Q & A: CPUC's Susan Kennedy On VoIP

As regulatory issues take center stage in the Voice over IP arena, the spotlight is sure to shine a bit on Susan Kennedy, a commissioner with the California Public Utilities Commission (CPUC). While the CPUC earned notoriety in some VoIP circles for its letters last October requiring VoIP providers to register as telecommunication carriers, it has since taken a step back, deciding to study the issue more closely before making any official judgements.

While some CPUC commissioners still say some regulation is necessary, Kennedy herself leans toward less regulation, and says VoIP shouldn't be shoehorned into existing regulatory boxes. Instead, she says VoIP should be addressed by new, national broadband policies that would promote business while also protecting consumers.

A Democrat who has held senior staff roles for both former California Gov. Gray Davis and Sen. Dianne Feinstein (D-Calif.), Kennedy was named in December to the FCC's Federal-State Joint Conference on Advanced Telecommunications Services, an advisory group to the FCC.

Though commissioner Kennedy wasn't available for an in-person interview, she did agree to respond via her staff to a list of e-mail questions, which follow:

Networking Pipeline: Is it necessary for the states and the FCC to be on the same page when it comes to matters like VoIP?Susan Kennedy: The FCC's action on VoIP was a critical step. The message to state regulators was clear: Do not attempt to contort existing regulations to fit this new technology.

Some commissioners, both state and federal, expressed concern that the FCC was stepping in prematurely, acting before fully understanding the implications of VoIP on a host of public policy issues.

But in my view, the FCC acted not one minute too soon, and in doing so, prevented states from digging in with efforts to somehow trap this new technology in one of the existing regulatory boxes.

Networking Pipeline: California had considered regulating VoIP, then seemed to be leaning the other way, and now seems ready to regulate again. Why the switches?

Kennedy: The primal instinct of most regulators is to preserve their jurisdiction, and the pull of that instinct is so strong that it often acts like blinders -- impeding their ability to see anything that is off the path of achieving that goal.A powerful example of this is the position the CPUC staff took on VoIP. California was one of the first states to declare VoIP a telecommunications service under the law. The CPUC staff came to that conclusion without the benefit of a single policy discussion or hearing on the issue. They acted quickly to preserve jurisdiction.

On Feb. 11, the Commission voted to take a more careful look at the issue. An Order Instituting Investigation was opened, and both Commissioner Brown and I are currently serving as Assigned Commissioners. We are responsible for moving the investigation forward, and will bring the findings of the investigation before the full Commission for review later this year.

Networking Pipeline: Is there a middle ground where VoIP providers pay some costs for universal access and intercarrier compensation and how likely are all the players to agree anytime soon?

Kennedy: Here's one idea that might work for the foreseeable future:

Designate any voice service that makes use of North American Numbering Plan resources as a primary voice communication medium. All primary voice communication as such would be subject to 911 requirements, CALEA, and pay into the universal service fund on a per number basis.It is my hope that the VoIP proceeding initiated by the California Commission will open up a dialogue about what that future should look like.

Networking Pipeline: VoIP vendors are complaining that if states regulate the service, they will have to spend money complying with a host of different rules, instead of just one national set of guidelines. Why does California need (or not need) its own regulations regarding VoIP?

Kennedy: The goal of the Commission's VoIP investigation is to answer that very question. I do believe strongly that regulatory consistency is important -- not only is consistency necessary for both consumers and market players to be treated fairly, but it also provides the environment necessary for investment to occur. Consistency in a regulatory approach is important not just within a state, but among various states, if a company is to make investments in its national infrastructure.

Networking Pipeline: Can corporations be secure in implementing VoIP, or should they hold off (or expect to pay more in the future)?

Kennedy: I firmly believe that VoIP is going to change everything about the way we communicate with one another. However, there are always both risks and advantages to being an early adopter of new technology, and each company is going to make its own decision about what to do.Networking Pipeline: Can California afford to adopt more policies (like VoIP fees or taxes) that might make the state seem even more anti-business?

Kennedy: I am very committed to ensuring that California and its citizens enjoy the benefits of a vibrant, healthy economy. I also take my responsibility to protect California consumers very seriously, and I feel that this can best be accomplished by a regulatory approach that is fair, balanced and consistent. Our regulations must protect consumers and the rights of all Californians to good jobs and a strong economy.

Networking Pipeline: Can you briefly describe your role on the FCC commission, and what you hope to achieve there?

Kennedy: The FCC's Federal-State Joint Conference on Advanced Telecommunications Services consists of 10 state commission and FCC members, and was instituted in 1999 as part of the FCC's efforts to ensure that advanced services are deployed as rapidly as possible to all Americans. The Joint Conference is responsible for collecting data on deployment of advanced services and for fostering dialogue among the FCC, state regulators, and policymakers at the local, state and national level as to how best accelerate the deployment of advanced telecommunication services.

I look forward to working with my colleagues on the Joint Conference to make advanced telecommunications services more accessible to all Californians and all Americans -- and especially those in hard-to-reach communities, such as certain ethnic populations and those in rural areas.0