Small VRS Providers Welcome FCC Freeze Proposal; Some Providers Knock Agency
Three small video relay service providers welcomed an FCC proposal to freeze their compensation rates in the face of ongoing regulatory cuts. ASL Services, Communication Axess Ability Group and Convo Communications Wednesday called the proposed rate stabilization helpful. But ASL said more needed to be done, and CAAG and Sorenson Communications, a larger VRS provider, criticized the agency for not going further to address industry concerns, or at least seek comment on its consensus proposals.
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The six VRS providers had asked the FCC in March to freeze their compensation rates, among other things. The FCC in 2013 adopted a four-year schedule of VRS rate cuts through mid-2017. The FCC Tuesday issued a Further NPRM that proposed a rate freeze through Oct. 31, 2016 for the three smallest VRS providers, which would have their current $5.06 per-minute rate returned to and kept at a $5.29 rate, retroactive to July 1, 2015 (see 1511030064). It also sought comment on other “measures that could enhance the functional equivalence of VRS.” The service allows the deaf and hard of hearing to communicate with phone callers through interpreters connected by video.
Convo said the FCC’s proposed pause in compensation rate cuts “for the smallest and emergent VRS providers is a critical step” for the company. “Although Convo has had robust growth in the past two years, we have yet to match the economies of scale applicable to the oldest and largest VRS providers who have had the benefit of building their business with historically higher rates,” said Convo General Counsel Jeff Rosen. “The per-minute costs of Convo are currently higher than those of the largest VRS providers [but] our costs are being steadily lowered through greater efficiencies and rigorous cost controls.”
ASL Services (Global VRS) said it was “encouraged to see the long-awaited” Further NPRM with a proposed rate freeze for small providers. “The Commission’s proposal is an important initial step to ensure that the Deaf and Hard of Hearing continue to have effective access to the necessary communications services,” said ASL, but it added that more remains to be done. “The Commission is aware that it continues to operate under a flawed rate methodology... Although the Commission did not allow for comments on VRS rate methodology, ASL/Global VRS will strongly recommend that the Commission address its rate methodology now. The rate methodology is at the core of where the VRS rate issues began. Focusing on rate methodology will provide a long term resolution to the VRS rate and service quality challenges the Commission faces.”
"As one of the three small providers, CAAG/Star VRS appreciates that the FCC supports partial stabilization for the three community-based and minority-owned providers who offer niche services to the Deaf Community in order to emerge into the VRS market,” said CAAG Vice President Jeremy Jack. “That being said, we are disappointed that the Commission chose not to adopt the United Providers' Proposal in full. CAAG/Star VRS shares serious concerns expressed by consumers and stakeholders that unless the FCC quickly moves to a market-based rate making methodology, then further rate cuts will lead to degradation of VRS quality for consumers and worsening working conditions for VRS interpreters."
Sorenson was the most critical of the Further NPRM. Despite the temporary relief for smaller providers, Paul Kershisnik, Sorenson’s chief marketing officer said, there will still be much uncertainty about what the FCC plans to do to rationally set rates for VRS compensation. He said the commission was “stubbornly clinging” to rate-of-return type regulation despite jettisoning it for other telecom providers. “All of the VRS providers are still extremely uncomfortable that the FCC has apparently not made any progress in developing and implementing a rational market-based rate-setting mechanism,” he said.
Kershisnik said Sorenson was disappointed the FCC didn’t even seek comment on the VRS providers' full slate of “common sense” proposals. “We said freeze the rates, while you set up a rational rate system, and in the meantime we’ll test and evaluate service-quality improvements,” he said. “But they want us to provide a higher level of service, while they continue to cut the compensation rates for 90 to 95 percent of the VRS minutes." The continuing rate cuts will either put some providers out of business or require them to continue reducing the level of service, he said. "Unfortunately, the FCC is about to take a huge step back when it comes to VRS.”