FCC takes initial steps on VoIP

FCC commissioners today took the first steps to determine the regulatory framework governing voice over IP by issuing a notice of proposed rulemaking (NPRM) for IP services and declaring IP-to-IP calling an information service.

"This NPRM is really the curtain going up on a new era of communications. That’s both exciting and daunting," FCC Chairman Michael Powell said. "This is the most important item in communications history, in some ways."

Commissioners expressed their intent to regulate VoIP minimally, but each indicated VoIP providers should fulfill social-policy obligations associated with E911, Universal Service, disability access and law-enforcement access.

"Paradoxically, we can only ensure freedom from regulation by initiating a regulatory proceeding," Abernathy said.

Abernathy also said the regulatory framework governing IP services should be federal in nature, a notion based on the fact that information packets theoretically can travel over routers located throughout the world, even if the call is very short. As a result, separating intrastate and interstate regulation "simply doesn’t work anymore," she said.

Such a regulatory regime, if adopted, would have a huge impact on state commissions, according to Bill Wilhelm, who represents VoIP companies in his work as a partner for the Washington, D.C., law firm of Swidler Berlin Shereff Friedman.

"That would give the FCC broader discretion to look at things and could constrain the ability of state PUCs to impose burdensome regulations on VoIP services," Wilhelm said.

Separately, the FCC took the expected action of declaring that the peer-to-peer service offered by Pulver.com’s Free World Dialup Service is an information service. This IP-to-IP calling service cannot be considered a telecommunications service because it does not provide transport and does not charge a fee, Abernathy said.

Commissioner Michael Copps cast the lone dissenting vote, saying the commission should not take action on the item before considering all the implications that will be addressed in the NPRM.

"This item troubles me, and it troubles me a lot," Copps said. "I think we’re leaping before we’re looking … There are lots of implications this doesn’t address."

One concern Copps noted was that "information services" are not required to meet requirements of the Communications Assistance of Law Enforcement Act, which could create problems in the future. While that’s technically true, Wilhelm noted that a clause in CALEA also requires companies deemed by the FCC as providing a "service [that] is a replacement for a substantial portion of the local telephone exchange service" also must cooperate with law-enforcement agencies.

Although expected, the Pulver.com decision provides some regulatory clarity on VoIP--a fact applauded by SBC Chairman and CEO Ed Whitacre in a prepared statement.

"We hope that state commissions will now set aside potential IP proceedings and begin working with the FCC on building the kind of environment that will nurture this technology," Whitacre said. This sentiment was echoed in a prepared statement from Susanne Guyer, Verizon’s senior vice president of federal regulatory matters. "The FCC took a positive step today in making it clear that voice over the Internet services are inherently interstate in nature," Guyer said. "Verizon strongly agrees that the FCC should move forward quickly to apply a light touch in regulating true voice over the Internet services and should not burden this new technology with the same economic regulations that apply to the traditional phone network, although other forms of obligations (including CALEA, E911, and universal service) should continue to apply."