WASHINGTON -- The Federal Communications Commission (FCC) voted unanimously Thursday to initiate a rule-making procedure that says Voice over Internet Protocol (VoIP) technologies should remain largely free of regulatory burdens.
But they also noted that Internet telephony companies do have obligations to public safety and law enforcement agencies.
The FCC commissioners said the vote was designed to "provide a measure of regulatory stability" to the communications marketplace and to further promote the development of VoIP services.
In connection with the year-long proceedings, the FCC also announced it will initiate a separate rule-making procedure this spring to address law enforcement concerns that VoIP is not wiretap-friendly. In addition, the FCC's Internet Policy Working Group will host a March 18 "Solutions Summit" to discuss "creative ways" to focus on 911 location issues associated with VoIP.
"You are going to see the FCC moving simultaneously on a very broad VoIP front," Bill Maher of the FCC's Wireline Competition Bureau said.
In a separate, but related, decision, the FCC ruled, 4-1, that VoIP pioneer Jeff Pulver's Free World Dialup (FWD) business does not meet the definition of a telecommunications service and is free from FCC regulations. Pulver's VoIP venture requires members to buy special equipment and have a broadband connection to talk with each other computer-to-computer. Beyond the equipment, there are no fees and the free calls are routed entirely over the Internet.
"Like e-mail and instant messaging, FWD builds on consumer acceptance of those services and operates as a free, peer-to-peer application that connects consumers around the corner and across the globe," FCC Chairman Michael Powell said. "Our ruling formalizes the Commission's policy of 'non-regulation' of the Internet and, in doing so, preserves the Internet as a free and open platform for innovation."
Commissioner Michael J. Copps cast the lone vote against Pulver.
"In this order, we look before we leap. The Commission declares that Free World Dialup is an information service but does not address any of the consequences of its decision," Copps said. "This headlong jump presents stark challenges for law enforcement and has implications for universal service, public safety and state and federal relationships that we have yet to untangle or assess."
Unlike Pulver's FWD, most VoIP providers route calls from leased local telephone lines to a gateway server that converts analog voice into data packets. From there, the data packets move over the public Internet or a private backbone to its destination, where it goes through another gateway, rolling over to a local line. While VoIP is clearly a phone service, providers say they shouldn't be regulated in the same manner as publicly-switched traditional telephone carriers since they don't traffic in voice packets.
As the major telecoms and cable companies join startup VoIP ventures in moving voice-converted data traffic over the Internet, the issue becomes critical for cash-starved states that raise hundreds of millions of dollars in telecom fees and taxes based on the FCC's traditional regulatory model for telecoms. Most of those rules were written decades ago to reflect the government's interest on behalf of the public in the monopoly granted to the Bell systems.
In disagreeing with Copps, the other FCC commissioners said public safety and law enforcement concerns will be dealt with in the larger rule-making procedure.
"While IP-enabled services should remain free from traditional monopoly regulation, rules designed to ensure law enforcement access, universal service, disability access and emergency 911 service can and should be preserved in the new architecture," Powell said. "In today's [proposed rules], we seek comment on whether and how to apply discreet regulatory requirements to fulfill important federal policy objectives."
Powell added that law enforcement access to VoIP services is "essential." The Communications Assistance for Law Enforcement Act (CALEA) requires telephony services defined as telecommunications carriers under the 1996 Telecommunications Act ensure that their equipment is capable of providing surveillance capabilities to law enforcement agencies.
"CALEA requirements can and should apply to VoIP and other IP-enabled service providers, even if these services are 'information services' for the purposes of the Communication Act," Powell said. "Nothing in today's proceeding should be read to suggest that law enforcement agencies should not have the access to communications infrastructure they need to protect our nation."
The FCC's Maher said it will be several weeks before the actual proposed rules will be published.