NCTA: Cable won’t get in Vonage’s way

Voice-over-IP provider Vonage will not be stopped by the cable industry from providing its phone service, even though it competes directly with many cable operators in this emerging market, according to Robert Sachs, president and CEO of the National Cable & Telecommunications Association.

This policy is a reflection of the "network neutrality" philosophy adopted by the cable industry that allows broadband users to access any Web site and use any DOCSIS-approved equipment, Sachs said during a news conference Thursday. For a cable company to strip out voice bits of a Vonage transmission would represent a departure from this philosophy, and the industry has "no intention" to do that, he said.

"It would be inconsistent, whether it’s Vonage or some other user, that that should somehow be disallowed if a customer of ours wishes to use that service to enhance their broadband experience," Sachs said.

But cable companies are not going to let Vonage be the only VoIP provider over cable broadband connections. Calling VoIP the "most exciting market development this year," Sachs mentioned that Time Warner, Cablevision and Cox have all rolled out VoIP services and are expected to expand those offerings dramatically during 2004.

"We have every expectation that cable is going to emerge as a very significant competitive phone provider," Sachs said.

In fact, Sachs said NCTA’s top regulatory priority is to have the FCC establish a "deregulatory framework" for VoIP.

One of the big issues among regulators is that VoIP providers are not subject to paying into the universal service fund that helps financially ensure that all Americans have access to affordable phone service. However, Sachs said he knows Time Warner and Cox are contributing to the universal service fund from revenue generated by their VoIP offerings and that Cox and Comcast have always paid into the fund from their circuit-switched phone services.