Carriers Latest FCC Proposal Would Cost You

[Commentary] Affordable broadband access has always been important to IT managers, and so has affordable access to telephone voice circuits, which is why a plan proposed to the FCC by some of the largest telecom players is so off base.

Not only would it raise the price of voice lines, but it also fails to address the bigger issue: the need for a wholly new, IP-based regulatory model rather than just a tweak of the outdated voice-based model. The new model that the telecoms are advocating would, among other things, "reduce all rates to a small per-minute charge of $0.0007." So it doesn't get rid of the access charge requirement, but it makes it relatively small. Here's the problem: "You rely on access charges big time if you're a rural carrier." If the access charges go away, you need to make it up somewhere else. And since the proposed plan also does away with the USF in favor of a "Connect America" broadband fund, that means that local telecom carriers will be raising rates. Bottom line, says Jim Cawley, a commissioner with the Pennsylvania Public Utility Commission: "Local rates are going to have to go up." That, of course, is a further incentive for business to avoid their voice local exchange carrier for intra-company voice traffic and choose VoIP, which travels on a network that doesn't have complex and arcane compensation rules. Regulation is a necessary evil in any society comprised of human beings and companies who would otherwise game the system. But regulators would be wise to heed Google's simple truth: It's not about voice anymore. Voice is just one app in an IP world. So simply tweaking the existing voice regulatory environment to include broadband would be a massive mistake.

It would introduce further complication to a system that's complicated enough already. A forklift is what's needed. It's going to be a wild ride. IT leaders must pay very close attention to how this regulatory environment shakes out.