A company that is running some CLECs of its own now offers its billing resolution solution to fellow CLECs who may also be victims of the telco billing process.

by Alex Goldman ISP-Planet Associate Editor [February 9, 2004]

Birmingham, Mich.-based Invivo is not the only organization to notice that telcos aren't always honest about what they charge their customers. The activist association TeleTruth, for example, is currently fighting a fierce battle in Pennsylvania, where it is trying to unite independent ISPs and angry taxpaying consumers.

Rather than fight, Invivo has decided to make a business out of its unpleasant experiences with telco billing.

The company's tangled history goes back a long way (in Internet time). It was founded in 1996, but did not enter the telecoms business until 1999. For the first three years of its existence, the company was in the recreation business. In 1999, the company had the opportunity to acquire some distressed CLEC properties.

Now, Invivo has several CLECs across the country, some profitable, many not. "We have seven CLECs in various states of dysfunction," says Tim Sefton, the company's CEO and former manager of SAVVIS' Michigan office. "The job is to turn them around. They're a big project."

Owning several CLECs, however, has given Invivo an insight into telco billing practices that most individual businesses could never achieve, providing the company with an opportunity to use its knowledge to open a billing consulting business. "We started to see patterns," explains Sefton. "Some are straightforward, like reciprocal compensation, and others are more complex, where the CLECs were not being compensated by the ILECs in the same manner as ILECs were for the same services."

"There are a lot of network elements that get overlooked," Sefton explains. "The CLEC is not charging the ILEC for them, but the ILEC is charging the CLEC for them."

Not every business can profit from Invivo's advice, Sefton admits. "We'll talk to a company, and get to understand their interconnection architecture. Then we'll look at their agreement with the ILEC, and come up with elements that are falling off the table. We'll structure the CLEC billing process to include those elements in the bill sent to the ILEC. For some, it won't work well. Others might find millions of dollars they could be billing for but aren't."

Invivo only makes money if its helps its customers. "We work on a contingency basis," explains Sefton. "For each dollar they get, we get about 15 cents. It's worked out well for both us and our clients."

Grow, CLEC, grow
For its own companies, Invivo is looking at entering new businesses and providing new services. Sefton is enthusiastic about the range of options. "DSL is a foundation to build a whole spectrum of services, such as video, voice and data," he enthuses.

Providing these services is getting cheaper. "The price of IADs is going down," Sefton notes.

For the future, though, Sefton is particularly enthusiastic about the possibilities offered by Wireless. "I would like to see more ISPs and CLECs get involved with wireless IP. I'd like to see more Wi-Fi nodes for cellular transmission. Some handsets now have two or three bands, and one s the Wi-Fi band. In the future, CLECs and ISPs will be offloading traffic from the cellular network to their own Wi-Fi network. That will enable them to enter the cellular market without the huge infrastructure cost of cellular towers."

Of course, for many ISPs, the primary attraction of Wi-Fi at the moment is simply its ability to circumvent the RBOC's last mile monopoly. As billing problems mount, this technology will become more and more attractive. And if independent ISPs build out a wireless architecture, someday the RBOCs will come calling, asking for access to the last mile. ISP owners are surely looking forward to that with glee. Any consumer trying to avoid the RBOC and its billing system should be equally pleased by the thought of this potential future.

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