Cut IP Some Regulatory Slack

Don't let the telecom apparatchiks suck the vitality out of IP communications. We can serve the public good without force-fitting modern technology into decades-old regulatory structures.

February 27, 2004

3 Min Read
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So it also goes with public telephone service, a century-old cash cow that's on its last legs thanks to the economics of IP communications. Phone companies, state public-service commissions and other industry power brokers desperately want to preserve some semblance of the current system, under which revenue and taxes flow in as reliably as the tides. At risk on open-range IP networks, the defenders of tax-and-regulate telecommunications maintain, are social mandates such as public safety (911 calling), law enforcement (wiretaps), affordable rural telephony (universal service) and access for the disabled. If not the government, who will ensure that IP networks will accommodate those critical needs?

On the other side of the debate are IP-industry pioneers and their constituencies, who call for a market-driven approach that keeps surcharges and regulation to a minimum. The social mandates can be preserved, the pioneers argue, without cramming VoIP into the stifling regulatory taxonomy the Federal Communications Commission applies to basic telephony.

Fortunately for the forces of progress, the current FCC administration, led by chairman Michael Powell, is siding with the pioneers. As a start, the agency ruled this month that Free World Dialup--a members-only service that enables free Internet calls among computers that run special FWD software--isn't subject to conventional telephony regulations. Still to be decided, however, is how to handle commercial IP voice services routed over circuit-switched networks; FWD's service runs over broadband connections to the Internet.

As for how emergency calling, universal access and other social services would be provided in an IP world, the FCC has organized an industry "solutions summit" to develop discrete requirements. It appears the FCC will indeed regulate VoIP--but with precision.

Already, members of the VON Coalition, an IP communications industry group, have struck an agreement with the National Emergency Number Association to develop the technical and operational means to reach 911 services via VoIP--a sign that the private sector can aspire to public policy goals voluntarily. Private interests can be expected to tackle access for the disabled with equal vigor, since it's in their commercial interests to keep the regulators and tax collectors at bay. As for universal service, Moore's Law should take care of that challenge as VoIP technology becomes ever cheaper. Another Packet App

The IP industry's fundamental argument is that voice transported over packet-switched networks isn't the same as voice over public-switched networks. With VoIP, voice is more akin to e-mail or instant messaging--just another packet-based application that consumers and companies can get from service providers or deploy themselves. As such, exempt VoIP from heavy taxation and regulation just as e-mail, IM and other basic packet traffic are exempt.

Don't let the telecom apparatchiks suck the vitality out of IP communications in the name of helping the poor and disabled. It's an old ploy. The universal-service smoke screen, in particular, has been fumed by most national PTTs during the past two decades in an attempt to head off emerging competition. We can serve the public good without force-fitting modern technology into decades-old regulatory structures. The process just requires some modern thinking.

Rob Preston is editor in chief of Network Computing. Write to him at [email protected].

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