Telecom Law Monitor : Washington D.C. Telecom Lawyer & Attorney : Kelley Drye & Warren Law Firm : New York, Chicago, Connecticut, New Jersey, Brussels

A long time ago, we posted about a decision of the US District Court in DC declaring that VoIP traffic was not subject to access charges and the strange coalition that asked the Court of Appeals to review the case.  Now, after a nearly two year delay caused by one of the litigants' bankruptcy, the appeal is moving forward.  Since the FCC refuses to rule whether access charges applied to VoIP (even as it has recently applied interstate access rates to VoIP prospectively), this case could have an important impact on many current access charge disputes.

• Email This
• Print
• Trackbacks
• Share Link

With new access charge obligations for interconnected VoIP, new contribution obligations for non-interconnected VoIP, and possible outage reporting requirements, 2012 is shaping up as a year of changes for VoIP providers.  Another possible change may be in store for how VoIP providers obtain access to telephone numbers.

Since 2005, various petitions have been pending seeking a waiver of FCC rules to allow interconnected VoIP providers to obtain direct access to numbering resources through the North American Numbering Plan Administrator and the Pooling Administrator.  In March 2011, Vonage renewed its request for waiver and submitted supplemental information in support of its request.  Shortly after Christmas, the FCC released a Public Notice seeking comment on Vonage's filing and its supplemental materials.  With a brief extension granted, the comments are due on January 25. 

VoIP providers and CLECs serving VoIP providers should monitor this docket closely.

• Email This
• Print
• Trackbacks
• Share Link

Back in October, the FCC released an order implementing the Twenty-First Century Communications and Video Accessibility Act of 2010 (CVAA).  Among other things, the order expanded the pool of contributors to the Telecommunications Relay Service Fund to include virtually all VoIP providers, including those that did not fit the FCC's definition of "interconnected" VoIP.

To implement this contribution requirement, non-interconnected VoIP providers are required to register with the FCC by filing FCC Form 499-A, which is better known as the form used for universal service fund contributions.  (The Form 499-A is used for other revenue-based support funds as well.)  Providers must file this form no later than December 31, 2011.  At this time, it appears that fewer than a dozen new providers have registered to date.  

• Email This
• Print
• Trackbacks
• Share Link

This morning, the FCC's November 18, 2011 High-Cost USF and Intercarrier Reform Compensation Order was published in the Federal Register triggering an effective date of December 29, 2011 for all parts of the Order and rule changes adopted therein, except for the information collection requirements contained in some of the rules adopted.   Those information collection requirements will not become effective until approved by the Office of Management and Budget.  A subsequent Federal Publication will be made announcing the effective dates of those sections.  A copy of today's Federal Register publication is available here.

• Email This
• Print
• Trackbacks
• Share Link

Late yesterday, the FCC released the text of its USF Reform and Intercarrier Compensation Reform Order, which it adopted on October 27.  The FCC's rules, among other things, transition terminating access charges to zero, apply access to VoIP-PSTN traffic, adopt rules addressing access stimulation (prevalent in free conferencing, for example), and tackling the problem of phantom traffic.  

The order is 759 pages long, with over 2,500 footnotes and 84 pages of rules.  As we warned, the impact of these rules on individual business plans is highly fact-specific.  We encourage you to contact your advisor to learn more. 

• Email This
• Print
• Trackbacks
• Share Link

For audio conferencing providers, "round two" of the FCC's regulation has begun.  (Round one was 2008's Audio Bridging Classification Order, which applied direct USF contributions to the audio conferencing industry).  On November 3rd, the Wireline Competition Bureau denied a Universal Service Fund appeal concerning "IP audio conferencing services."  At the same time, the Commission announced it is close to deciding the appeals of the 2008 classification order.

Both developments signal that the inclusion of conferencing in USF is here to stay.  In the appeal, the FCC agreed that USF obligations apply to "IP in the middle" audio conferencing, and denied the conferencing provider's request to apply USF prospectively.  In the upcoming reconsideration order, we don't know what the decision will say, but I would be surprised if it does not uphold the 2008 classification. 

• Email This
• Print
• Trackbacks
• Share Link

Yesterday, the FCC held its "Workshop/Webinar" on the pending proposal to extend the outage reporting requirements to interconnected VoIP and to broadband service providers.  We've noted several times that the FCC staff appears to be in favor of extending these rules.  At yesterday's workshop, two FCC Commissioners made statements that also signal their support.

• Email This
• Print
• Trackbacks
• Share Link

Interconnected VoIP provider Ooma suffered a three-hour outage late last week.  Ooma identified the cause of the outage as "an extremely rare power failure at a portion of our data center," but the effect of the outage may have a much broader impact.  The outage comes only two weeks after VoIP providers opposed extension of the FCC's outage reporting rules to them.  Timing, as they say, is everything.  In this case, the timing of the outage appears to be unfortunate.

The Ooma outage may assure FCC staff that they are on the right track in requiring reporting of such outages in the future.  Just last week, the Public Safety Bureau announced it was holding a "Workshop/Webinar" on the extension of the reporting requirements to VoIP and broadband providers.  The portion of the workshop devoted to outage reporting is described as examining how public safety agencies and critical infrastructure industries rely on communications "and how outages of interconnected VoIP and broadband Internet service providers could affect their vital work."  It looks like the FCC needs no convincing of the wisdom of requiring new outage reporting by VoIP providers. 

• Email This
• Print
• Trackbacks
• Share Link

The Commission's long-standing refusal to classify VoIP services continues to feed litigation between telecommunications carriers.  Previously, a coalition of carriers asked the courts to decide the issue and it appears likely the FCC will address VoIP at least prospectively, but in the meantime, cases like this will persist.

In the latest case, CLEC Pac-West and IXC Verizon Business sparred in dueling Petitions for Declaratory Ruling stemming from a primary jurisdiction referral by a U.S. District Court in California.  The petitioners offer vastly different approaches to resolving the dispute. 

• Email This
• Print
• Trackbacks
• Share Link

Implementing the Truth in Caller ID Act passed last December, the FCC adopted rules prohibiting the fraudulent manipulation of caller ID information.  These so-called anti-"spoofing" rules track the statutory language to prohibit any person from "knowingly transmit[ing] misleading or inaccurate caller identification information with the intent to defraud, cause harm, or wrongfully obtain anything of value."  The Commission also released a report to Congress recommending additional legislative changes to strengthen the spoofing protections.

• Email This
• Print
• Trackbacks
• Share Link

Last month, we noted that the FCC is proposing to expand outage reporting obligations to interconnected VoIP providers, broadband Internet access providers and to Internet backbone providers.  The new rules propose reporting based on latency and jitter, and effectively would establish a minimum service quality for broadband networks.

Yesterday, the FCC published notice of the new rules in the Federal Register.  Comments on the proposed rules will be due on August 8, with reply comments due on October 7.  In addition, parties wishing to comment on the paperwork reduction requirements associated with the rules, may do so by August 8.  Those comments are due to the Office of Management and Budget (OMB), not the FCC.

• Email This
• Print
• Trackbacks
• Share Link

In late May, the Voice on the Net Coalition ("VON") held a series of meetings with FCC Commissioner's offices concerning VoIP regulations.  The Coalition discussed topics affecting 21 pending FCC dockets, and, according to the summary of the meetings, "expressed concern that additional regulation of the IP communications industry could deter investment and innovation ..."  The Coalition opposed a variety of new regulations:

• The Coalition opposed imposition of intercarrier compensation obligations to VoIP and argued for bill and keep for VoIP traffic;
• The Coalition opposed using advertising revenues to assess TRS obligations on VoIP providers;
• The Coalition opposed requirements to file broadband deployment reports (Form 477) and to apply FCC billing rules to VoIP;
• The Coalition urged a narrow interpretation of new disability access requirements and supported "broad waivers" of such rules; and
• The Coalition opposed the opening of a rulemaking to require E911 for mobile VoIP applications.

The Coalition also attached a chart summarizing FCC actions to regulate interconnected VoIP services.  The chart mirrors the summary we prepared back in November of the regulatory obligations of VoIP services.  VON's summary chart identifies 8 pending proceedings proposing to add regulatory obligations to VoIP service providers and details 13 previous FCC orders regulating VoIP services.  Since the Coalition prepared its chart, the FCC added one more proposed obligation:  a proposal to require interconnected VoIP providers to report their international traffic and revenues.  See Kelley Drye's Client Advisory on the international reporting obligations for more details. 

• Email This
• Print
• Trackbacks
• Share Link

As we discussed previously, the FCC is proposing to extend outage reporting obligations to interconnected VoIP providers, broadband Internet access providers and to Internet "backbone" providers.  With the release of the text of the Notice of Proposed Rulemaking, we now know the specific triggers the FCC is proposing to use for these providers.

In a first, the FCC is proposing to set the triggers based on packet loss, average round-trip latency and average jitter measurements.  This proposal essentially would set minimum service quality standards for IP-enabled services -- another first for the FCC.

• Email This
• Print
• Trackbacks
• Share Link

As we noted earlier this week, the FCC is moving ahead to expand its reporting obligations for telecommunications outages.  Touting the outage reporting rules as a 911 service protection, the FCC proposed to expand its outage reporting rules to require interconnected VoIP and broadband Internet service providers to submit reports to the FCC, as wireline, wireless, cable and satellite providers must today.  Indeed "resilience" and "reliability" were the buzzwords of the presentation before the Commission. 

5/16 UPDATE:  The FCC released the text of its proposal, which would set a service quality standard for IP-enabled services for the first time. 

• Email This
• Print
• Trackbacks
• Share Link

It has taken nearly a year since the FCC's Public Safety Bureau first started laying the groundwork, but the FCC is poised to consider expanding its outage reporting rules to cover interconnected VoIP communications and broadband Internet access providers.  The Commission will consider a Notice of Proposed Rulemaking to extend the outage reporting rules at its May 12 Commission Meeting. 

This item has been moving forward under the radar of most VoIP and broadband providers.  As we told you back in July, the Public Safety Bureau sought comment on how to apply its outage reporting obligations to interconnected VoIP services and broadband Internet access services.  The Public Notice produced only a handful of comments and replies.  Even in the few days before the FCC announced its meeting agenda -- typically a very busy time for those with an interest in an order -- only three ex parte notices were filed on the proposal.  The minimal level of interest won't last long, however.  Once the NPRM is released this week, a much larger universe of interested parties is likely to appear. 

Note:   Also on the May 12th agenda are proposed revisions to two international service compliance obligations -- the FCC's settlements policy and its Part 43 reporting requirements for international traffic.  International carriers should pay close attention to both items. 

• Email This
• Print
• Trackbacks
• Share Link

The Commission's efforts to resolve the 2009 Omnibus CPNI NAL continue to provide insights into the enforcement process generally.  In the past, we've commented on surprisingly small settlements and odd provisions, but two orders earlier this week are especially cryptic.

In both orders, the Chief of the Telecommunications Consumers Division of the FCC Enforcement Bureau concluded that "no forfeiture should be imposed" with respect to the carriers identified.  I would like to provide you a definitive reason for the cancellation, but the orders literally provide no explanation of the basis for that conclusion. 

In one case, I believe the rationale is that the entities are interconnected VoIP providers.  As we've explained previously, because of the Commission's refusal to determine if interconnected VoIP providers are telecommunications carriers, they get one free bite at FCC violations.  Each of the three carriers listed in this cancellation order reports itself as an interconnected VoIP provider on its USF forms.  Because of that, the FCC could not impose a fine for failing to file the CPNI certification unless the FCC had issued a Citation first.

The other case is truly mystifying.  The two carriers listed in this cancellation order are listed as a "CAP/LEC" and an "IXC", respectively, in the USF filer database.  Although one appears to have ceased providing business in 2007, the other provider filed a Form 499-A in April 2011.  We are left to guess what circumstances justified the decision not to impose a forfeiture.

• Email This
• Print
• Trackbacks
• Share Link

According to the FCC's weekly list of pending items on circulation, the Commission appears ready to resolve a longstanding petition by an interconnected VoIP provider to cancel its 2007 FCC regulatory fee.  The ruling could have impact on future regulatory fee assessments, but the specific relief relating to 2007 (if the petitioner is successful) is likely to be limited to the petitioner.

See below for more on the pending action.

• Email This
• Print
• Trackbacks
• Share Link

As we've noted previously, the U.S. Department of Justice has urged the FCC to take an expansive interpretation of the Truth in Caller ID Act of 2009.  In comments filed last week, the Department continued its effort to have the FCC apply the rules to VoIP providers, including those not subject to any FCC rules today.

In its comments in response to the FCC Notice of Proposed Rulemaking, the Department urged the FCC to adopt rules regulating Caller ID spoofing providers directly.  It contends that this authority is rooted in the Truth in Caller ID Act of 2009 itself and in the Commission's "ancillary" authority over non-common carriers (the same authority at issue in the Comcast net neutrality case).  The Department does not explicitly mention non-interconnected VoIP providers or one-way VoIP providers in its comments, but its arguments would extend to any service provider offering spoofing services. 

The Department's comments are available here.

• Email This
• Print
• Trackbacks
• Share Link

With the continued uncertainty regarding the classification of VoIP service and the application of intercarrier compensation to VoIP, litigation over VoIP charges is extensive.  In the latest case to reach a decision, the FCC ruled that a CLEC serving an affiliated VoIP provider may not collect tariffed access charges for terminating calls to the VoIP customers or for 8YY calls originated by the VoIP customers.

The FCC order was issued in a formal complaint case brought by AT&T against YMax Communications Corp., whose affiliated entity provides the MagicJack VoIP device.  The Commission agreed with AT&T that it did not have to pay YMax's access charges for the traffic in question.

The FCC's decision is a narrow one, however.  It ruled only that the CLEC's tariff language did not apply to the traffic, not that VoIP may not be subject to access charges.  The primary lesson of the case is that a VoIP provider must carefully consider the description of its services, and not necessarily use "cookie cutter" tariffs designed for traditional PSTN traffic. 

• Email This
• Print
• Trackbacks
• Share Link

In response to the passage of anti-spoofing legislation late last year, the FCC recently adopted a Notice of Proposed Rulemaking to tighten rules relating to the "spoofing" of caller ID information.  The Commission is seeking comments in late April and early May, which would make it tough for the Commission to meet the legislation's six-month deadline for the adoption of implementing rules.

The NPRM contains a surprising proposal to bypass the ordinary enforcement processes the Commission uses.  See below for that and other highlights of the proposal.

• Email This
• Print
• Trackbacks
• Share Link

The FCC's February 9, 2011 Universal Service Fund (USF) and Intercarrier Compensation (ICC) Reform NPRM was published in this morning's Federal Register (FR).  This is the triggering event for establishing the actual comment due dates set forth in the item.  Here are  the deadlines:

Comments on Section XV (ICC "Immediate Reform", including VoIP classification, phantom traffic and traffic stimulation): 30 days from FR publication / April 1

Reply Comments on Section XV (ICC "Immediate Reform", including VoIP classification, phantom traffic and traffic stimulation): 45 days from FR publication / April 18

Comments on all Sections other than XV: 45 days from FR publication / April 18

Comments of State Members of the Federal-State Joint Board on Universal Service: 59 days from FR publication / May 2

Reply Comments on all Sections other than XV: 80 days from FR publication / May 23

And the "ex parte" round is likely to rage all summer long....

• Email This
• Print
• Trackbacks
• Share Link

Late yesterday, the FCC released its latest NPRM on high cost USF and ICC reform (see our 2/8 post).  The 289 page item, available here,  sets forth staggered comment dates triggered by federal register publication.  The first -- 30 days after Federal Register publication -- is for comments on intercarrier compensation for VoIP traffic, rules to address phantom traffic and rules to reduce access stimulation.  Reply comments are due 15 days after that.  Comments on the rest of it will be due on the same day (45 days after Federal Register publication).  State members of the Federal-State Joint Board on Universal Service get two extra weeks to file comments.  All reply comments on the remaining sections are due 80 days after federal register publication.

• Email This
• Print
• Trackbacks
• Share Link

The FCC earlier today adopted (but has not yet released) a substantial NPRM on universal service fund (USF) and intercarrier compensation (ICC) reform, signaling that the agency is ready (again) to engage anew in its decade long quest to reform these interrelated subsidy and compensation regimes that nearly all interested parties agree are unsustainable.

With roughly $4.5 billion/year in play on the high cost USF side and approximately $8 billion/year at stake on the ICC side, this is a proceeding in which many will want to weigh-in or at least track carefully. Yes, we realize that we said this 10 years ago and again back with the last swell of activity in 2008, but the timing and circumstances of today’s action, as well as the remarks of each Commissioner seem to suggest that odds of the agency taking concrete steps toward adopting meaningful reforms are higher now than they ever have been.

That said, it remains unlikely that the agency could adopt an order addressing comprehensive high cost USF and ICC reform before 4Q11. The process will be neither quick nor easy. And, as many will note, conspicuously absent from today’s NPRM are proposals for USF contribution reform. It seems strange that the fund is to be re-purposed to support broadband in advance of adopting a requirement that broadband providers contribute to the fund. Lifeline reform also gets punted to another day, but the agency promises it is working on getting to this soon. With the proposed USF Mobility Fund also on a separate track, it appears that the Commission has liberated itself from the notion that it must address all pieces of the puzzle at one time in one order.
 

• Email This
• Print
• Trackbacks
• Share Link

In late December, Congress passed new Anti-Spoofing legislation.  As we told you at the time, the Act requires the FCC to enact implementing regulations within 6 months.  In anticipation of that rulemaking, the U.S. Department of Justice's Criminal Division submitted a letter to the FCC with its recommendations for the regulations.

The DOJ letter is described in more detail below.  Most notably, DOJ recommends verification obligations be imposed on providers of spoofing services and proposes an expansive definition of "IP-enabled Voice Service" that would impose obligations on services heretofore not subject to FCC regulations.  If the FCC agrees, new classes of entities would be subject to compliance obligations relating to Caller ID spoofing.

• Email This
• Print
• Trackbacks
• Share Link

Two developments last month portend a more difficult time for entities "spoofing" caller ID information.  On December 22, President Obama signed into law the Truth in Caller ID Act of 2009 [sic], which makes it unlawful for a person to transmit misleading or inaccurate caller ID information with an intent to defraud.  In addition, the FTC is seeking comment on rule changes to strengthen the caller ID provisions of its Telemarketing Sales Rule (TSR). 

Descriptions of both developments are provided below.

• Email This
• Print
• Trackbacks
• Share Link

As has been expected, the FCC late Friday released an order finding that states can require nomadic interconnected VoIP providers such as Vonage to pay state universal service fund contributions on a prospective basis provided that (1) the relevant state’s contribution rules are consistent with the FCC’s universal service contribution rules (i.e., states must allow a provider to treat as intrastate for state USF purposes the same revenues treated by the provider as intrastate under the FCC’s USF contribution rules), and (2) the state does not apply its contribution rules to intrastate VoIP revenues attributable to another state (i.e., no two states can impose USF assessments on the same intrastate revenues).

• Email This
• Print
• Trackbacks
• Share Link

Our post about the unique enforcement posture of interconnected VoIP quickly became the most popular post on the Telecom Law Monitor.  One person asked if we could elaborate on the differences in regulatory treatment between traditional telecom services, interconnected VoIP and non-interconnected VoIP (like Skype).   In response, we prepared a chart comparing applicability of the major telecom obligations to both types of VoIP.

• Email This
• Print
• Trackbacks
• Share Link

What:   FCC Form 499Q: Telecommunications Reporting Worksheet - Quarterly Filing for Universal Service Contributors.  Contributors must project 1Q telecommunications revenues for 2011 and report actual telecommunications revenues for 2Q 2010.

When:  Due on November 1, 2010

Who must file:  All carriers that are required to contribute to the maintenance of universal support mechanisms.  De minimis contributors (those with an annual contribution to the FCC's Universal Service Fund below $10,000) need not file a 499Q but must keep records demonstrating their de minimis status. 

See the KDW Client Advisory for more information.

REMINDER:  Revisions to the 499Q must be filed within 45 days of this deadline. 

REMINDER:  CMRS and interconnected VoIP providers that rely on traffic studies instead of the jurisdictional safe harbor must submit their studies quarterly.

• Email This
• Print
• Trackbacks
• Share Link

What are the ramifications of the FCC's refusal to classify interconnected VoIP?  For one, it complicates the job of the FCC's Enforcement Bureau.  As a recent Citation to Vantage Communications shows, the failure to classify interconnected VoIP as either telecom or non-telecom has allowed interconnected VoIP providers to get one "free violation" before the FCC imposes fines for violations of the Act or FCC rules.

In Vantage Communications, the Enforcement Bureau found that Vantage failed to provide 911 calling capability to at least three customers.  This is a clear violation of Section 9.5(b) of the FCC rules, which requires interconnected VoIP providers, "as a condition to providing service to a consumer," to provide E911 calling capability.  The FCC issued a Citation to Vantage -- a warning -- and stated that future violations could subject it to fines or other enforcement action.  So why does Vantage get a warning when other telecommunications carriers would get fined?  Keep reading to learn why.

• Email This
• Print
• Trackbacks
• Share Link

Despite issues over the FCC's jurisdiction in light of the Comcast decision, the FCC's Public Safety Bureau took a step toward possible extension of the FCC's outage reporting requirements to broadband service providers and providers of interconnected VoIP services.  In a July 2 Public Notice, the Bureau seeks comment "in advance of" a possible Commission rulemaking proceeding.  The comment request in many ways presumes that the outage reporting rules should apply, and asks a number of questions about how they could apply and what changes might be necessary in light of the different technologies involved.  Clearly, the Bureau is seeking to do its homework before the Commission initiates a rulemaking proceeding.

• Email This
• Print
• Trackbacks
• Share Link

A diverse group of telecom companies and trade groups have jointly submitted a supporting brief to the U.S. Court of Appeals in the Paetec v. CommPartners appeal.  The Joint Brief includes ILECS like AT&T and Verizon, CLECs like Neutral Tandem, and normally contrary trade associations like USTA and the VON Coalition. Although these parties have wildly divergent views on how the VoIP access charge dispute should be resolved, they all agree that the Court of Appeals should decide the issue now.  The Joint Brief states that the parties submitting  "have differing views about the merits" of the district court ruling, "but all agree that a decision from" the Court of Appeals is desirable to clarify the situation for all concerned.  

No one knows for sure, but the many pending cases and disputes on VoIP access charges collectively probably have hundreds of millions of dollars at stake.   The FCC has exerted much effort to avoid making a decision on the court referrals and various petitions that it has received on the subject since 2005. 

• Email This
• Print
• Trackbacks
• Share Link

The VoIP jurisdictional saga continues.  Last month, we discussed a decision by the Pennsylvania PUC asserting jurisdiction over intrastate Voice over IP calls and a decision by a US District Court reaching the opposite conclusion.  Tomorrow, parties are asked to comment on a petition seeking, among other things, to preempt the Pennsylvania decision.  We will be watching the comments and will post on anything of interest in the comments.

4/6/10 QUICK UPDATE:  19 entities filed comments in response to the Global NAPs petition.  Most were ILECs or state commissions opposing the specific rulings proposed.

This latest VoIP proceeding has its origins in the Pennsylvania PUC decision. After the decision was issued, the carrier ordered to pay intrastate access charges, Global NAPs, filed a Petition for Declaratory Ruling with the FCC. The Petition seeks four rulings from the FCC:

1. The Vonage Order prohibits state commissions from subjecting VoIP traffic to intrastate tariffs;

2. Once a carrier’s service has been determined to be “primarily nomadic” VoIP, the remainder of its traffic also is interstate, absent “clear proof of purely intrastate calls”;

3. The Local Exchange Routing Guide (“LERG”) is not a reliable proxy for the geographic point of origination of VoIP calls; and

4. Connecting carriers that forward VoIP traffic are immune from interstate and intrastate switched access charges.

In the alternative, Global NAPs seeks preemption of the Pennsylvania PUC decision and “recent and/or impending” rulings in Maryland and New Hampshire.

The FCC released a Public Notice seeking comment on the Global NAPs Petition.  Comments are due April 2; replies April 12. 

• Email This
• Print
• Trackbacks
• Share Link

The Genachowski FCC is enamored with the bully pulpit as an enforcement tool.  In the year since the new Chairman has taken office, we've seen examples with FCC letters to Apple regarding its iPhone approval practices; letters to Google concerning the classification of Google Voice; and letters to wireless carriers concerning their early termination fees.  This time, the FCC's Public Safety and Homeland Security Bureau "reminds" telecommunications carriers of the need to provide diversity and redundancy in their 911 and E-911 services.  Although the Public Notice is not enforceable and does not cite to enforceable rules, it clearly is intended to influence carrier behavior.  Those who fail to heed this "reminder" could find themselves in an investigation questioning whether their practices are "just and reasonable."

The Public Notice stemmed from a review by the Bureau of network outage reports that carriers are required to file.  The Bureau stated that it has observed a "significant number" of 911/E911 outages caused by a lack of diversity.  Moreover, it notes that these outages "could have been avoided at little expense to the service provider"  (emphasis mine).   The clear implication is that FCC tolerance for these types of outages will diminish over time. 

Follow the link for a discussion of the diversity mistakes highlighted by the Bureau.

• Email This
• Print
• Trackbacks
• Share Link

In a February 11, 2010 ruling in Palmerton Telephone Company v. Global NAPs South, Docket No. C-2009-2093336, the Pennsylvania PUC concluded that Global NAPs is required to pay intrastate access charges for terminating VoIP calls.  The opinion is 30 pages long and highly detailed, but overall it appears to be contrary to the recent decision by the U.S. District Court in Paetec v. CommPartners, where the court ruled that VoIP services are not subject to access charges.  And although the PA PUC attempted to distinguish another May 1, 2009 ruling of the U.S. Court of Appeals in Vonage v. Nebraska PSC preempting a state regulation of VoIP, the new PA PUC decision appears to contradict that Vonage ruling as well.  The May 2009 Vonage opinion upheld a lower court finding that the FCC had "concluded nomadic interconnected VoIP services were only subject to regulation by the FCC."  The PA PUC rejects that reading of Vonage on the basis that Global NAPs' wholesale services are different from Vonage's retail services (even while recognizing that over 50% of Global NAPs traffic may be VoIP).  The PUC thus claims jurisdiction and orders Global NAPs to pay intrastate access charges to Palmerton. 

These conflicting court and PUC rulings are providing increased need for the FCC to finally stop avoiding the issue and address directly the application of access charges to VoIP services.

• Email This
• Print
• Trackbacks
• Share Link

UPDATED -- FORM 499 RELEASED

The FCC's Wireline Competition Bureau announced the new FCC Form 499A today.  This form, which must be used to file the April 1 annual revenue report, includes several potentially significant changes.  Audio bridging providers (conference service providers) and those close to the de minimis threshold are most affected.

As of COB yesterday, only the announcement was available.  The 499A itself will be released today and I will update this post when it is available.   UPDATE:  The new Form 499A is available here.

Follow the jump for a discussion of the changes.

• Email This
• Print
• Trackbacks
• Share Link

The U.S. District Court in D.C. ruled today that IP-originated calls are "information services" that are subject to the local reciprocal compensation scheme - and not access charges - for intercarrier compensation.  The ruling came in Paetec Communications v. CommPartners, LLC, U.S. Dist Ct for DC, Civ. Action No. 08-0397.   Paetec filed the case against CommPartners seeking to collect access charges for all calls, both TDM and VoIP originated.  CommPartners conceded that it owed access fees on the TDM calls, but argued that VoIP calls are information services exempt from access under the FCC's longstanding access charge exemption for such calls.  The Court agreed.  In reaching its opinion...

• Email This
• Print
• Trackbacks
• Share Link

The enforcement date for the FTC "Red Flag Rule" to prevent identity theft  has been extended until November 1, 2009 in order to give businesses more time to understand the rule and take steps to comply.  The rule applies to any entity under FTC jurisdiction that is a "creditor" or "financial institution" and which maintains customer accounts which extend credit through post-paid arrangement.  This would include a VoIP provider that bills monthly after the fact, for example.  For those subject to the rule, they must take steps outlined by the FTC to allow them to look for "red flags" which might indicate identity theft from their customer information.  Click here for more information.  The rule should be taken seriously, both because FTC enforcement action can be taken against companies who fail to comply, and because failure to comply might create follow-on civil liability in class action or consumer lawsuits.  Additional information about the Red Flag Rule is also available on Kelley Drye's Advertising Law blog.

• Email This
• Print
• Trackbacks
• Share Link

The Consumer and Governmental Affairs Bureau of the FCC has reversed a November decision by its Consumer Policy Division relating to alleged slamming by a VoIP provider. The Bureau's May 19 ruling granted a request to reconsider the Consumer Policy Division's November 6, 2008 decision that Mediacom, a VoIP provider, had violated the "slamming" rules by switching a customer from Verizon to Mediacom without following the FCC's prescribed procedures for authorizing carrier changes. The November Order of the Division stated that it had sought to contact Mediacom but gotten no response, and thus it applied a presumption of liability to Mediacom and held it liable for slamming. The new Bureau Order indicates that Mediacom had actually responded to the Division, but had misfiled it and thus the Division was unaware of the response at the time it ruled. Then, stating that "the Commission's carrier change rules have not been extended to VoIP", the Bureau rescinded the November Order and denied the slamming complaint against Mediacom. The Bureau noted that the FCC requested public comment on the application of the slamming rules to VoIP in 2004, but has never acted on that proposal.

This latest ruling remains consistent with the FCC's position that VoIP providers are only subject to carrier rules after the FCC explicitly decides to apply them; in contrast, more traditional carriers are obligated to observe all rules simply by virtue of being authorized to operate as common carriers. In light of the FCC's extension of the number porting rules to VoIP providers, however, it seems very likely that the slamming rules will be extened to VoIP sometime in the next several months.

• Email This
• Print
• Trackbacks
• Share Link

In a move that surprised almost no one, the FCC extended its discontinuance of service rules to providers of interconnected VoIP services.  When this latest action becomes effective, interconnected VoIP providers will be required to give customers advance notice of plans to discontinue service and will have to file for FCC approval of such actions.  FCC approval is automatic 30 days after the Commission issues public notice, unless it issues an order denying the discontinuance within that time.  Curiously, although the Vonage order preempts state regulation of interconnected VoIP entry or exit, the discontinuance rules require interconnected VoIP providers to notify the relevant state commissions in addition to the FCC.  

More broadly, as it has before, the FCC refused to classify interconnected VoIP service as either a telecommunications service or an information service.  So, while we still don't know what it is, exactly, interconnected VoIP has yet another of the obligations traditionally associated with POTS service.  

Kelley Drye Client Advisory - FCC Releases Order Extending Discontinuance of Service
Requirements to Providers of Interconnected VoIP Service 

• Email This
• Print
• Trackbacks
• Share Link

Late last night, the FCC announced its agenda for its May 13 Open Meeting. Highlighting the agenda are items relating to VoIP provider discontinuance obligations and LNP deadlines.

VoIP

The FCC announced that it plans to “consider a Report and Order concerning the requirements of interconnected VoIP providers when discontinuing service.”  This is sort of a stealth item on the agenda, as there has been virtually no discussion in the docket on this issue in the most recent months.

We hear that the FCC is likely to impose notice requirements similar to those that apply for traditional telecommunications carriers. This will continue a trend for interconnected VoIP where the FCC has imposed, one-by-one, obligations traditionally held by telecommunications carriers while steadfastly refusing to classify interconnected VoIP services. In today’s state of affairs, interconnected VoIP has nearly all of the burdens of regulation but few of the benefits. The most significant outstanding issue continues to be the application of access charges to interconnected VoIP. This topic has been a subject of litigation for some time.

Number Porting

The FCC will address porting intervals and related standards for the transfer of telephone numbers between carriers when a customer switches service providers. Cable providers in particular are pushing for a maximum interval of one-day for simple wireline to wireline and intermodal porting requests. The Order could also further address the information that carriers may require in order to implement a porting request, response intervals for customer service requests (CSRs) and other concerns raised regarding fair competition among providers.
 

• Email This
• Print
• Trackbacks
• Share Link

The U.S. Court of Appeals for the Eighth Circuit has ruled in favor of Vonage and rejected an attempt by the Nebraska PSC to claim regulatory authority over VoIP.  Vonage v. Nebraska PSC, 564 F. 3d 900 (8th Cir. 2009).  Specifically, Nebraska argued that the FCC's original ruling that VoIP is subject to exclusive federal jurisdiction was effectively modified by the FCC's subsequent creation of a "safe harbor" for payment of federal universal service payments by VoIP providers.  Nebraska argued that when the FCC created a presumption that VoIP calls are 64.5% interstate, and directed VoIP providers to make USF contributions on that basis, the inevitable corollary is that 35.5% of VoIP calls are intrastate.  On that basis, the Nebraska PSC sought to levy state universal service fees on 35.5% of Vonage's Nebraska calling.  The Court of Appeals rejected the Nebraska argument, finding that the FCC's preemption of all state regulation of nomadic VoIP was not modified or inconsistent with the FCC's creation of a 64.5% safe harbor for USF purposes.  It is noteworthy, however, that the court focused expressly on "nomadic" VoIP, leaving open the possibility of a different outcome for fixed VoIP services because the FCC's earlier preemption order is based on the nomadic nature of the service being considered in that instance. Nebraska has now petitioned the FCC to modify its order to allow for state assessment of USF on VoIP providers.

Click here to read the Kelley Drye Client Advisory.
 

• Email This
• Print
• Trackbacks
• Share Link