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Least-Cost Routing Threatens Rural Phone Call Completion 205

Posted by timothy
from the back-to-pigeons dept.
New submitter kybred writes "Rural landline users are increasingly having problems with incoming calls not completing or being dropped. The culprit may be the bargain long distance carriers penchant for 'least cost routing' combined with the conversion of the Universal Service Fund to the Connect America Fund. From the Fine Article: 'Rural phone companies are the victim here," Steve Head says. "They charge a higher rate to terminate calls as it costs more for them. Shoreham Tel gets beat up because everyone calls them and says something is wrong with your system, but it's not. We've been through all of their lines and equipment and there is nothing wrong with it; it's the least-cost routing carriers.'"
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Least-Cost Routing Threatens Rural Phone Call Completion

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  • by Herkum01 (592704) on Saturday December 01, 2012 @12:43PM (#42154807)

    I had to deal with this in our corporate PBX, we connect to a provider who does god-knows-what with the call. They do this least-cost routing, but when the call does not arrive it is on the customer to figure out WTF is going on. The provider saves .01 cents on your phone call and the customer pays for the call AND the support! What a way to run a business.

    • It's up to the customer(s) to get together and test the different phone services that are doing this and make a detailed case to the FCC and FTC. If a irrefutable case can be made, one of the above organizations will fine the telco in question, hopefully for a large enough amount the telco decides it's not worth it.

      Anyway, if you think this is happening complain to the FCC.

      • It's up to the customer(s) to get together and test the different phone services that are doing this and make a detailed case to the FCC and FTC.

        This is totally impractical. In order to test for this problem you need to make automated repeated long calls from many different locations towards a particular number and prove that it is statistically much worse than other numbers elsewhere. The only people who have this capability are the phone companies and even they don't all do it that widely.

        Now that this has been reported, basically the FCC should demand that carriers, especially cheap VOIP providers, start testing it and audit them to make sure

    • by TheRedSeven (1234758) on Saturday December 01, 2012 @01:51PM (#42155245) Homepage
      So if that provider is Verizon, and they save the .01 cents say, 100,000,000 times, that means they're saving about $1,000,000.00. Right [youtube.com]?
      • by icebike (68054)

        So if that provider is Verizon, and they save the .01 cents say, 100,000,000 times, that means they're saving about $1,000,000.00. Right [youtube.com]?

        RTFA.

        The provider is not Verizon. If Verizon had a presence in these small towns there wouldn't be a problem. Its precisely because Verizon has no direct
        route to these small rural companies that this problem has developed. Verizon hands off said calls to contract carriers who accept the call, calculate the price, and promptly drop the call. Verizon is none the wiser. The receiving party never gets the call, and is none the wiser. The calling party is left wondering WTF?

        From TFA:

        Least-cost routing can lead to dropped calls. What happens essentially is when one dials into Shoreham the call may be routed through, for instance, a Verizon router, and is then handed off to one of the hundreds of discount long-distance carriers. When this carrier’s computers quickly calculate that the call is a money loser because Shoreham Tel is allowed to charge a fraction more to access its lines, the secondary carrier simply drops the call.

  • by IamTheRealMike (537420) <mike@plan99.net> on Saturday December 01, 2012 @12:51PM (#42154847) Homepage
    Traffic pumping [wikipedia.org] is/was a practice that essentially let rural US phone companies suck money directly out of large carriers bank accounts. The various regulations in place over the telecom industry meant that companies like AT&T couldn't do anything to stop it.
    • by faedle (114018) on Saturday December 01, 2012 @01:30PM (#42155097) Homepage Journal

      That's the irony here. Least-cost routing is one "equal and opposite reaction" to the "sender pays" system and the way calls are billed at termination.

      Many of the rural exchange operators signed deals with carriers like Level3 who operated large dialup modem pools in rural exchanges near big cities are looking for ways to use that interconnect. It's really hard to feel "sorry" for these rural phone companies when they went out of their way to get this traffic in the first place 10-15 years ago, and now have these same carriers representing a significant chunk of their business instead of just 1-3%.

    • by Technician (215283) on Saturday December 01, 2012 @04:03PM (#42156263)

      These rural phone companies also host free teleconfrence centers and chat lines. The goal is to have lots of callers with lots of time on the service. Many phone companies don't like the heavy drain of money to fund these free services. Low cost and free phone services are the first to pull the plug. Alternative phone services simply refuse to pay termination fees for low cost or free phone services to those rural companies. If you want to see this first hand, use Google Voice and call a free confrence room hosted in Iowa. It won't go through. Most VOIP servies block this money hole. ATT tried to block or charge LD fees to call these services, but the court blocked them.
      http://www.techdirt.com/articles/20090925/1607516327.shtml [techdirt.com]

  • "Free" market fail (Score:5, Insightful)

    by Jawnn (445279) on Saturday December 01, 2012 @12:53PM (#42154857)
    If the telecom industry had not been regulated, people who lived in rural areas would have have gotten phone service. One might rationally argue along the lines of "Too damned bad. Move to town, ya hick.", but most people would not. The phone service is a utility, a vital one. As such the phone company was granted certain benefits (rights of way for the stringing and later, burying, of cable, for example). In exchange it agreed to wire rural areas. There's more involved than just that, but you get the idea. Without regulation, things would have been a mess, with consumers held hostage. Regulation can fix this scenario too. It's complicated though. You can't just telll the LD carriers "you must complete this call" if doing so costs them more than they charge. Likewise, the small rural phone companies must receive enough revenue to maintain their operation. And of course, wireless muddies things even further. The only way this is going to get fixed is if sane regulation is brought to bear.
    • by icebraining (1313345) on Saturday December 01, 2012 @01:40PM (#42155171) Homepage

      People don't need to move, they just need to pay enough so that their carriers won't charge higher fees for incoming calls.

      Saying "regulation can fix this scenario" without specifying how is senseless. The bottom-line is, any regulation you impose in this case just passes the extra costs from rural citizens to everyone else. Therefore, if you as a society think that cheaper phone service is indispensable, you just impose a tax on everyone's phone bill and use it to subsidize rural users.

      Personally, I see nothing wrong with having people pay the extra cost of living in the rural areas. Not to mention that other stuff (e.g. land) is cheaper than in the cities.

      • Saying "regulation can fix this scenario" without specifying how is senseless. The bottom-line is, any regulation you impose in this case just passes the extra costs from rural citizens to everyone else. Therefore, if you as a society think that cheaper phone service is indispensable, you just impose a tax on everyone's phone bill and use it to subsidize rural users.

        Personally, I see nothing wrong with having people pay the extra cost of living in the rural areas. Not to mention that other stuff (e.g. land) is cheaper than in the cities.

        I disagree, when you have a complex problem saying that using a means to force action that has yet to be determined can be the start of getting things done. Then you need to form some sort of committee and work out what the best option is and it will likely end up being some kind of new rules to the game. The fact that the problem exists proves that self regulation of the market is not working in this instance and the government will have to step in in order to prevent the citizens from getting screwed b

        • There's no market failure. The market isn't a magical way to create free lunches. It costs more to get a line to rural areas, and someone has to pay for that.

          "The government has to step in" is a meaningless statement. The government doesn't have a magic wand that can make rural connectivity as cheap as urban. The only thing they can do is pass the costs to everyone else.

          • There's no market failure. The market isn't a magical way to create free lunches. It costs more to get a line to rural areas, and someone has to pay for that.

            "The government has to step in" is a meaningless statement. The government doesn't have a magic wand that can make rural connectivity as cheap as urban. The only thing they can do is pass the costs to everyone else.

            This isn't a case of the market charging people more in rural areas, it's a case of the market failing and not providing service to people in rural areas. It's more than just an inconvenience - telephone service can be the difference between life and death in emergencies. It's probably much more important than electricity.

            • by DarkOx (621550)

              telephone service can be the difference between life and death in emergencies.

              So can living an hour closer to a hospital. What's point? There are risks, costs, and many benefits to living in any place. Weigh them and take your choice.

              Should we have to build a ER in every small town? Do we need a fire station within 5min of ever country house along some road? Where do you draw the line? I have relatives that would probably be alive today if they had access to better emergency services and communications. I don't fault society though, they chose to live where they lived and lov

      • by Darinbob (1142669)

        Regulation did fix the mess, past tense. It wasn't until AT&T was broken up for straying too far from what it agreed to and market forces took over that things started becoming a mess again.

        • Good or bad, that regulation did what I said it can do: it imposed a cost on everyone else to subsidize more expensive lines.

    • by MtHuurne (602934) on Saturday December 01, 2012 @01:52PM (#42155249) Homepage

      You can't just telll the LD carriers "you must complete this call" if doing so costs them more than they charge.

      The long distance carriers should take "you must complete this call" into account when setting their price.

      Likewise, the small rural phone companies must receive enough revenue to maintain their operation.

      Currently high fixed costs of maintaining the infrastructure are covered by higher per-call costs instead of higher monthly fees. Of course higher monthly fees won't be popular with people living in rural areas, but it would more accurately reflect the actual costs.

      The only way this is going to get fixed is if sane regulation is brought to bear.

      According to the article, there is regulation on paper but it is not enforced.

      • by amorsen (7485)

        The long distance carriers should take "you must complete this call" into account when setting their price.

        The challenge is that other carriers can swoop in and pretend to be regular customers, sending precisely the most expensive calls to a provider but using other routes for the rest of the traffic -- "cherry picking". Carriers will typically deactivate the accounts when they discover the cherry picking, but that is a whack-a-mole game. The carriers can just price all calls at slightly above the highest possible termination fee, but then they would not be competitive.

        The US can consider itself lucky in one way

        • by MtHuurne (602934)

          The challenge is that other carriers can swoop in and pretend to be regular customers, sending precisely the most expensive calls to a provider but using other routes for the rest of the traffic -- "cherry picking". Carriers will typically deactivate the accounts when they discover the cherry picking, but that is a whack-a-mole game.

          From the article it seems that is already happening: those low-cost carriers that do not drop the call often forward it to another carrier, who makes the same tradeoff and forwards it again and in the end no-one connects to the recipient.

          The only real solutions I can see is to either have uniform termination costs or have different quoted prices for routing a call depending on where that specific call is going. It seems the FCC is choosing the former, but that's a long-term solution. I'm guessing the latter

          • by amorsen (7485)

            The only real solution is to lower the actual termination costs by using cheaper technology. I.e. cell phones below 500MHz. I am having trouble imagining a place with low population density where that isn't cheaper than maintaining copper cables.

            Keeping long copper lines alive is not sensible. They cannot provide decent Internet access and they are too expensive for phone use. Do you know if mobile providers get the same great termination fees?

            If the market won't do it on its own because of the distortions,

    • The solution is actually pretty easy and straightforward... get fiber close enough to 99% of Americans to achieve at least 512kbps down and 192kbps up (minimum guaranteed sustained level of service for each end user into the nearest NAP, with the expectation that real-world speeds would be 4-8 times faster, and "end user" defined in a way that guarantees that a house with 4 human inhabitants could get 2mbps down and 768k up of guaranteed aggregate bandwidth into the nearest big-city NAP), and establish a re

  • by Anonymous Coward

    Hang on - it's 'least cost routing'. That means you do it for as little cost as you can mange, not that you only do it as long as it costs less than some arbitrary threshold.

    If you can't route it for more than what you charge (on average) then you're not charging enough. You can't just drop the call!
     

    • Re: (Score:2, Insightful)

      by Anonymous Coward

      Hang on - it's 'least cost routing'. That means you do it for as little cost as you can mange, not that you only do it as long as it costs less than some arbitrary threshold.

      If you can't route it for more than what you charge (on average) then you're not charging enough. You can't just drop the call!

      Sure you can, as long as the FCC doesn't catch you.

  • by Spazmania (174582) on Saturday December 01, 2012 @01:04PM (#42154921) Homepage

    Baloney. If least cost routing were at fault VoIP services like Vonage would fail long before a rural telco. Whatever the problem is at Shoreham Telephone it has nothing to do with least cost routing and everything to do with their technical infrastructure and choice of direct vendors.

    • by Jmc23 (2353706)
      Why would Vonage fail? Are you saying that the profitability of Vonage lies in not well connected rural areas?
    • You didn't read the article. It's not IP level least cost routing, it is Voice traffic carriers picking the "cheapest" (in terms of the complicated inter-phone company charging rules.)
    • The article is flawed - it calls the algorithm least-cost routing. In reality, it is a fixed-maximum-cost routing:


      if (cost_per_minute > ARBITRARY_CUTOFF)
              drop_call();

  • by kilodelta (843627) on Saturday December 01, 2012 @01:20PM (#42155027) Homepage
    The little local companies that completed the calls were getting astronomical call termination rates. They milked the cow until it was dry.

    So we need to revisit the termination scheme for telecom. Otherwise what will happen is that you won't be able to complete calls into the backwaters of the U.S. Only serves them right for getting greedy!
    • Re: (Score:2, Interesting)

      by Anonymous Coward

      How high are the termination fees? And who sets the fees?

      Just for comparison, effective today the new termination fees to landline numbers in Germany are between 0.25 and 0.61 euro cent. The fees are set by the federal network agency and of course with every fee reduction the carriers are bitching.

  • Yup - That's Us (Score:5, Informative)

    by vinn (4370) on Saturday December 01, 2012 @01:26PM (#42155055) Homepage Journal

    I live in southwest Montana and we're serviced by a rural telephone co-op. I work in Big Sky, Montana, and you might recognize that name because it's one of the biggest ski resorts in the country. This problem didn't really exist three years ago and has increased significantly in just the past year. For those of you unfamiliar with rural telephone co-ops, here's a smattering of what it's like.. because it's QUITE different than dealing with carriers or even your local CLEC:

    1. Rural telephone co-ops are exempt from the 1995 Telecommunications Act. That means all sorts of things, one of which was they were until very recently exempt from providing E911 service. (This is something your local PSAP probably takes for granted. We're about 15 years behind the times.)
    2. We can't call a lot of Google Voice numbers. I'm not sure why. Possibly it's because the local co-op has a problem with their dial plan settings, that happens. However, some Google Voice numbers do work. It's just weird.
    3. There's a lot of companies that provide hosted toll free numbers and provide both ACD-like services as well as collecting ANI so you can run all kinds of nice reports. We use services like that and increasingly we've run into a lot of problems because sometimes they outright can't transfer calls to our local DID's. Typically those kind of companies use cheapo LD carriers, but they also usually have a few PRI's with major carriers like AT&T. We usually have to request they change their default routing to use one of those carriers instead.
    4. On the flipside, we have surprisingly good Internet service. Three years ago we put in a 50x5Mbps connection and this year we augmented it with a 26x1. All of that service costs us $500 a month. That's not as spectacular of a deal as it was 3 years ago, but considering where we are, it's pretty impressive. At home, I've got fiber to our house - not bad for a community of 838 people.

    • by aaarrrgggh (9205)

      Can't the co-op terminate calls with anybody they choose? If you have a pipe, why wouldn't you tunnel SIP to the provider with the best/cheapest fees? "Peer" with local co-ops directly, and maybe even set up a clearinghouse for co-ops that brokers interconnects with the LECs and CLECs.

      • by vinn (4370)

        There's some things I don't understand, but this is my take:

        1. I have no idea why some Google Voice calls don't terminate. Something at the IXC / ILEC level probably comes into play and I don't understand how IXC's work here and what the relationship really is between our co-op and the ILEC (originally US West). My guess would be they're small and without much depth.
        2. Regarding, "If you have a pipe", do you mean us or the carriers? The reason we're not tunneling SIP is we have a traditional PBX (actua

    • You're paying $500/mo for phone+internet. I'm paying less than $60, and have never had the kind of problems calling other carriers like you describe. You are getting faster Internet speeds than I am, but I could get a 10mbit upload and half the download you're getting, and still keep my monthly bill under $100/mo, without needing to switch from DSL, and if I really needed the faster download speed, my provider will let me use MLPPP to bind multiple lines.

      You may consider it a good deal, but I don't. I would

  • by alen (225700) on Saturday December 01, 2012 @01:34PM (#42155117)

    The boonies are usually red areas that vote republican and spout off nonsense about being independent of Obama and the evil liberals who suck up all the money

    Here is your chance to practice what you preach
    Pay for your lifestyle

    • by Loopy (41728)

      Here is your chance to practice what you preach
      Pay for your lifestyle

      What the hell do you think we did before people got all up in our junk with taxes to support the inner-city welfare state? Here's a hint: counties didn't have road-grade equipment until recently, let alone right-of-way zones. We managed to make it through the industrial revolution with limited support from Washington and lower taxes; funny we can't live without 'em today, isn't it?

      Also, guess what? Our fire department (what there is of it)

      • by speedlaw (878924)
        Ethanol subsidies, wars in foreign lands, money to support governments that hate us. Oh, and send your kids (the military is high percentage heartland kids).
      • Generally the rural Red states get more back from the government than they pay in taxes.

    • Re: (Score:3, Insightful)

      by Solandri (704621)
      "Practice what you preach" only works in totality. Say I'm a landlord and raise the rent from $700/mo to $800/mo, but I now pay for the utilities instead of the tenants having to pay. If a tenant complains that he'd prefer to pay his own utilities and keep his rent at $700/mo, I cannot make him pay his own utilities and raise his rent to $800/mo and say I'm just making him practice what he preaches. I cannot consider what I want and what he wants, take only the parts which favor me, and truthfully call i
  • 59 percent (Score:5, Insightful)

    by fermion (181285) on Saturday December 01, 2012 @01:36PM (#42155133) Homepage Journal
    Let me say this as nicely as I can. 59% of rural votes went for Romeny. In my state, while Obama won the urban counties, the win in many rural counties was way North of 60%. Now, what were they voting for. Were they voting for smaller government and lower taxes, or just voting against minorities who steal tax dollars. I don't know, but the reality is that these people voting for a candidate who did not support the federal government building infrastructure that makes the US urban areas strong. So why do they expect the urban people to pay taxes so they can get cheap calls?

    And cheap calls is all it is. They want to pay the same as everyone else. Look, I spent a lot of time living in rural areas in the US and elsewhere. I know the issues. I know the costs. But I am not asking anyone else to pay costs that I choose in incur. In other countries you have phone service. You just pay for a cell phone. And if you have to you pay for a booster station. That is all there is too it. There are very few areas in the US that have no cell reception, and I am sure most would work with a booster. Hell, in my house I don't have good cell reception. Do I go to the feds and demand a personal booster?

    If you want reliable phone, do what others have done. Form a cooperative. Pull fiber to the community, and then have the individuals pull wire to their properties. Say this is too expensive, say that the feds should pay for it? Well them maybe you should vote for a liberal government who will tax enough to fund it?

    What I feel is really funny is that somehow taxpayers are expected to foot the bill so that people can just pick up the phone whenever they want to just to chat, and we are expected to pay for that entitlement. Give me a break. When I was growing up we often did not talk to our extended family. Why? Because it was expensive and we could not afford it. Maybe once a week on sunday morning, but that was it. I guess we had the advantage is that we were literate so we wrote letters.

    I normally am much more receptive to these complaints. We are a rich country so we should have universal reliable communication, health care, education, transportation, teleportation, rib eye, Helly Hansen clothing, but given that those people just voted in great majority against it, it seems a little over the top.

    • RTFA (Score:3, Informative)

      by Anonymous Coward

      The rural areas already have service installed and wire/firbe pulled to their homes. They have no need for federal assistance and who they voted for has NOTHING to do with this. (Can we please get past this election stupidity.)

      The issue is that because the routes to rural services cost more, many carriers and long distance providers will not route calls to them. That means that when Jr. moves to NYC and leaves Granny in BFE, Jr. can't call Granny. She has service and she can call him in NYC, but Verizon or

      • Re: (Score:2, Insightful)

        by Anonymous Coward

        "Free Nationwide Long Distance Plan". read that again. You are saying it is ok for Verizon to sell a "Free Nationwide Long Distance Plan" and then refuse to route certain calls because it is to expensive.
        I call that fraud. It is bait and switch. They can either not sell the plan at all or increase the price of it to cover their costs.

      • No, the actual fair and correct solution is:

        3. Rural customers' bills are increased to the point where they cover the extra costs for small-scale operations and more miles of wire per house. This may mean charging the rural customers per-minute for incoming long distance calls.

        Telcos from the boonies then have the funds so they can afford to charge their peers reasonable market rates for routing calls. Calls don't get dropped anymore.

        • by DarkOx (621550)

          Why is more reasonable to charge loop customers more but not carriers? Seriously if Verizon and AT&T want to offer sell unlimited nation wide LD they should either build out the last mile infrastructure themselves or pay the MARKET rate for call termination in that area.

          • Because those *particular* loop customers, who are way out there in the boondocks, cost more to connect to. The people out there enjoying all that open space and fresh air should pay the higher cost of their lifestyle choices themselves.

            AT&T and Verizon don't need to buy anything from anyone if they don't want to.

      • by DarkOx (621550)

        Right in this case its not the rural customer that is being subsided here. They are paying for their service, and their operator is providing termination to other carriers. Its these other carriers who don't like the rates. The problem is they want to offer unlimited nation wide long distance dirt cheap. Well then they either need to charge more or eat some margin when customers make high cost calls to rural telephone operators.

        The problem is not the folks in BFE, it Jr. in NYC is not willing to pay the

    • Let me say this as nicely as I can. 59% of rural votes went for Romeny. In my state, while Obama won the urban counties, the win in many rural counties was way North of 60%. Now, what were they voting for. Were they voting for smaller government and lower taxes, or just voting against minorities who steal tax dollars. I don't know, but the reality is that these people voting for a candidate who did not support the federal government building infrastructure that makes the US urban areas strong. So why do the

    • Were they voting for smaller government and lower taxes, or just voting against minorities who steal tax dollars. I don't know, but the reality is that these people voting for a candidate who did not support the federal government building infrastructure that makes the US urban areas strong. So why do they expect the urban people to pay taxes so they can get cheap calls?

      Because, despite who they voted for, they didn't get smaller government and lower taxes. What you're saying is that the people who vote for low tax/small government should still have to pay the high taxes imposed by the successful ideology and not benefit from the things the government spends that tax on.

      The conservative position consists of two points: low taxes and individuals paying for their own services. You can't impose high taxes, and then accuse them of betraying their ideals when they demand they a

  • Customers want to pay a cheaper rate for phone calls. Imagine that!

    Wouldn't it be great if we had a defacto monopoly that made sure that there was adequate revenue from long-distance calls to subsidize local service in rural areas, so that it wouldn't cost $300 per month to have a telephone? High-volume users would, of course, be paying for all the infrastructure to complete calls. It might even have side effects, like if phone calls were more expensive it might cut down on telemarketing (because it woul

  • by Anonymous Coward

    I work for a small rural telecom, and we deal with this issue quite literally every week. Someone who lives out in what most would consider the middle of nowhere, ends up having a call completion issue. And who do they blame? Their telephone company, of course. After all, we provide the telephone service, and people assume that a paid service is supposed to just work. Telling these people to move back to a city is ridiculous also, as many of them are running farms or performing other (sometimes astronomy re

  • Haven't the telcos ever heard of "Lowest Cost Spanning Trees?". This is what's done in internet routers to prevent exactly the kinds of infinite loops causing the problems there. Spanning trees still provide the carriers with the best available pricing for a given set of call end points over the available routers, but also ensure that infinite loops don't occur within the network, thus providing proper connectivity to the end user.
  • by Lawrence_Bird (67278) on Saturday December 01, 2012 @03:45PM (#42156115) Homepage
    Nice people. They try hard. But. Their services are overpriced and not reliable. You are forced into a landline, like it or not, to get dsl. (that landline runs 17.50 plus about 7.50 in FCC garbage which is pretty much what Verizoff charges in other locations). The DSL service is marginal. What is described as 'up to 6 Mbps' is in fact.. (for me) below 3 as the data transmission is unreliable faster than that. Their cable service is.. dreadful? Often goes out of service for long periods. While we all understand the economics of remote/rural telecoms, people should also keep in mind that Waitsfield Telecom has actively fought to keep other providers out of our service area. They could have competition but they have made sure they do not have it. The years of nobody else wanting to try to serve our area are gone over but as customers, we are denied those choices becasue it would likely mean the wend of Waitsfield Telecom.
    • I'm over the mountain from you in Cornwall and experience about the same thing. (The article from the OP was from our local paper.)

      In fact, Shoreham Telephone doesn't exist anymore. It was bought out by OTT from Maine and since then our DSL service has become a bit less reliable at about the same speed as you but with what I suspect is a higher cost. We have ongoing DNS issues now and just have to live with it. We do have the option of wireless service through a co-op (as mentioned above in one of the posti

  • I know I'm showing my age, but I really miss toll quality calls. You know, the polar opposite of the typical...hello....it'sssss bbbsx ... ble b. sors and then....s t boob bleeep blorp. So we'll meet then. bye....click

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