Senate Panel Sets VoIP Vote

U.S. Sen. John Sununu expects a number of challenges to his legislation
exempting Voice over Internet Protocol (VoIP) services from state
regulations and taxes when the bill goes before the Senate Commerce
Committee Thursday morning.

“There’s no question there are lot of members that are working at different
languages for amendments,” the New Hampshire Republican told on the eve of the first ever
congressional vote on VoIP.

While both the Senate and the House of Representatives have held a number of
hearings on VoIP and other IP-enabled services, Thursday morning’s markup
session is the first time either chamber has scheduled an actual vote to
consider moving legislation on for a full-floor vote.

“There’s been a host of amendments filed, so now the question is working
through with members on their language, seeing if there is agreement or
compromise,” Sununu said.

A spokesperson for the Senate Commerce Committee confirmed that amendments
to Sununu’s bill had been filed but cited committee policy in declining to
say how many or who has filed the amendments. The amendments themselves will
not become public record until Thursday.

With several states already attempting to regulate Internet telephony,
Sununu said the principle goal of his legislation is to exert federal
jurisdiction over IP services to avoid VoIP providers having to deal with 50
different sets of regulations. Both Minnesota and New York have already attempted to regulate VoIP as a
telephone service.

Most VoIP providers route calls from leased local
telephone lines to a gateway server that converts analog voice into data
packets. VoIP providers argue that, since the traffic is converted into data
packets, they are not telephone companies.

“We need to move forward and establish limited federal regulation in this
area rather than just take the old systems and apply them to IP services,”
Sununu said.

Sununu’s Regulatory Freedom Act of 2004 prevents the Federal Communications
Commission (FCC), which is currently conducting its own year-long
investigation into IP-enabled services, from delegating VoIP regulatory
authority to state and local officials. The legislation also exempts VoIP
applications from the FCC’s access charges.

Currently, the FCC requires access fees to be paid to incumbent carriers for
use of their networks. Internet service providers are exempt from the access
fees, having been classified by the FCC as an information service, which is
not subject to traditional telecommunications carrier rules, fees and
tariffs. Sununu hopes to extend the same information service exemption to
VoIP applications.

Even if the bill passes out of the Commerce Committee, Sununu admitted “it
is difficult to imagine” his legislation as a “standalone” measure being
voted on by the full Senate. In addition, similar legislation to Sununu’s in
the House has yet to move beyond the subcommittee level.

“At the same time, a lot of members have expressed interest in taking some
measure this year to prevent 50 different states from regulating in what is
a new, emerging, national application for IP and for broadband networks,”
Sununu said.

Earlier on Wednesday, at a Capitol Hill luncheon speech, Sununu said even
though VoIP is “here today, it is going to change a lot” over the next
several years.

“What we need to do with regulation is to say we don’t want to pre-judge
what will happen over those [years], we just want to create a consistent,
clear regulatory environment,” Sununu said. “In the long run, we’re trying
to get to a place where all forms of broadband communications are treated

Sununu’s bill does carry some federal obligations for VoIP providers. Even
though the legislation would exempt providers from paying access fees, the
bill directs the FCC to create a compensation system for incumbent telcos
and also mandates VoIP fees for universal service.

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