FCC rules Internet phone companies have to pay Kansas industry fees

Internet phone services such as Vonage and Skype now must chip in, just as traditional phone companies do, to help bring service to remote areas of Kansas, according to a new ruling from the Federal Communications Commission.

In one its first rulings in Kansas centering around new issues arising from the advance of the Internet, the FCC is requiring those Internet phone service companies, or voice over Internet providers (VoIP), to contribute to the Kansas Universal Service Fund like the rest of their industry counterparts. The Universal Service Fund is a pot of money to which all telecommunications companies in Kansas contribute, which helps telephone service providers install phone lines in rural areas or parts of the state where it's expensive to set up. As of August 2010, there was $73.6 million in the Kansas Universal Service Fund (KUSF).

"We believe all Kansans benefit from the KUSF. The KUSF supports high-cost areas in the state, which naturally benefits consumers that live in the high-cost areas because it allows service to be affordable to those consumers," said Cara Sloan-Ramos, with the Kansas Corporation Commission. "People that live in lower-cost areas benefit as well, because they are able to call their friends and relatives that live in the high-cost areas that might otherwise not be able to afford telephone service."

Kansas statute requires VoIPs to contribute to the fund. But the 8th U.S. Circuit Court of Appeals ruled in May 2009 that FCC needed to issue a blanket order to VoIP companies before states could collect such fees. Some VoIPs in Kansas were not paying up. So in July 2009, Kansas and Nebraska petitioned the FCC to issue the declaration that states have the ability to collect those fees from VoIP companies.

On Nov. 5, 2010, the FCC agreed with the states, saying they have the right to demand VoIP companies pay their fair share to meet Kansas statute funding requirements that govern the Universal Service Fund.