VoIP PROVIDERS CREATE COALITION TO PREEMPT REGULATION

“The FCC should use the current NPRM to declare once and for all VoIP as an information service,” ITXC Chmn. Tom Evslin said in a conference call with reporters. He said the Commission should “assert its federal jurisdiction so that there wouldn’t be a tangle of conflicting state regulations.” He also urged the Commission to “continue to apply a very light regulatory touch for all Internet services.” Acknowledging that the FCC and states should play “a legitimate role” in addressing some social policy issues, the coalition backed a “hands off the Internet” approach, arguing such concerns could be addressed without imposing legacy regulation on VoIP.

The group said it would be a “mistake” to regulate phone-to-phone VoIP “even if it were possible, and it is, in fact, impossible, to define today what is a phone.” It said “it is phone-to-phone traffic which has funded and continues to fund the buildout of a worldwide network of interfaces between the PSTN and the Internet around the world. These interfaces are necessary so that VoIP phone and voice PBXes can connect with the TDM world and vice versa.” AT&T said the “first step” for regulators must be to “take a stand against burdening VoIP with legacy telecom access charge regime.”

Evslin said the current Universal Service Fund (USF) contribution and “broken” access charge regimes shouldn’t be extended to VoIP, but instead should be fixed. “Then, when they are fixed, they should be applied to everyone in a technology neutral way,” he said: “VoIP providers are not asking for a free ride, [but] just to be able to compete without being saddled with an inappropriate regulation.” Evslin urged regulators to “avoid imposing above-cost access fees to any type of Internet application, including any form of VoIP,” which he said would “drive up costs to consumers, stall innovation and slow VoIP adoption -- but without any economic justification.”

The coalition said it favored taking a new look at the USF. It said sustaining USF should be ensured through a system of fair contributions from all providers of telephone number-based communications services. “We believe VoIP providers should be contributing; we are not asking for any exemption,” Evslin said. The group also said it supported “an overhaul of the outmoded” intercarrier compensation regime, which it said was “now a hodgepodge of implicit subsidies.”

Evslin said technical challenges such as integrating 911 service with VoIP technology were being addressed voluntarily by the industry, in coordination with public safety and security officials. “There are important differences between the provision of 911 for traditional PSTN traffic and for VoIP, but there is every reason to expect that technical solutions exist to provide users with reliable access to public safety services,” the group said in principles published on its Web site -- www.vonplus.org. “We can provide much better emergency services using VoIP than we did with the PSTN,” Evslin said.

On CALEA compliance, the coalition said packet-based technology posed “unique technical issues, but manufacturers and providers of VoIP are moving ahead to implement compliance with capabilities in to their systems.” It also said there was “no need” to define VoIP as a telecom service for Communications Act purposes to make VoIP manufacturers and service providers cooperate with law enforcement.

Coalition principles are “fully consistent with the kinds of things state regulators have cared about historically,” said Dave Svanda, former Mich. PSC comr. and NARUC pres. “They touch on the important matters of ensuring quality product, but also consistent with state regulators’ very practical outlook about how regulation occurs.” He said state regulators “focus on the economic needs and the economic realities of citizens in their states. Being in touch with those realities and needs, they focus a lot on how their decisions affect the economy in their states and regions.” He said the VON Coalition “understands how states think about that issue.”

The group said it planned a set of outreach initiatives to federal and state regulators. MCI Dir.-Federal Law & Policy Rick Whitt said the coalition’s objectives were education and policy promotion. He said the coalition would: (1) Engage in direct outreach to policy-makers at the state and federal level. (2) Work with public safety and security officials on new policy solutions. (3) Participate in proceedings and debates throughout the country. Whitt said the group would participate in current FCC and state proceedings, including those on CALEA and Vonage preemption petition.