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California PUC Calls For A Public Hearing On VoIP

Vick points to this story at Voxilla.com, which says that "A California Public Utilities Commissioner has called for public hearings on the agency's recent demand that Voice over IP service providers apply and be certified as full-fledged telephone companies." The anti-regulation arguments, though, mostly seem to hinge on timing and protocol -- I wish more objectors would argue that there are already too many phone regulations, instead of seeming to promise a boatload more captured users (dollars) if we just let VoIP develop for a few years before unchaining the regulators.

13 of 114 comments (clear)

  1. VoIP doesn't manage physical wires by crow · · Score: 4, Insightful

    The big difference between VoIP companies like Vonage and the traditional phone companies is that Vonage doesn't manage any physical connection to its customers. The implications of that one fact are huge.

    First, it means they aren't a natural monopoly. Anyone can start a similar business without investing millions of dollars in each community. The regulatory approach to a non-monopoly should be completely different.

    Second, it means that taxes based on physical connections aren't appropriate. Vonage shouldn't charge for the Universal Connectivity Fund. Granted, there may be good reason to create a Universal Broadband Fund, but that would be based on charges levied by the ISPs, not by secondary service providers.

    1. Re:VoIP doesn't manage physical wires by st0ner1 · · Score: 2, Insightful

      Unfortunate eh, Where I live the people that live in the rural areas are the ones that can afford the 2 million plus ranchete. Its not clear that I need to be subsidizing these folk. In any case I am prepared to pay the fair marked value for the services I recieve and those that choose to live in rural areas should do the same. Food isnt cheaper in the sticks its more because of increased distribution costs. Why should phone services be any different.

    2. Re:VoIP doesn't manage physical wires by Dun+Malg · · Score: 2, Insightful
      Let's go over this again. Cellular providers don't have a natural monopoly, but they are regulated. CLECs, who don't have a natural monopoly, are regulated.

      Sorry, try again. Federal law says states can't set prices or erect barriers to companies entering or exiting the mobile telephone marketplace. Cellular service is regulated a bit by the FCC, but unlike the copper-loop-providers, the state PUC's can't touch 'em. States have the usual power to regulate the terms and conditions of service contracts, but that's true for ANY industry.

      Are you arguing that only ILECs deserve to be regulated (because of their monopoly)?

      I would argue that YES, the monopoly providers of the last-mile copper should be regulated, as there is no competition. That is, in fact, the entire justification behind PUCs regulating ILECs.

      Or are you arguing that VoIP is somehow special?

      I would say that VoIP is more like cellular service than POTS. It's not dependent on a single provider of a physical medium for delivery. Internet connectivity is available from numerous competing providers, therefore the only valid justification for PUC oversight (monopoly provider) is not present.

      --
      If a job's not worth doing, it's not worth doing right.
    3. Re:VoIP doesn't manage physical wires by silentbozo · · Score: 3, Insightful

      You seem to be ignoring something. If you subscribe to dedicated DSL you're already paying USF on the copper pair going to your house. If I'm going to get VOIP over those copper wires, why should I pay USF twice?

      Think about it. Your argument could easily be applied to wireless - if you let everyone use 802.11b, they should have to pay USF because they might concievably drive established carriers out of business, thus driving down the amount available to fund phone service for schools, libraries, rural and disadvantaged residents, etc.

      I'd rather use these new technologies to provide cost-effective service to everybody, rather than taxing it (and there by limiting its competitiveness) just because an established monopoly is a source of cheap revenue.

  2. Just use end to end VoIP by Skapare · · Score: 4, Insightful

    Once there is enough high speed IP deployed, we can bypass the traditional voice phone network entirely, and run voice over encrypted end to end IP connections. Imagine "dialing" in the form of domain names. The only reason the regulators are getting into this is because VoIP services are interfacing with the existing voice network. More work needs to be done to phase that voice network out of existance (which will be a long slow thing).

    --
    now we need to go OSS in diesel cars
  3. Purpose of regulation irrelevant to VoIP by Texas+Rose+on+Lava+L · · Score: 3, Insightful

    The whole reason why telephone providers are so closely regulated by the government is that the market for land lines is a natural monopoly - that is, competition is impossible because a competitor would have to install a redundant network, which is prohibitively expensive. So, since monopoly is inevitable, the government regulates it to ensure the providers don't take unfair advantage of the monopoly.

    With VoIP, there is no monopoly. There can be dozens of different VoIP providers just as there's dozens (ok thousands) of pr0n sites or dozens of online bookstores.

    When we have a new technology, why don't we rethink the way we regulate things instead of just applying the old regulations to the new technology regardless of whether or not it makes sense to do so?

    1. Re:Purpose of regulation irrelevant to VoIP by Skapare · · Score: 2, Insightful

      The breakup of AT&T back in the 1980's was done all wrong. They broke things between local phone service and long distance service. The whole thing came about because of competition in long distance. Now we have competition in local calling, plus internet and VoIP. The one thing that remains a monopoly is the physical infrastructure. Had the breakup been done so that one well-regulated company owns and manages the physical infrastructure, and all the rest get to complete (with regulation gradually stepping in as monopolies emerge, to provide a resistance to that), then we wouldn't have all this fuss over so many regulatory and competitive issues as we have now. The one thing is that the company that owns the physical infrastructure has to stay out of the other markets (this isn't a business for the greedy), and needs to have capitalization to keep the infrastructure up to date with technological changes. What we really need right now is a "fiber everywhere" infrastructure that can carry everything. We could move to the model of having the one regulated infrastructure monopoly by creating it to build that fiber infrastucture, and phase out the existing infrastucture.

      --
      now we need to go OSS in diesel cars
  4. This is double dipping by cpuffer_hammer · · Score: 3, Insightful

    You pay your telephony/data tax/fee when you pay your ISP, you should not have to pay again when you use send one kind of bit/byte as apposed to a different kind of bit/byte.
    If you do have to pay then you should be able to subtract the amount from the tax/fee you pay though your ISP.

    Now the moment one of these DSL providers starts connecting lines to peoples houses or other locations then they are a Telco and should act like one.

    I think this is more like a regulatory barrier to entry into voice communications or protectionism for the existing Telco.

  5. Wrong question by Borealis · · Score: 2, Insightful

    I think the question should be "how on earth are they going to regulate it", not when. VOIP is just data on the network. How long until there's an open source VOIP solution widely adopted without centralized control?

    It isn't going to be possible to regulate it without extensive packet monitoring.

    --
    Unbreakable toys can be used to break other toys.
  6. Re:how easy to track? by kfg · · Score: 2, Insightful

    Impossible to track. A packet is a packet.

    It's all handled in software too. Calling Roger Wilco or PalTalk "phone services" stretches the definition to the snapping point. For strict peer to peer I could write software myself so regulating the software is pointless to even try. I know tons of teenagers who could do it as well. It isn't rocket science. It isn't even computer science.

    And then what do you call an email with an .ogg file attached?

    Regulationg computer to computer voice transmission over IP makes no more logical, or legal, sense than regulating two tin cans and a piece of string.

    I own my tin can. Granny owns hers. If granny lives across the country we lease rights to the string already. If she lives across the hall we even own the bloody string.

    KFG

  7. Re:Consittutional Rights?? by Lord+MJ · · Score: 2, Insightful

    This is incorrect. People don't have the right to form corporations, that's a privaledge that is granted by the government. In exchange for the benefits of operating as a corporation (as opposed to a partnership) the corporation has to submit to any restrictions that the government imposes.

  8. Re:I don't get it--can someone explain VOIP to me? by Wesley+Felter · · Score: 3, Insightful

    Can someone please tell me why we are looking to a centralised (and billable, taxable) VOIP strategy, instead of a direct peered (or even client/server) model?

    So that you get a real phone number that anyone can call.

  9. Re:Can't undercut by bypassing regulations by Anonymous Coward · · Score: 3, Insightful

    OK, first of all, they aren't the ILECs' interfaces, or at least, in a sane world they *shouldn't be*... they were paid for by money that resulted from a government granted monopoly... later the infrastructure "ownership" went to the RBOCs, although some of us thought at the time that it would make sense to take it away from the "Baby Bells", put it into the hands of non-profit organizations dedicated solely to its maintenance and enhancement and force them to truly compete in the arena of services.

    That didn't happen, of course - too much money was at stake, and too many politicians' palms were greased at the state and federal level to ensure that it wouldn't happen.

    The Telecommunications Reform act of 1996 was supposed to open up the POTs lines to ILECs, with an eye towards fostering competition. In return, the RBOCs would be allowed to offer long distance services again.

    Again, it didn't happen, not really... ILECs came and went, and the few that have survived have done so only in high population density areas, although I note that Verizon and other RBOCs are now allowed to offer long distance services despite their at best begrudging compliance with the law.

    Cynically, I think that the only reason the California state PUC is getting involved is because the RBOC wants eliminate any competition, and if they start now while the services are small, they can either strangle them at will, or keep them under control and stomp on them at their leisure later.

    There's enough bandwidth now with cable modem and DSL, and enough availability, to make a serious dent in all of the RBOCs' local service cash flow numbers in ony a few yeats if services such as Vonage catch on.

    And as for your statements about 911 services and the USF, all the companies pass that cost on to the customer base, so I fail to see what your point is in that regard - it doesn't cost the RBOCs anything.