Intercarrier compensation

Definition
Intercarrier compensation refers to

{{Quote|the charges that one carrier pays to another carrier to originate, transport, and/or terminate telecommunications traffic. Federal Communications Commission, Intercarrier Compensation (full-text).

Overview
Although the same or similar facilities are used to originate, terminate and transport all types of traffic, the rates for intercarrier compensation vary based on several factors:


 * Where the call begins and ends (whether the call is local or long distance, and whether it is interstate or intrastate)
 * What types of carriers are involved (incumbent local carriers, competitive local carriers, long distance providers, wireless carriers)
 * What type of traffic (wireline voice calls, wireless calls, data bound for an Internet service provider).

Intercarrier compensation payments are governed by a complex system of federal and state rules. There are two major forms of intercarrier compensation &mdash; access charges and reciprocal compensation.

Source

 * Federal Communications Commission, Intercarrier Compensation (full-text).