S. 2281 GOES TOO FAR
VoIP Bill Goes Beyond What Departments of Defense, Justice and Homeland
as well as Consumer Groups or Even Industry Seek
June 16, 2004
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Local government looks forward to the future made possible and
benefits to capture with IP enabled services. S. 2281, however,
goes beyond that which is necessary to promote VoIP and could jeopardize
the future of universal service, E911, national security and the
viability of service to many rural and inner city areas. As reflected
in recent filings at the FCC [IP Enabled Services docket, FCC 04-36],
the Department of Defense, Department of Justice (“DOJ”),
Department of Homeland Security (“DHS”), consumer groups
and many communications providers, S. 2281 goes too far.
Below is a list of the major components of S 2281 and excerpts from
the various filings at the FCC, which reflect that the bill goes
S. 2281 GOES BEYOND INDUSTRY NEEDS IN ESTABLISHING EXCLUSIVE
S 2281 (Section 2) would reserve and severely limit jurisdiction
over VoIP to the Federal Communications Commission. DOJ, DHS, state
and local government commenters disagree with such an approach.
To the contrary all agree that there must continue to be regulatory
interactions by federal, state and local government with VoIP providers.
Absent such authority, VoIP providers’ compliance with the
goals of national security/emergency preparedness (NS/EP), CALEA
and E911, ADA are jeopardized.
- DHS states at p.8: “In times of emergency and network
congestion, NS/EP priority treatment may be required for certain
communications such as electronic mail, instant messaging and
video conferencing. The Commission’s rulemaking process
must keep this in mind.”
More than just government seeks to retain oversight of VoIP at
the state level. Cable MSOs, ILECs and their national associations,
while calling for state preemption for economic regulation, nevertheless
call for state public utility commission oversight and authority
to protect universal service, enforce inter-carrier compensation,
enforce interconnection rights, preserve access to the North American
Numbering Plan assets and E911 resources.
- See e.g. Cox Communications at p. 13 calls upon the Commission
to adopt a framework that includes speedy enforcement and dispute
resolution at the state level for VoIP providers’ interconnection
needs. See also Attachment A to Comcast’s filing and the
“VoIP White Paper” of the National Cable & Telecommunications
Association, Balancing Responsibilities and Rights: A Regulatory
Model for Facilities-Based VoIP Competition (Feb. 2004)
It is not just government and incumbents that want the continued
role of local government. Parties that one would expect to be served
by S. 2281 also call for a continued role of state government. Facility
and non-facility based providers call on the Commission (and Congress
by extension) to enforce a Title II common carrier regime enforced
at the state level to regulate the underlying transport platforms.
The industry’s desires could not be met under the S 2281.
- AT&T at p. 9 states: “The Act…does not permit
the elimination of core obligations that apply to basic telecommunications
services because they simply employ Internet Protocol (IP).”
Not surprisingly the National Consumers League calls for preserving
the role of states in VoIP.
S. 2281 IS OVERLY SEVERE IN ITS LIMITING FCC OVERSIGHT.
S. 2281 (Section 3) severely limits authority of the FCC to manage
VoIP and VoIP providers. In doing so the bill goes too far and creates
a regulatory regime that has no basis in legal precedence, experience
or vision of a world in which facility providers are fairly compensated
for the use of their facilities and subject to asymmetric regulations.
- BellSouth at p. 47 cites the Commission to Cincinnati Bell Tel.
Co v. FCC 69 F 3d 752 (6th Cir. 1995) for the proposition that
Courts have found the Commission has an obligation to regulate
like services in a like manner. The Sununu legislation would jeopardize
the Commission’s ability to meet this standard.
- “Comcast also urges the Commission to avoid disproportionately
burdening those VoIP providers that are facilities-based in favor
of those that are not.” Comcast at 17.
Ban on Access Charges
Section 4 of S. 2281 bans access charges on inter-carrier compensation
unless such compensation is limited to reciprocal obligations. The
industry does not agree. Cable MSOs, Wireless Carriers and ILECs,
both rural and urban, have made clear to the Commission that they
should be entitled to fair compensation for the use of their networks.
Such reciprocal compensation is not attainable under S. 2281.
The result is that existing networks become stranded assets financially,
despite being integral platforms for service.
- OPASTCO said the use of IP technology does not reduce an ILEC’s
cost of providing access to the network, so VoIP services “should
provide equitable compensation.”
- The Ad-Hoc Telecommunications Users Committee at p. 12 called
upon the Commission to adopt a unified intercarrier compensation
regime to include VoIP providers.
- BellSouth at p. 43 calls upon the FCC to establish a regulatory
structure that requires all VoIP providers that integrate with
the PSTN to contribute to universal service, Intercarrier compensation,
CALEA, and E911. No such requirements would be possible under
Universal Service Exclusion
S. 2281 creates an exemption for contributing to universal service.
While a couple of non-facility VoIP providers filed comments at
the Commission seeking exemption from universal service, not a single
federal, state or local government party supported any such exemption.
Likewise every Cable MSO and ILEC supported the requirement that
VoIP providers pay into the USF. Even major VoIP providers such
as AT&T and Vonage did not oppose the imposition of a USF contribution,
although they did suggested that such continuation might be delayed.
- BellSouth at p. 48-49 asserts that all IP providers must contribute
to universal services as an information service contains a telecommunications
- Level 3 calls upon the Commission at p. 3 to create a world
in which IP enabled services are governed by reciprocal compensation
and contribute to the USF.
- National Consumer League said that since VoIP is a telecom service,
it should contribute to the universal service fund.
Section 4 (c) of S 2281 would establish VoIP as a CALEA free zone
ensuring its position as the criminals’ and terrorists’
telecommunications network of choice.
Government, ILEC, Cable MSOs, CLECs, CPE manufacturers and consumer
groups filing in the FCC’s IP docket agree that VoIP should
be subject to CALEA. For whom, therefore, is this section drafted?
- The Department of Justice made clear at p. 5 that the “Commission
[and Congress?] …should be mindful not to adopt a classification
scheme that could inhibit the ability of law enforcement to conduct
court-ordered surveillance of communications occurring via IP-enabled
services.” Justice further clarified that unlike S. 2281,
the Commission can not rely upon Title I only. “If the Commission
utilizes its ancillary jurisdiction under Title I to apply mandates
required by CALEA, such action could be challenged in court and
result in delays and prolonged regulatory uncertainty, which is
not in the interest of industry or of law enforcement.”
- DHS at p. 3 associates itself with the comments of Justice
- ILECs and Cable MSO agrees that CALEA should apply. See e.g.
Comments of USTA, NCTA, BellSoth, Cox, Comcast et. al.
S. 2281 would create a voluntary process for the development of
E911 capabilities compliant with the ADA, as well as reliability
and privacy standards
- Federal, state and local elected officials and law enforcement
at all levels of government filed with the Commission to make
clear that industry standards alone are not acceptable. Additionally,
ILECs and Cable MSOs have made it clear that regulation of their
services, which are subject to government oversight in each of
the identified areas, should not be more onerous than that required
of their competitors – VoIP providers.
- APCO stated the “Commission must not succumb to the temptation
to defer entirely to voluntary standards and guidelines to address
the E-911 problem.” P. 3 The National Consumer League stated
VoIP is a telecom service that should provide full E-911, provide
all consumer protections and meet all disability access mandates.
S. 2281 requires only the disclosure of the absence of 911 capabilities
Government and consumer groups alike have documented that such a
solution is not acceptable and fraught with perils for the public.
- APCO at p.8 documents how voluntary disclosure at point of sale
is just not a workable solution.” In a residential setting,
the person attempting to make the 911 call may be a child of an
injured parent or caretaker, a neighbor unfamiliar with the limitations
of the homeowner’s VoIP telephone, or even the original
purchaser who, in the heat of the emergency, forgets the 9-1-1
disclaimer that they may or may not have read when acquiring the
VoIP service. In a business setting, the VoIP/911 call is likely
to be made by an employee, contractor or customer who had no role
in selecting the non-compliant VoIP service.”
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