December 2009

On December 1, the Federal Communications Commission released a Public Notice seeking comment on whether to issue a Notice of Inquiry (NOI) relating to the appropriate policy framework to facilitate and respond to the market-led transition in technology and services, from the circuit switched Public Switched Telephone Network (PSTN) system to an Internet Protocol (IP)-based communications world. The FCC sought help identifying the relevant policy questions that an NOI on this topic should raise in order to assist the Commission in considering how best to monitor and plan for this transition. Comments in the proceeding were due Monday, Dec 21 and here's a look at what the public is telling the FCC.

The National Association of State Utility Consumer Advocates believes that the Commission should issue an NOI as the first step in developing a policy framework and focused its comments on what aspects of traditional regulatory frameworks are important to consider, address, and possibly modify in an effort to protect the public interest in an all-IP world. The issues NASUCA says should be addressed in a NOI are:

• Does the transition from provisioning telephone service over the circuit-switched networks to networks using IP protocol alter the fundamental nature of the service?
• Should Regulation of Telecommunication Services Provided Over IP Networks Continue in the Same Fashion as Regulation Applied to Telecommunication Services Provided on the PSTN?
• What services should be considered "information services" and what services should be considered "telecommunications services" and subject to regulation?
• The Commission should seek comment on how the principles of common carriage and no undue or unjust discrimination should apply in an all IP world.
• How does the transition to an all IP world affect the long-standing policy of promoting competition in telecommunications markets? The Commission should also ask parties to address what regulations should apply to those telecommunications services that comprise the infrastructure that supports the Internet. How should the Commission address issues related to the retirement of copper plant? How does the transition affect the choices that will be available to customers?
• What, if any, changes to the regulatory structure, including additional regulatory tools, are necessary to safeguard the public interest as a result of technological changes in the way that telecommunications services are provided?
• What are the appropriate roles for the Commission and for the states in regulating telecommunication services provided using IP?
• The Commission should ask parties to address universal service in the new environment. What policies, regulations and programs should retained to protect and advance national universal service objectives? What changes to existing universal service support mechanisms are necessary? Should carriers be required to offer stand-alone voice services so that people who are economically disadvantaged are not forced to purchase expensive bundles?
• What service quality issues should be addressed by regulators in an all-IP world?
• The Commission should ask for comment on the public safety issues that are associated with VoIP. What requirements should apply regarding the provision of E911 service for VoIP service? What issues arise from the reliance of VoIP service on the public power supply? What actions should the Commission take to ensure that service is reliable?
• The Commission should seek comment on privacy issues that are associated with VOIP.
• What types of consumer protection rules and regulations are necessary in an all IP, or partial IP world? Should existing policies, regulations and rules be retained, modified or expanded?

The New Jersey Division of Rate Counsel asks that the NOI clarifies that states have a clear role in regulating VoIP (particularly, fixed VoIP) and address:

• Who controls the IP-based platform within specific geographic markets?
• What factors will control whether excessive concentrations of power exist at any particular layer of the network?
• What is the role of open access to increasing the likelihood of effective competition developing?
• Pricing issues
• Service quality issues
• Consumer education
• Protections for people with disabilities, low income and seniors

USTelecom said the FCC must take care not to make policy under the mistaken presumption that such technology will completely replace circuit-switched networks anytime soon. Especially in lower-density, higher-cost areas of the country, the reliance on the existing PSTN network will continue to be the most economical wireline network technology for delivering both voice and broadband services to consumers. USTelecom urged the FCC to reform inter-carrier compensation and the universal service funding while also addressing consumer protection, public safety, disability access, and regulatory jurisdiction.

The National Telecommunications Cooperative Association has offered a plan with eight elements to create a path for rural consumers and small rural ILECs undergoing the IP transition are eight elements:

1. Transition high-cost universal service fund (USF) voice support to high-cost USF broadband support over a reasonable period of time;
2. Maintain rate-of-return (RoR) regulation and study area average costs for rural ILECs throughout the transition period;
3. Allow RoR carriers to receive high-cost USF support for stand-alone DSL during and after the transition period;
4. Require interconnected voice over Internet protocol (VoIP) traffic to pay access charges throughout the transition period;
5. Allow state commissions to reduce intrastate tariffed access rates to interstate tariffed access rate levels within five years, while at the same time freezing interstate access rates.
6. Create an access rate cost recovery restructure mechanism (RM) for lost access revenues;
7. Retain carrier of last resort (COLR) obligations for USF recipients during transition to protect rural consumers; and
8. Apply the Regulatory Flexibility Act, 5 U.S.C. § 610 et seq., when crafting the IP transition rules for small business entities, which include small rural ILECs.

CTIA -- The Wireless Association -- urges the FCC to carefully consider a number of issues that could impact the move to more efficient all-IP networks including regulatory parity among providers. Ars Technica reports that filing amounts to a well-written plea for identical treatment when different technology platforms accomplish the same goal. But the wireless industry only wants consistent regulation when the consistency helps it out. Apply the consistency principle consistently -- especially to network neutrality -- and suddenly the industry has a bazillion reasons why it's "different."

Sens Herb Kohl (D-WI) and Orrin Hatch (R-UT) have sent a letter to Federal Communications Commission Chairman Julius Genachowski asking the agency to put spectrum already in the FCC's inventory into the hands of new wireless carriers to promote competition among broadband Internet providers. "Rather than leaving it to the Department of Justice to address market failures after the fact, we believe the FCC should readily use its ample authority to promote new entry and increased competition in the broadband market," they wrote. Specifically, the lawmakers ask the FCC to put some of three spectrum bands already in the FCC's inventory into use by consumers. The three spectrum bands were identified in a meeting last week at the FCC where Blair Levin, head of the agency's national broadband planning process, revealed potential ways to get high-speed Internet to more U.S. homes. Senators asked Genachowski to explain what it plans to do with those spectrum bands.

[Commentary] Forgoing the laptop in favor of a WiFi-enabled device such as a smartphone is becoming increasingly commonplace. Thanks to the growing popularity of such devices, including phones and cameras, Wi-Fi hotspots are becoming increasingly useful.

"The ubiquity of Wi-Fi has created hotspot coverage as an expected amenity at many places of business," says Frank Dickson, In-Stat analyst. "While consumer or leisure users do not often carry a laptop, they do have Wi-Fi enabled handhelds and are using these devices to access hotspots. This, coupled with the service being bundled with mobile plans, is making hotspot access much more consumer-oriented compared to the service's former business focus."

Handhelds accounted for 35 percent of all hotspot connections in 2009, up from 20 percent in 2008, and are forecast to account for fully half of them by 2011, according to market research firm, In-Stat,. The research firm estimates that the hotspot usage on the whole will increase 47 percent in 2009, bringing the total number of connections to 1.2 billion. A report by JiWire estimates that during the first half of 2009, the number of Wi-Fi hotspots around the world grew by 9 percent. According to In-Stat research, WiFi-enabled devices such as game players, personal media players and cameras are going to see a sharp increase between 2009 and 2013, rising from 108.8 million to 177.3 million.

From 1999 to 2009, the world changed dramatically. Malik cannot help but look at our modern lives through the lens of broadband. Thanks to that technology, the world today is more closely knit than ever. From 9/11 to the Asian tsunami to the election of Barack Obama to the terror attacks in Mumbai to the uprising in Iran, broadband enabled us to experience such global events together. He looks back at the decade that was in terms of companies and the products and services they brought us that have become fundamental to our everyday lives.