Free Online Conference Calling and Service Providers
This article gives information about free online conference calling services and their service providers.
Free Online Conference Calling is different from traditional conference calling in that it has no organizer fees and allows for multiple people to meet for the price of their long distance connections. Companies that provide free conference call services are usually compensated through a tax scheme arrangement with the local phone company, leveraging a government imposed fee for all incoming calls to rural areas such as central Iowa, USA.
Some background on the tax: On every long distance call in the United States including toll conference calls, the consumer is paying for origination (dial tone), transport, and termination (connecting the call). Each of these phone companies share a piece of the cost of the call. If it is the same phone company performing all three tasks (most likely the two largest phone companies - AT&T and Verizon), they keep all of the charge. This is known as Intercarrier Compensation and is intended to keep the telecommunications system functioning by having every phone company receive compensation for using their network.
In the case of free conference calling, the conferencing company strikes an agreement with the local phone company to receive a share of the tax received for connecting the call. Though not illegal at this time, this fee was intended to help pay for phone service to rural customers and was not intended to drive conferencing revenues. It is "free" to the host and participants of the conference call, but the connecting carriers such as AT&T, Qwest, and Verizon are paying the Government imposed fees to the "free" conferencing companies. These carriers have begun back billing the connected conference participants on their invoices to recover the fees lost to the "free" conference companies.
In the United Kingdom the prefix 0870 system is used by UK-based free conference calling providers in order to receive a rebate from every call from telephone company that owns the number. However in April 2009 Ofcom, the independent regulator and competition authority for the UK communications industries, announced that the rebate that is payable to the telecom's supplier when an 0870 number is used would be removed.