Hearing set to allow Native American Telecom to operate at Fort ThompsonOther telecoms worry about "traffic pumping," a practice in which small companies route traffic such as free conference calls over the lines of major long-distance carriers.
By: Bob Mercer, Republic Capitol Bureau
PIERRE — The state Public Utilities Commission refused to grant a certificate of authority Tuesday for Native American Telecom.
The commission will instead proceed to a hearing, starting June 7, on whether the company should be allowed to legally offer local exchange and interexchange service within the Crow Creek Indian Reservation.
Several major long-distance corporations are fighting to prevent Native American Telecom from receiving the commission’s approval. They want the commission to at least place restrictions on the company, which has been conducting business without the commission’s approval.
Native American Telecom attempts to makes money by billing long-distance providers for what are described to consumers as free services, such as conference calls. The calls are routed over other companies’ long-distance lines to Native American Telecom’s center at Fort Thompson on the reservation.
Native American Telecom then charges access fees to the long-distance companies for taking the free calls that were routed over their lines. In the telecom world this practice is known officially as access stimulation and colloquially as traffic pumping.
This controversy isn’t new nationally or in South Dakota.
For example, long-distance providers have battled with Sancom Inc. of Mitchell and Northern Valley Communication of Aberdeen in recent years, and the Legislature has tussled over how to regulate the practice.
Native American Telecom reportedly is owned by three parties, according to witnesses’ statements filed with the PUC.
They are the Crow Creek Sioux Tribe, 51 percent, Las Vegas-based WideVoice Communications, 24 percent, and Sioux Falls-based Native American Telecom Enterprise, 25 percent.
The Sioux Falls business lists two organizers, President Thomas Reiman, of Sioux Falls, and Chief Executive Officer Gene DeJordy. Dejordy was originally listed from Little Rock, Ark., at the time of the company’s creation in 2009, and more recently shown from South Port, Conn.
Native American Telephone wants to operate within the territory of Midstate Communications. Native American Telephone reached agreement with Midstate to confine its operations to the Fort Thompson local exchange.
As a result, Midstate and the South Dakota Telecommunications Association didn’t oppose the certificate request Tuesday.
But SDTA executive Richard Coit specifically noted for the commission that not objecting wasn’t the same as supporting Native American Telecom.