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monday, October 6, 2003
Cell number portability hits Lawrence in May
By Steve Schmidt
sschmidt@kansan.com
Kansan staff writer
A whole lot of switching could be going on in the realm of cellular phones after Nov. 24.
That's when a new telephone number portability rule by the Federal Communications Commission will take effect, requiring American cell phone companies to allow customers the option of switching providers while still keeping their old numbers — called number portability.
But the FCC is not yet allowing the option for Lawrence and other smaller towns. FCC Spokesperson Chelsea Fallon said the Nov. 24 date only applies
to the top 100 metropolitan areas in the country. That means students with big-city numbers — such as the metro Kansas City area — can make a switch, while students with smaller-town digits will be put on hold until further notice. The requirement will take effect for all numbers by May 24, 2004.
The new requirement stems from the Telecommunications Act of 1996, which required wireline carriers to implement number portability. The FCC carried that law into wireless phones a year later, leading to the new portability rule.
Fallon said the rule should serve as a great benefit to consumers.
"It's hard to say what will hap.
pen," Fallon said, "But hopefully consumers will have greater flexibility, better service, greater options."
This simple rule could send a significant ripple effect through the wireless world. People who have had their numbers for many years for business purposes and other reasons will be able to retain their numbers and move to different companies if unsatisfied with their providers.
J Sanders is the manager of Midwest Digital, 2121 Kasold Drive, Suite B, which sells services for Nextel and AT&T Wireless.
"People will be able to move around with a lot less hassle," Sanders said. "We lose deals
every day because people don't want to lose their phone numbers. They have a lot invested in it."
He said the option for customers to switch could possibly create a Darwinian "survival of the fittest" struggle as the six national companies —Nextel Wireless, AT&T Wireless, Verizon Wireless, Cingular Wireless, Sprint PCS and T-Mobile — could be merged into as few as four companies.
Sanders said he also wouldn't be surprised to see more people trying to get out of their contracts by paving deactivation fees.
"Your allegiance to a particular cell phone company is really going to be waived and prices are going to go down because you're
going to have a bidding war," Sanders said. "It's going to be a turning point, a kind of nexus for the stronger and bigger companies that can handle a flex in the market."
When the changes will hit remains unknown.
"You can never predict." Sanders said. "You can smell the change in the air, but you never can tell when it will happen."
From the side of local cell phone dealers, Sanders said, the rule should increase the amount of customers at his store, but there's a different view coming from companies' corporate headquarters.
"For us it's only going to be a blessing," he said. "The cell
phone industry might see it differently because there's going to be a huge amount of churn and a less amount of customers which will affect financial stability"
Kathy Domnanisch owns Simply Wireless, 1901 Massachusetts St. Her store sells Nextel and T-Mobile services. She said she doesn't anticipate any dramatic changes in the cell phone market, but added that the older companies have the most to lose.
"I think we'll gain some customers, but then we'll lose some sometime," Domnanisch said. "We'll probably be busier, but the end result will be the same."
Legislature attempts to keep credit from impacting state insurance rates
— Edited by Joey Berlin
By Steve Schmidt
sschmidt@kansan.com
Kansan staff writer
A good driving record doesn't always equal a good insurance rate. Credit card habits could also have an effect.
But starting Jan. 1, a new house bill from the Kansas State Legislature will try to keep credit ratings from having such an impact on insurance.
The bill, part of the Kansas Insurance Score Act, is an effort by the Kansas Insurance Department to monitor how insurance companies use customers' credit ratings to determine different types of insurance rates.
"What we tried to do was pass a piece of legislation which would regulate, for the benefit of the consumer, the use of consumer scoring," said Jerry Wells, director of governmental affairs for the KID.
Wells said the bill came about after it was discovered that insurance companies were using the credit rating system to raise rates for invalid reasons.
Among the new regulations is a
new mandate that requires companies to develop an internal appeal process, which must be approved by the KID, to deal with customers unhappy with their rates.
“That’s a remedy that very few states have, if any,” Wells said.
Insurance agents and KID administrators alike said there were always more factors when calculating rates, such as a person's gender, age, car and driving record.
Kummer Affiliated Insurers, 2721 W. Sixth St., Suite F, sells insurance from four different companies.
Owner Ted Kummer said there was a strong correlation between credit ratings and the risk of loss to the insurance company.
"A person that doesn't take care of his own finances as a whole picture, of course there can be exceptions, but usually that same individual doesn't care a darn about anything," Kummer said. "People who do not care about their credit ratings don't care a lot about anything including their driving habits."
credit rating because of its belief in this connection, Wells said.
The KID didn't outlaw the
Kummer said that each insurance company placed a different importance on credit ratings.
He said it was important to note that insurance agents never saw anyone's credit rating. Once someone's social security number is entered into the company's database, the credit rating is run through the company's pre-established rating scale and assigned a value.
Shelter Insurance agent Lance Wollesen, located at 1120 E. 23rd St., said the consumer score reflected the customer's stability, but the driving record was still most important to his company.
He said in a worse-case scenario, someone's rate could increase by as much as 50 percent if that person had bad consumer credit history, even if that person had a good driving record.
J. Robert Hunter is the director of Insurance for the Consumer Federation of America. He serves as an actuary, a mathematician that helps set insurance rates and makes sure the rates are fair and not too high
Hunter said that, unlike other correlations in the realm of car insurance, the relevancy of credit ratings had not yet been proved with verifiable statistics.
for consumers.
"Even if they're right, there's no thesis," Hunter said. "There's no legal argument."
He said that among the recent movements in 40 states during the past two years on this issue, Kansas produced a weak bill. Kansas' bill largely followed suit of the model bill published a year ago by the National Conference of Insurance Legislators, he said. It's a route that many states have taken.
Hunter said the bill was weak because it only banned the practice of determining insurance rates through credit ratings alone; a procedure no insurance company has ever practiced.
- Edited by Ashley Marriott
Hunter said the credit rating system hurt low income customers the most, among its other problems.
"Until somebody can explain it, it shouldn't be used," he said.
Syria demands U.N. condemn Israeli raid
The Associated Press
UNITED NATIONS — Syria demanded the U.N. Security Council condemn an Israeli air raid on a purported Palestinian training camp near Damascus yesterday. Israel's ambassador defended the attack, accusing Syria of harboring terrorists.
The emergency meeting of the council was called at Syria's request. Syria's U.N. Ambassador Fayasal Mekdad called on the 15-member body to adopt a resolution condemning the attack as "military aggression."
Israel continues "to flout the Charter of the United Nations to the point that Arabs and many people across the globe feel that Israel is above the law," Mekdad said.
Syria's draft calls for Israel to stop acts that could threaten regional security. It was unclear when the council would vote on the resolution, but a decision appeared unlikely yesterday.
The Israeli raid — on what it claimed was an Islamic Jihad training base — came in retaliation for a suicide bombing carried out by the Palestinian militant group Islamic Jihad on Saturday. The bombing, at a restaurant in the Israeli coastal city of Haifa, killed 19 people and the bomber.
Israeli Ambassador Dan Gillerman, speaking after Mekdad, accused Syria of providing "safe harbor, training facilities, funding, logistical support" to terrorist organizations.
U. N. Secretary-General Kofi Annan condemned the airstrike, and a statement from his office said the U.N. chief was concerned that the "escalation of an already tense and difficult situation has the potential to broaden the scope of current conflicts in the Middle East."
Syrian Foreign Minister Farouk al-Sharaa had called for the Security Council meeting in a complaint to Annan and the president of the Security Council, currently the United States.
warsan.com
The United States appealed for restraint on all sides, but accused Syria of harboring Islamic Jihad and other terror groups. Gillerman said he did not expect the United States to support Syria's resolution.
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