VoIP for Rural phone competition?

RURAL PHONE COMPETITION ON HORIZON?
[SOURCE: USAToday, AUTHOR: Paul Davidson]
Many rural phone companies -- some backed by their state regulators -- are blocking cable TV providers from competing with them by selling inexpensive Internet-based phone service. The battles have spawned a legal ruckus that could affect millions of customers in less-populated areas. At the heart of the disputes, likely to be settled by the Federal Communications Commission or Congress, is a seismic collision of policies. While legacy rules protect rural carriers from competition, new policies promote technologies that foster greater consumer choice, even in the countryside. Voice over Internet Protocol service -- VoIP -- from cable companies is becoming the leading alternative to standard local phone service now that companies such as AT&T and MCI have stopped competing with the local phone companies. AT&T and MCI, respectively, were bought last year by SBC and Verizon. VoIP lets customers get discount phone service by connecting a regular phone and adapter to a high-speed Internet line. Time Warner has signed up 1.1 million customers for its VoIP service, which costs as little as $39.95 a month when bundled with cable and broadband. But rural telephone carriers say they are not required by federal law to provide local phone numbers and 911 services to VoIP providers. They say that these providers would not serve area residents directly and that the service used by residents would not be a “telecommunications service.” The FCC, in fact, has signaled it likely will label VoIP an “information service,” a move that VoIP providers support because it would keep them unregulated.
http://www.usatoday.com/printedition/money/20060424/voip19.art.htm

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