Will FCC Regulate Internet Phone Calls?

Ridgelift writes "The FCC will begin hearings on Monday December 1st to see if they will get involved in regulating calls placed over the internet. Since a federal court in Minnesota ruled a month ago that calls delivered over the Internet are not subject to state regulation, Qwest, Verizon and SBC have all announced their intention to deliver more calls over their data networks. "The stakes in the debate are huge. Federal and state governments could lose billions of dollars in revenue from regulatory fees if calls moved onto the Internet are no longer subject to the charges.""

Comments

What will they do?

[ryanr]

Well, let's see... the Federal Government is in charge of deciding whether to regulate it... and the Federal Government stands to lose billions in revenue if they don't regulate it...

Well, I'm sure they will do the right thing.

Re:What will they do?

[Anonymous Coward]

God Bless Taxes!

I know I should be mad, but Im only focusing on the fact that data isnt taxed (should it be?) then why should Internet Telephany be taxed?

Re:What will they do?

[silentbozo]

This is an area where the big telephone companies stand to gain, one way or another. Right now, Qwest and other Baby Bells are pushing to go to VOIP, not because they want to, but because if they don't they're going to get their lunch eaten (much as they were forced to offer DSL to try and kill off their competition.) After all, by offering VOIP, they're cannabalizing local phone service, on which they make TONS of money.

So why the big push? Well, if the Feds do nothing, they'll need to have a foot in this new market to compete, AND they can save all that money in connection costs for long distance. If the Feds regulate, then the Baby Bells are no worse off than they are now, but all the new VOIP startups get hobbled, big time.

Several commentators have basically noted that the established teleco's are playing chicken with the Feds - either regulate and put us back on top of the game, or else we'll take all our local service (and your freebie tax revenues) and put it in this new area.

Re:What will they do?

[buffer-overflowed]

Umm, long distance is way cheaper than local from a distance versus distance standpoint. Access minutes are basically to suplement the increased costs of providing and maintaining the local loop So pushing traffic off the long-distance networks and onto the local networks (through pushing VOIP and DSL) will cause the ILECs to charge more (we've already gradually seen this happen, as local phone service increases in cost, while long distance decreases in cost [over say, a decade ago]). The ILECs are in a unique position to capitalize on this, but it's not going to get over the problem of the local loop. Some people say wireless will, but I doubt that.

Re:What will they do?

[jc42]

Right. And note that, without regulation, there would never have been telephone service in many rural areas (and in some parts of some cities).

We do have a similar situation with the Internet in the US. One of the effects of the government leaving it so unregulated is that it's only available in areas where it is profitable. Most of the rural US has no Internet service, and likely never will unless some government steps in and either mandates it or provides it. In some cases, local governments are setting it up.

Part of the value of both the phone system and the Internet is in making it reach everywhere. The more territory they cover, the more valuable they are to everyone. But the Market won't do this, because there's no incentive to supply service to marginal areas.

Re:What will they do?

[BitGeek]

No, the reason they regulate it is to control it.

Where do you socialists get the idea that companies only want to sell to the rich? Haven't you noticed the dozens of cellphone companies working to drive down prices as fast as they can? Notice how poor people have cellphones now?

This is all DESPITE a crushing burden of regulation by the FCC.

The FCC only DAMAGES the economy and the pocket books of poor people. The FCC makes it more expensive for everybody, and expesially more expensive for poor people to get access to telephones. You need to read up on some basic economics.

Without the FCC (And the many decades of government created telephone monopoly) the poorest would have gotten telephones at much lower cost decades sooner.

Government is the source of-- not the solution to-- all of societies problems.

Enforcement?

[Dyolf Knip]

And just how would they enforce any such regulation? VoIP is basically just a program running over existing networks. Cell phones not withstanding, you can no more require charges to be paid than you could charge for email or instant messaging. It's just a communications protocol!

Completely Switching to VoIP

[Davak]

Thanks to some great suggestions by people previously on slashdot I have completely switched to VoIP for my phone service. It rocks.

Previously I had not switched because I was scared of losing 911 service. However, if you have wire running into your house, you can still pick up and dial 911--even without service!

So we have our emergency land-line phone--for free. Now we are using VoIP for everything else.

However, if VoIP starts getting taxes to death, then people like me will switch to something else... and then something else...

Can't the government just stay off these new industries long enough for them to get started?

Re:Does anyone actually do this?

[brianosaurus]

Maybe you don't, but your carrier might. Qwest (or whoever) could take your analog call and digitize it at the CO, route it over IP to the destination CO, then pump it back out analog. Its cheaper for them.

There are also companies like Vonage, who provide phone service over your broadband connection. Some of my friends recently dropped their landline and now use Vonage over their cablemodem. They pay a flat fee ($40 i think) for all calls, including long distance.

A question..

[KD7JZ]

Do you consider universal affordable phone service to be a social good worth paying for?

That goal of universal phone service is possible only because of the current system of regulation. Regulation is an unfortunate term. It is really a system whereby telephone subscribers in populus areas subsidize subcribers in more rural areas. Regulation allows phone providers a consistent rate of return on their capital investment while keeping rates down for everyone.

What I want to know

[mcc]

How will they track this, and how will they be able to determine if people are cheating?

OK, so they decide to regulate and tax Voice routed over IP. What about Voice routed over IP routed over some other sort of IP protocol disguised to not look like voice? What about Voice over IP routed through relays in Canada? What if two people are doing VoIP but then claiming "what, this isn't a phone conversation, we're just streaming each others talk radio streaming mp3 stations to each other."

This could become fascinating. We would wind up with this sort of caste structure being created among internet protocols, where this stream of bytes is okay and anonymous but THIS stream of bytes, the government needs to know about it and it needs to be taxed.. just because the latter set of bytes happens to contain audio data of a certain sort. So far the internet has avoided anything of that sort; certain classes of *content* have been differentiated from one another in a regulatory fashion, but never before a class of *data*.

Soon we may wind up with something where the proverbial "Joe Sixpack" pays relatively high fees on his Skype phone he bought at Wal-mart and plugged into the wall, while all the "techies" pay nothing to use their "alternative" VoIP setups. Meanwhile a bizarre cat and mouse game goes on, as the authorities complain about "speech piracy" and attempt to find ways to sniff out VoIP data or prevent "pirate" VoIP programs from connecting to the larger VoIP network, and the tech community comes up with increasingly elaborate ways to keep the authorities to notice what sort of data exactly it is that they're sending.

In the meanwhile, the ongoing effort by router companies to make "smart" routers capable of identifying things like streaming media packets and handling them in a slightly more intelligent manner is scuttled-- because 80% of all streaming audio data no longer looks like streaming audio data.

Anyone have a link to the RAT_PENIS.TXT story?

Questions about efficiency, bandwidth...

[wskellenger]

Can the existing network infrastructure handle the additional bandwidth that would be demanded, if significant, by VoIP?

How exactly does all of this work? It seems like the existing analog infrastructure would remain in place. After all, asking everyone to replace their existing handsets isn't going to happen anytime soon. Now the phone company will A/D my speech, then send it out directing it to another server local to the number that I dialed, which will D/A my speech and reproduce it for the ear of a person in another home?

If the above is true, it seems that it would make sense for some additional offering from the phone company that would eliminate the A/D portion of the communication and the phone line to your house would become a broadband connection. Make the handset perform the Voice-->IP conversion with embedded software, and I can ditch my dial-up ISP...

Re:One practical problem ...

[YetAnotherDave]

minor detail: voice data is passed via RTP, which uses UDP, not TCP. Retransmission of voice data is generally not worth the effort, so the lighter-weight UDP protocol is more efficient...