DATE: Thursday, November 20, 1997           TAG: 9711200503

SECTION: BUSINESS                PAGE: D1   EDITION: FINAL 

SOURCE: BY LON WAGNER, STAFF WRITER 

                                            LENGTH:   79 lines

$969,000 PHONE BILL DERAILS COMPANY'S INTERNET SERVICE COMPLAINT TO FCC ALLEGES FALSE BILLING WITHOUT WARNING BY 360 (DEGREES)

Global Connect Inc.'s Internet business plan fell apart when its bill for three cellular phones jumped from $74 to $606,000.

And those charges only covered one month, August.

The 154-page bill for the three phones from Aug. 28 to Sept. 16 was another $363,772.33.

How the Newport News company's bill got that high is a story of its innovative plan to bring the joys of e-mail, Internet chat and Web surfing to rural locales such as Isle of Wight County, Ivor, Zuni, Wakefield and Boykins.

The company launched its Internet service in the farming areas west of Hampton Roads three years ago with the three 360 Communications (formerly Sprint Cellular) cellular phones.

Peter Conway, Global Connect's president, figured out he could take advantage of 360's vast local calling area by permanently forwarding the phones to Global Connect's modem bank in Newport News. Global has a couple of thousand other customers who dial directly into its Newport News modems.

The cellular set-up worked for three years, until 360 announced that in August it would begin charging airtime for forwarded calls, 360 said spokeswoman Mary Ann Welch.

360 tabulated Global's August airtime at 1.2 million minutes, according to the FCC complaint.

When Global didn't pay its August or September bills, 360 disconnected its phones. Global responded this week with a complaint to the Federal Communications Commission, alleging 360 terminated its service without notification and falsely billed the company for airtime.

360 has not been formally notified of the complaint, Welch said. An FCC spokeswoman did not return calls inquiring about the complaint's disposition.

360 has known about Global's method of providing rural Internet service from the beginning, Conway said. The bills skyrocketed because the company changed its billing system, he said.

``When we purchased the first phone, I said, `Look, a colleague of mine explained that I could do this and I want to run it by you so I don't wind up with an outrageous bill,' '' Conway said of an early meeting with Sprint Cellular.

What Conway learned is that a call from a landline, forwarded through a cellular phone to another landline, is on the cellular transmission network but an instant.

A customer in Zuni, for instance, would dial Global's cellular number, the call would bounce to the nearest transmission site, then travel to Newport News over the GTE Corp. and Bell Atlantic networks, Conway said.

360 says there's no such thing as a ``free'' phone call. While it is true that forwarded calls do not ``use realistic amounts of airtime,'' the traditional phone company that transmits the call bills 360, Welch said.

``When we decided to provide call forwarding as a feature, we never anticipated it would be used this way,'' Welch said. ``We're in the business to provide wireless service. We're not in the business to be an ISP.''

Some customers were using ``thousands the amount of airtime'' of the average customer, Welch said.

Until 360 changed its billing, Global had found a way to offer affordable Internet service to areas that had long been ignored by big providers such as AT&T, Bell Atlantic and Mindspring.

Those companies have shied away from rural areas because it costs tens of thousands of dollars to install or lease the equipment to provide local dial-up numbers. The payback is small: the industry standard is $20 a month for unlimited Internet use.

By the time 360 cut off Global, the ISP had signed up 300 to 350 rural customers, Conway said.

``I miss it, darn it,'' said one Carrollton woman who asked that her name not be used. ``My sister in Michigan and I had a chat room set up, and my phone bill went down and I wasn't padding GTE's pocket.''

Some Global Connect customers, though, said the company's call-forwarding system wasn't flawless.

Michael Rasnake, of Zuni, says his Internet use once resulted in a GTE long-distance bill for $350. Still, he says the Internet can keep rural residents from ``being so isolated.'' Rasnake's local phone service only lets him call one phone exchange toll-free - his own.

He used the Internet to keep in touch with other growers of orchids and mushrooms.

``I don't know if anybody anytime soon will serve this area,'' Rasnake said. ``I can't even get cable TV.''

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