* Vonage’s fees; FCC Chairman Powell on regulations
Last time, we compared taxes and fees assessed on MCI and Cox Communications phone bills. Today, we’ll look at what Vonage adds, and what FCC Chairman Michael Powell has to say about Internet telephony taxes and regulation.
Last time, we compared taxes and fees assessed on MCI and Cox Communications phone bills. Today, we’ll look at what Vonage adds, and what FCC Chairman Michael Powell has to say about Internet telephony taxes and regulation.
Vonage has a $24.95 basic plan that includes unlimited local and North American long distance; the plan also includes standard custom calling features and voice mail. Unlike with MCI and Cox, the Vonage list of added fees is short.
Since Vonage is providing an application on the Internet, it has thus far avoided regulatory requirements for most of the taxes and surcharges traditional service providers collect. Therefore, Vonage only adds a 3% federal excise and a $1.50 regulatory recovery fee to its standard service. New Jersey residents are also required to pay a 6% sales tax since Vonage is based in New Jersey.
Some states and federal officials would like to add charges and further regulate IP telephony (IPT) service providers. However, Powell is on the side of less tax and less regulation for IPT.
In a speech at the Fall VON 2004 trade show, Powell noted “how important it is for government to nurture the Internet as a platform for innovation and entrepreneurial activity.”
He continued: “It’s wrong, just plain wrong, to not recognize the potential of VoIP, or to see it through the lens of the old telephone network regulatory model. VoIP is a data application and as such has all the hallmarks of the Internet itself.”
He added that “to hold that packets flying across national and indeed international digital networks should be subject to state commission economic regulatory authority is to dumb down the Internet to match the limited vision of government officials. That would be a tragedy. I look forward to working with my… colleagues to ensure that a minimal, well-harmonized regulatory environment is applied to VoIP services.”
While regulatory questions like lawful wiretaps and E-911 support are still up for discussion and decisions, it looks like IPT has a powerful ally to avoid the substantial taxes and surcharges many states would like to add to your phone bill.
Next time, we’ll take a look at some interesting trials that bring wireless and wireline network services together.
