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We try to help keep our customers informed of changes in the telecommunications industry and the impact of those changes on our customers.

As you may have heard or read, recent FCC decisions have changed the way long distance companies are charged for access to local networks, and have also increased the long distance carrier's contributions to the Universal Service Fund (USF). These charges are industry-wide, and although each long distance carrier may handle the new charges differently, longdistance.com will handle these costs as follows:

Universal Service Charge (USC)

The FCC has required long distance carriers to contribute to the USFund to assist with the cost of providing basic telephone service to rural communities and low income users. Now, this contribution has been expanded to help schools, libraries and eligible health care facilities in obtaining leading-edge telecom services. This charge has been itemized on your bill over the past few years as "Interstate Lifeline Assistance" and "Universal Service Charge" and was calculated on a per-line basis. The recent changes now compute this charge based on usage.

Pre-subscribed Line Charge (PICC)

The FCC has initiated a per line charge that long distance carriers must pay to the local phone carriers for access to their local networks. This means longdistance.com must pay your local carrier a fee for every telephone line you have subscribed to us for long distance. This charge is based SOLELY on pre-subscribed lines and does NOT pertain to, Calling Cards, Toll Free numbers, debit cards, or other services.

• First 2 lines -- No charge

• 3 or more lines - $2.75 per line starting with the 3rd line

• Centrex lines - $0.48 per line

Payphone Compensation Charge

Due to recent FCC rulings governing pay telephone compensation, ALL long distance companies are required to meet the compensation standards as defined by the FCC's report and Order in CC Docket 96-128, FCC 96-388.

Effective October 7, 1997, we are responsible for collecting an additional charge for toll free calls made using a payphone. This would include all 800, 888, 877, 866 and 800 Pin, Ultimate Card and Calling Card calls. This means if someone calls you from a payphone using your toll free numbers, YOU will be charged for this call.

We, along with other companies, have been battling to challenge this additional charge to payphone calls. To date, we have only been successful in reducing the amount of the charge, not eliminating it. As a consumer, we encourage you to contact your Representatives in Washington, D.C. and voice your opinion regarding this additional charge.

On future billings, these calls will be denoted on your bill with a "P" to identify toll free calls that were made from a payphone and assessed this additional charge, which is $0.30 per call.