Making the most of local exchange carriers means saving money on telecom expenses and getting the services your business needs. Choosing a carrier can seem overwhelming, since there are many choices among local exchange carriers.

Local exchange carriers may be either Competitive Local Exchange Carriers (CLEC) or Incumbent Local Exchange Carriers (ILEC). CLEC companies have existed since the Telecommunications Act of 1996, which deregulated phone service. ILEC companies are the carriers that were in place before deregulation. In addition to standard telecom providers, other carriers like cable and satellite providers may also offer local exchange service. To choose among local telephone carriers:

1. Evaluate small and large providers for local phone service;

2. Look at alternatives to standard telecommunications technologies;

3. Hire a consultant to get expert guidance on choosing a provider.

Action Steps to Get Your Best Deal on Local Phone Service
The best contacts and resources to help you get it done

Compare local phone service providers

Get information from all the service providers in your area before making a choice. Compare services and rates among small and large providers.

I recommend: Check your state utility commission to find out what providers operate in your area. The National Association of Regulatory Utility Commissions provides a map with links to the Public Utility Commission for each state. The Federal Communications Commission also offers a list of telecommunications providers.

Check out large providers that act as local phone carriers

Most large telecom providers offer local exchange services. Often they provide advanced technologies for phone service, like fiber optic and other high-speed services.

I recommend: Verizon is a national provider that features fiber optic, DSL and other high-speed offerings in some areas. Paetec is a nationwide exchange provider that offers voice and data as well as software and equipment. Cavalier Telephone is a large carrier with network coverage in many parts of the United States.

Look at technology alternatives in local exchange telephone carriers

Many local and national providers offer alternatives to traditional telephone service, like cable or satellite offerings. Services can usually be bundled to save money and consolidate bills.

I recommend: Globalstar offers satellite services, including data, voice and additional features like voice mail. Comcast offers cable service throughout the United States. Features include television, phone and Internet.

Hire a consultant to help choose a local telephone service provider

A telecommunications consultant can assist with analyzing current services and evaluating local exchange providers. Consultants are experienced with dealing with telecom providers and familiar with the services available. They will assist with choosing solutions to save money on local and long distance service. They can also provide guidance on purchasing and implementing equipment and software to manage your phone system.

I recommend: STC Consultants is made up of experienced, independent telecommunications experts offering voice and data consulting services to businesses. TechCaliber Consulting provides expertise and guidance on telecom upgrades and implementations.

Tips & Tactics on Making the Most of Local and Long Distance Phone Service

Helpful advice for making the most of this Guide

• •  Evaluate your business' needs and preferences when choosing among local carriers. Small providers may not offer the most high-tech services, but often provide excellent customer service and account management.

Residential phone service in the United States used to be pretty predictable. AT&T, known as Ma Bell, was the de facto phone monopoly. Phones were indestructible, residential phone service adequate and prices, well, high.

The states and, later, the U.S. Congress took a hatchet to AT&T, ushering in a new era of competition -- and confusion -- for consumers. Ma Bell was busted into regional pieces. Prices for residential phone service generally dropped, Then a big telecom bill, the 1996 Telecommunications Act, raised the heat even more by forcing the "baby bells" to allow startups, known as competitive local exchange carriers, or CLECs, to sell connections on their lines or otherwise compete for local phone service customers.

If that wasn't enough, a rising tide of non-traditional alternatives, including wireless, cable TV and Internet telephone systems, has pressured the residential phone service industry even more. There are seven different ways to dial a simple, seven-digit phone number these days.

In this guide, we'll review:

1. A local phone service primer
2. Residential phone service and alternative providers
3. How to choose a CLEC for your local phone service
4. Long distance providers
5. Local and long distance phone combined

Action Steps
The best contacts and resources to help you get it done

Choosing a basic local phone service

Choosing a straight-up local phone service is actually pretty easy. It's either the baby bell incumbent or a CLEC competitor. Generally, they offer the same service in the same ways, and even the same add-ons, like voicemail and operator services. Long distance providers usually work separately, although not necessarily.

I recommend: Several sites purport to offer head-to-head comparisons of local phone service providers, including Phone Dog and Connect My Phone. Be wary, though. Not all providers are listed in some areas. You can be thorough, too, with a WhitePages.com search for "local phone service."

Residential phone service, however, has many competitors

It's no longer completely necessary to go with a traditional wireline phone for your residential phone service needs. Cable and satellite TV providers, for instance, provide phone service, with some caveats: connections can vary in quality, and 911 service is still an issue.

I recommend: Among the most view cable systems in the country are Comcast, Time Warner, Cox, Cablevision Systems, and Charter Communications. If you have cable and don't like their phone offer, Vonage, Packet8 and Sunrocket are alternatives which use existing Internet to connect your phone.

Figure out if your local CLEC will work for you

Not all of the CLEC companies are equally well-managed. In fact, many went broke after the 1996 law changes because they were able to chase customers without first making investments.

I recommend: It can help to talk with local business owners about billing and customer service before making a decision on residential phone service. Since nearly any group can apply to operate a CLEC, even universities and towns, there are literally thousands. See the complete list of CLEC's registered with the Federal Communications Commission by selecting "CAP/CLEC in the search box.

Long distance providers are hungry for your minutes

One of the advantages of the long-ago AT&T break-up was the creation of a competitive national long-distance market. Rates have fallen as major carriers have jumped to soak up customers.

I recommend: Some of the bigger long distance providers include MCI, Verizon, Sprint, AT&T and Qwest. Take a look, too, at the Business.com directory page on local and long distance phone and long distance providers.

Local and long distance phone bundles save money

Usually, the strategy is to find the best local phone service you can from a CLEC, or see if you can 'bundle' residential phone service with other services from non-CLEC providers, like adding Internet, wireless, long-distance or pay television.

I recommend: Such "triple play" bundles (quad play if you add in a cellular phone plan) can get you lcoal and long distance phone service more cheaply than separately in most cases. See bundle offers from big providers like Verizon, Comcast and AT&T.

Tips & Tactics

Helpful advice for making the most of this Guide

• •  There's no good reason to fear your local CLEC. The telecom bust shook out most of the weak companies, so if a friend tells you the experience has been good, it probably is.
• •  Triple play offers from local and long distance providers can be full of hidden fees and long-term contract language. Be sure to measure each offer against its true, full cost, including taxes, and compare it to ordinary long distance providers.
• •  The best local phone service is the one you will actually use. Web-based telephony is cheap, but hardly a comforting experience (you have to fire up a computer, check the microphone, etc.). If you make a lot of long-distance calls, consider a flat-rate plan to a single number or country for local and long distance phone service.

Keeping up with local exchange carriers news and trends will keep you abreast of developments and activities at your local telecommunications carrier. Local exchange carriers may be either Incumbent Local Exchange Providers (ILEC) or Competitive Local Exchange Providers (CLEP). ILEC companies are those that were providing service when the Telecommunications Act of 1996 went into effect to deregulate local and long distance phone service. CLECs compete with ILECs. Local exchange carriers range from small providers to large national companies. How much choice you have in carriers depends on your location.

Keeping up with news gives you a chance to compare your provider to other carriers and allows you to analyze trends and news that may affect your rates or service. News and trends in several areas can have an influence on local phone carriers, including:

1. Internal changes and events at your local exchange carrier;

2. News and developments among local exchange carrier companies;

3. Trends and technological advances in the telecommunications industry.

Action Steps
The best contacts and resources to help you get it done

Get news about local telephone carriers

Keeping up with news and trends that affect local carriers can help you find ways to save money on your telecom bills. It allows you to compare your provider with the services and fees charged by others and find out how government regulation, new technology and other developments can affect your service.

I recommend: CNET provides breaking news and older articles about large and small exchange carriers. Government Technology Magazine provides a summary of the International Telecommunication Union's annual report.

Find information that affects your local phone service

Check with your local carrier to get information and news. Find out about company issues that could affect service or rates.

I recommend: The National Association of Regulatory Utility Commissions provides a map with links to each state's Public Utility Commission. Check your state utility commission to find out what carriers operate in your area. The Federal Communications Commission provides a complete list of carriers. Hoovers provides information about local exchange carriers.

Get information about industry trends that affect local phone service providers

The telecom industry regularly faces changes in technology. Voice over Internet Protocol (VoIP), Digital Subscriber Line (DSL), and other high-speed services can help to upgrade your local telecom service. Keep up with changes to see how these developments can benefit your company.

I recommend: Inc. Technology provides up-to-date articles about telecom and communications trends. FierceTelecom, which is part of the FierceMarkets Network, offers general telecom industry news.

Tips & Tactics

Helpful advice for making the most of this Guide

• •  Identify what technologies will best benefit your business or residential phone service. Talk to your carrier to find out whether these technologies are available and how they can be implemented.
• •  Weigh your options when you are considering local exchange telephone carriers. Smaller providers may not offer as many high-tech services, but often provide personal customer service.

Knowing local exchange carriers key terms helps you promote yourself professionally in the telecommunications field. Since a local exchange carrier typically competes with other established carriers, it's important to demonstrate your business prowess through strategic planning and optimal verbal communications.

Understanding local exchange carriers key terms also keeps you informed of service options and legal benefits you could take advantage of in business dealings. It gives you an edge over competitors when you understand the terms and reasoning behind them.

Action Steps
The best contacts and resources to help you get it done

Telecommunications

The word telecommunications, also called telecom, refers to systems that transmit messages used for communication over long distances. Often a telephone company will refer to itself as a telecom.

I recommend: To get a detailed look at telecommunications and what it entails, go to wiseGEEK. This site defines the term and gives historical examples of the evolution of telecommunications.

Incumbent local exchange carrier

An incumbent local exchange carrier (ILEC) in the United States is a local telephone company that existed when AT&T broke up into regional Bell operating companies, or 'Baby Bells.' This type of carrier is responsible for providing telephone exchange services locally in a specific geographic area.

I recommend: The Public Service Commission of Wisconsin offers detailed reports of an incumbent local exchange carrier. The reports include balance sheets, income statements and expenses, among other topics.

Competitive local exchange carrier

A competitive local exchange carrier (CLEC), also called a carrier, is a local exchange carrier that competes with established carriers, typically the incumbent local exchange carrier.

I recommend: The Public Utilities Commission of Ohio offers a detailed list of competitive local exchange carriers across America.

Data local exchange carrier

A data local exchange carrier (DLEC) is a type of competitive local exchange carrier specializing in digital subscriber line (DSL) services. It generally leases lines from local telephone companies then resells the lines to independent service providers.

I recommend: United Business Media offers a technology encyclopedia that defines terms such as the data local exchange carrier. It also gives a brief history of the term.

Telecommunications technologies

Local exchange carriers often provide cable and satellite services, prime examples of telecommunications technology. This term refers to the activity of maintaining, constructing and designing communications systems.

I recommend: Communication Certification Laboratory offers a detailed look at the history of telecommunications technologies. It begins communications history in 1200 B.C. and brings it up to the modern day with current telecommunications technologies.

Bundles

Local exchange carriers often provide bundles, also known as packages, of services such as telephone, Internet and television services. Customers often receive these services bundled together at a discounted rate as opposed to purchasing each of these services individually.

I recommend: Microsoft offers information detailing ways consumers save money by using telecommunications bundles. It discusses different services offered in bundled packages.