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Monday, December 1, 2003

VoIP, The FCC and NARUC.
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VoIP is the word - or telecom acronym - of the day. This morning Chairman Powell introduced a forum at the Federal Communications Commission on Voice over Internet Protocol. You may have seen the Washington Post story over the weekend or seen blog postings by Lynne Kiesling or Tyler Cowen on the issue. (Kiesling and Cowen are both members of our IRLE Academic Advisory Board.)

While the Commissioners' opening remarks are not indicative of a final policy outcome, they are interesting. Chairman Powell was the most clear in stating his predilections. Statements from Commissioners Adelstein and Copps are also available on the FCC site and while there are substantial differences between the men, they both generally (and favorably) raise the issue of economic regulation for the sake of social (universal service, public safety, and access to persons with disabilities) ends.

Right out of the starting gate, Powell says "I believe that IP-based services such as VOIP should evolve in a regulation-free zone." He continued with "...the recognition that the Internet is inherently a global network that does not acknowledge narrow, artificial boundaries" before addressing the very real issues that arise from the traditional police powers of state governments. Two state leaders - the established former president and current California PUC Commissioner Carl Wood and an up-and-comer from the Florida PSC Chuck Davidson - attended today's session.

As promised earlier in this space, herewith we can address the recent resolution passed by NARUC on information services. The resolution seeks technological neutrality. So far, so good. It goes on to "urge the FCC to carefully consider" a laundry list of issues from the practical, public safety and emergency services dialing, to the totally self-serving like "disruption of traditional balance between federal and State jurisdictional cost separations". One step further, NARUC resolved that "State and federal regulators should work together". It seems that today the Commission is hitting three for three. Yet, somehow, my hunch is that the official voice of the state regulatory community will cry foul if and when the Commission determines that VoIP should not be saddled with extensive utility regulation.

The real issue is not over the size of the sandbox controlled by state or federal regulators. It is not even the linguistic and legal wrangling over information and telecommunications services and whether Title I or Title II regulations reign supreme. At issue, are consumers' conveniences and choices. I agree with much of Tyler Cowen's conclusion on this point. "Competition will become more intense, calling will continue to become cheaper," and long-run financing will challenge network owners. Unless regulators find a public interest in choking off these consumer benefits.

posted by @ 5:25 PM | General

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