VoIP regulation controversy heats up

The telecommunications industry is struggling to figure out whether IP phone calls should be regulated. And if so, how much should they be regulated? And who should regulate them – the state public utility commissions or the Federal Communications Commission?

The FCC opened a public forum late last year about how or if to regulate Internet phone calls. It intends to soon issue a notice of proposed rulemaking that should result in a new set of regulations later this year.

At issue for those of us on the user side, of course, is whether the forthcoming FCC policy will help or hinder competition.

Recent regulatory activity and discussions center around whether newer broadband and VoIP network elements in incumbent local-exchange carrier (ILEC) networks fall under the Telecom Act of 1996’s Unbundled Network Element-Platform (UNE-P) rules.

UNE-Ps mandate that ILECs lease certain network facilities at deep discounts to competitive carriers. This theoretically enables new competitors to accumulate a customer base in a particular market before having to deploy their own facilities.

However, the delivery of VoIP services can straddle both the regulated legacy PSTN and newer, unregulated Internet infrastructures. So the question of the day is whether VoIP should be a regulated and even taxed service or an Internet service (and thus unregulated) or something in between.

For his part, AT&T Chairman David Dorman last week told an independent industry public-policy consortium that for VoIP to succeed, UNE-P must remain intact, implying that all facilities involved in the delivery of VoIP should be regulation-free. Addressing the New America Foundation, he asserted, “UNE-P is the stepping stone to a VoIP future” and urged regulators to permit the successes of the current competitive environment to continue.

“We must recognize that UNE-P is an essential bridge to next-generation technologies and to lasting competition,” Dorman said.