expect the gov’t to help VRS companies, too, not with a bailout but with the continuance of the same rates, not a cut.
It would drastically reduce my instant communication with my children. It would increase dependence on the Middle East oil as I would have to drive to stores and businesses and ask questions which I could have easily asked through VRS. It would be a waste of gas spent driving all over town.
It would cause so many deaf people to lose jobs as many do depend on VRS.
Please maintain the rates.
Susan
Comment by susan stokes on May 8, 2010 at 10:35 pm
Our Deaf people need VRS and Please keep VRS. Thank
God bless of you
Comment by Randall Furlow on May 10, 2010 at 4:49 am
I am seeing a lot of post regarding greed. Unfortunately, I don’t see any proof that Sorenson was wasting money or making absorbent profits. I didn’t see any of the these comments providing any specific information about the costs associated with providing communication services for the Deaf by Sorenson. To calculate profit you need both revenue and costs this equals profit. They use terms like astronomical something like this. The facts are because the NECA organization do not collect all relevant costs to providing communications for the deaf, for example: deaf to deaf calling over the internet. How do we know what the actual costs are in the public?
So based on some guesses and rhetoric…
We should cut great services to VRS and deaf-to-deaf calling so we can make a point that executives in all industries make good money? Sink the ship to punish the captains? I could careless about what they make. We all know they make good money. The bottom line question is “Will Deaf be better off with less funding of these services?”
Will Deaf be better off with no improved technology? No. Will they be better off with less interpreters? No. Will they be better off with reduced support services? No. Will they be better off with longer hold times? Will sinking a company like Sorenson improve services? No. It will hurt it to the point where 10s of thousands of deaf people will be waiting in line for service again. I remember 10-15 minute hold times for VRS interpreters.
The comment that Sorenson will survive is not founded on any facts. They however are saying they will be facing bankruptcy at $3.89 in Tier III minutes.
Bankruptcy is a strong word and no one will win if VRS companies are forced to cut to the bone or go out of business. The only thing that will happen is that some people can say, “I’m Sorry, I didn’t understand it could be messed up that bad.” Now we have a crisis. All this to prove a point! Who suffers here? Good people on the bottom of the food chain losing jobs and getting reductions is needed services.
I believe that Deaf need VRS and deaf-to-deaf services to be better, there are still holes that need work.” We need to add more to the rates that are ear marked to improve the technology. There is plenty of money in the TRS fund. Why not use it for the benefit of the Deaf? Until all Deaf are satisfied with what accommodations they have compared to hearing people. Go to the FCC or SorensonVRS website and make your comment to save VRS across the board before it’s too late and all deaf are in a crisis.
Comment by SfromSorenson on May 11, 2010 at 5:44 pm
@DawnReyes – VRS providers WILL shut down their service. When they do, will you then cheer the FCC for making them accountable? You have no idea what you are talking about. So sad.
Comment by Dave C. on May 11, 2010 at 8:08 pm
The FCC’s Bureau of Consumer and Governmental Affairs recently issued a statement stating that the FCC supports VRS and that VRS is not threatened by the FCC’s Public Notice proposing rates for VRS. This statement from the FCC has also appeared on numerous websites.
Sorenson Communications is not at all surprised to hear that the FCC supports the mandate in the Americans with Disabilities Act (ADA) to provide functionally equivalent telecommunications for the deaf. But the FCC fails to mention that in addition to “functional equivalent telecommunications for the deaf,” the ADA also requires nationwide access and improvements in technology and efficiency. The FCC is completely incorrect to say that VRS as we know it today is not threatened by its April 30 VRS rate proposal.
Sorenson provides the vast majority of VRS to the deaf community. Sorenson has provided VRS access to more deaf individuals than any other provider and continues to be the frontrunner in providing access and support to deaf individuals who have never before used VRS service. Sorenson developed the first deaf-centric videophone offering the most functionally- equivalent communication service available. And Sorenson has done all of this efficiently, as we continue to develop next generation solutions that the deaf community has been greatly anticipating.
The rates that the FCC is endorsing will drive Sorenson, the leading provider of VRS, into bankruptcy. The FCC’s proposed compensation to Sorenson is $3.89 per minute. Sorenson’s true and audited costs are over $5 per minute. The FCC is incorrect in their assessment of what would happen if its proposal were adopted. Sorenson understands completely the impact the proposed rate would have on its business. It would be disastrous for consumers. If Sorenson is unable to sustain their business at $3.89 per minute, how can the FCC suggest that any other provider would be able to service Sorenson’s users at such a low rate?
Sorenson continues to strongly urge everyone who relies on VRS to communicate to tell the FCC the facts: The FCC’s proposed rate will force Sorenson into bankruptcy and will end VRS as we know it today. The FCC Chairman and Commissioners must be made to understand that any rate proposal that resembles the April 30 Public Notice, will be a death blow to VRS and to the ADA’s mandate to provide functionally equivalent telecommunications service, national access, technology improvements and efficiency for deaf telecommunication.
Michael D. Maddix
Director of Government and Regulatory Affairs
Sorenson Communications, Inc.
Comment by Trevor on May 11, 2010 at 8:13 pm
Here is a question to ask yourself,
Supposed FCC adopted that three tier plan as shown below
Tier 1 5.77/min
Tier 2 6.03/min
Tier 3 3.89/min
Now since Tier 3 shows dramatically decrease in pay out. Tell me HOW can smaller VRS companies be more motivated to expand and grow with expectation that their rate would drop that far? I bet you, with this plan, those who are in Tier 2 will no longer interest in invest and expand because they will know that they will stand losing money once they expand and move down to Tier 3. This would also discourage Tier 2 VRs from investing in Research and Development knowing that they won’t get their money back.
This is not effective speaking for future growth and development. And I believe it will be grave mistake and this propsal will not benefit Deaf community.
Who says that Research and Development is cheap?
Comment by Augie on May 11, 2010 at 8:19 pm
I support the change of rate due to overwhelm profits Sorensonvrs is making as they have 85% of the market, the rate change would humble down the ego of employee workers who brags who are the “best” . With the rate change, they would be able to do volume profit and still come out even. Gives the smaller vrs provider a chance to compet. the tier pay is pretty much the same except for tier III which I think is tad bit too low. SorensonVrs has spent million dollars in bonds and savings. I think SorensonVrs can survive just fine and just have to cut down their luxeries. They will live !! I am pretty sure FCC knows what they are doing and doing the best to control the spending which I don’t blame them as SorensonVrs made 40 to 60 percent of the profits… They won’t bankrupt. AS for example… inventor of the razor blade tool for men was sold cheap.. but he knows the profits are made up selling blades and earned millions !! Thats what SorensonVrs would have to do… Volume ~!!
Suggestion is DO YOUR HOMEWORK !!! Don’t listen to others. There’s always demand for VRS as long there is deaf people around :-)
Comment by Terry Baker on May 15, 2010 at 5:12 am
I support Sorenson Vrs to keep our Videophone for deaf people because when we had TTY has many mistakes what we got from Relay Service messages so please keep SorensenVRS open for all of deaf people around the world. Sorensen VRS is best for us as we have face to face so interpreter can understand very clearly what we are asking or talking to them than typing TTY and wasted paper rolls. Please don’t cut off the Silent World, there will no one can help people to receive the messages about job searching, doctors information and etc.
Thanks,
Heinz and Debbie Schmidt
Comment by Heinz Schmidt on May 25, 2010 at 12:58 am
i never call sorenson for any help to fix vp200 i am tech home i do it fix it save my time many people complaint about waiting too long to come fix or have tech support to come house to fix too bored… i fix it myself fuck tech sorenson support use money from FCC sorenson is dumb ass for wait too long to fix for people vp200 i feel sorry for them ….
Comment by DeathSorenson on September 17, 2010 at 12:09 am