FCC says VoIP not subject to State regs

jwt

Given that our own tend to follow FCC rulings as a guide the following may be of interest

(Mods, feel free to move if considered not relevant)

The Federal Communications Commission declared today VoIP services similar to Vonage's DigitalVoice service are not subject to traditional state public utility regulation.

Although the order—which was approved by Chairman Powell, Commissioners Abernathy, and Martin, with Commissioners Copps and Adelstein only "concurring"—was good news for Vonage and other VoIP companies, it does not signal an entirely clear track ahead for VoIP to be free of government regulation.

The decision only clarifies that the FCC, rather than state commissions, has the responsibility and obligation to decide whether certain regulations apply to IP-enabled services. The ruling also means that the FCC has the power to preempt state regulations that thwart or impede federal authority over interstate communications.

The ruling was the result of a petition from Vonage seeking federal preemption of an order by the Minnesota Public Utilities Commission in August of 2003 that concluded that Vonage's DigitalVoice was a telephone service for which Vonage was required to obtain a certificate of authority and meet other rules and regulations governing telephone companies in the state.

The Commission also found that regulations that would have been imposed by the Minnesota Commission were inconsistent with the FCC's deregulatory policies, and that preemption was consistent with federal law and policies intended to promote the continued development of the Internet, broadband and interactive services. Although the FCC found that the Minnesota requirements must yield to the extent they bar entry, the Commission said the ruling does not signal that Vonage may cease its efforts to develop workable solutions.

Issues not addressed by the FCC's order include the applicability to Vonage of general laws in Minnesota governing taxation, fraud, commercial dealings, marketing, advertising and other business practices and the FCC's statement said it "expects states to continue playing a vital role in protecting consumers from fraud, responding to complaints, and enforcing fair business practices".

Also not addressed is whether Vonage's DigitalVoice service should be classified as an unregulated "information service" under the Communications Act or a telecommunications service and whether VoIP providers must provide access to the disabled, pay intercarrier compensation and contribute to the universal service fund. These issues will be addressed in the Commission's ongoing IP-Enabled Services Proceeding.

John