HOT POTATO

Congressman Chip Pickering (R-Miss.) got 61 of his colleagues to join him in endorsing a letter to FCC Chairman Michael Powell urging Powell to take charge of voice-over-IP regulation before the states screw it all up. The letter didn't use those terms, of course, it merely — but strongly — urged Powell to declare VoIP an interstate service, which would put regulatory control directly in the FCC's hands, protecting it from a potential 50-state free-for-all of regulatory oversight.

This seems like just what the doctor ordered for proponents of regulation-free IP telephony because Powell himself has espoused a hands-off approach to the fledgling technology. But in the long run, this just postpones any real decision-making. And that's bad for business. Powell won't be chairman forever (or maybe for very long), and this determination and others regarding VoIP must become law if the entrepreneurs who are driving this market are to survive and others who are waiting in the wings for their chance can be confident in its regulatory structure.

The letter was great; it's message encouraging. But it's not enough. A declaratory ruling by the FCC is not law. It will be challenged again and again and again. The uncertainty this perpetuates will keep some innovators and investors on the sideline — or now that baseball has come back to Washington, we can say it will keep them in the dugout.

Perhaps Pickering and other legislators are just being honest about the interminable timetable for working through Congress' processes and see this as the most expedient way to protect VoIP. But one has to wonder if it's the process stalling comprehensive legislation or the election-year politics keeping legislators from making any bold moves that just might cut into the tax base of their cohorts back home.

People go to Congress, ideally, with the intent to affect change. Passing the buck to the FCC because it can't get “a more comprehensive VoIP bill to work its way through the legislative process” fast enough, is not affecting change, it's avoiding it. And it just may be avoiding it in deference to fellow legislators in their home states who appear more interested in maintaining their tax revenue than in fostering the competitive environment they have been charged with creating and the consumers they are charged with protecting.

Besides ensuring the support of emergency services, homeland security-related compliance and keeping a casual eye out for anti-trust violations, state regulators should be working to make themselves as obsolete as possible by deregulating the industry as much as possible, not in forcing new competitive services into the old regulatory mold. Regulation is supposed to be a means to an end, which is a healthy competition among providers that results in low-cost quality service for consumers and the enterprise. Unregulated VoIP can bring about that end. But it must become the law, not the rule.