Alternative Payment Services have been a growing part of our consumer culture since the early 1980’s.  The Bell System Divestiture and the Modified Final Judgment of 1982 brought about a whole new way of billing for products and services.  The breaking up of American Telephone & Telegraph Company (known today as AT&T Corp.) mandated that the Regional Bell Operating Companies (RBOC’s) would allow other telecommunication service providers to place their charges on the Local Exchange Carrier (LEC) bill.  The goal was to minimize the monopoly of larger telecommunications providers and increase competition in the industry. 

Being that telecommunication services are strictly regulated and have very complicated billing systems, standards quickly began to emerge for the purpose to resolving the confusion associated with third party telephone records and charges placed onto LEC bills.  By the 1990’s the competition of telecommunication companies was fierce.  There were many long distance providers and operator assisted communication providers eager to get into the market.  As implementing a billing system can be costly, many of these providers had the desire to avoid this cost in order to reach the consumer quickly.  The third party billing system began as a novel idea to increase convenience, but over time, this convenience became more complicated.  The need for companies to specially handle this type of billing had become evident. 

Originally, third party charges were restricted to telecommunications charges and Enhanced telecommunication charges such as internet and voicemail.  By the year 2005, LECs began to bill for other services including Video on Demand, DSL internet service, and other miscellaneous services.  Currently there is no regulation on the type of service that can be charged to a telecommunication services bill. 

Over the years, third party billing has become a highly preferred method of alternative payment among consumers.  This method of payment is not only convenient, however.  It is a nearly sure fire way of protecting personal credit information divulged over the internet.  Instead of providing personal credit information, the consumer links the purchase to their monthly telecommunication bill.  The price is applied to the balance of their bill and can be paid at the due date. The process is convenient, simple, secure, and limited to dollar thresholds and service offerings.