Principles for a Successful IP Transition: Interconnection

Regulators must ensure that competing network providers are able to interconnect in areas where there is legacy market power. Subscribers must be able to reach subscribers on any other network. In U.S. telecommunications law, interconnection is defined as “the linking of two networks for the mutual exchange of traffic.” Federal Communications Commission Chairman Tom Wheeler recently described Internet interconnection this way: "The Internet . . . it is a collection, not a thing. It is the 'Inter' net, short for its original description, 'Internetworking,' because multiple open, disparate networks exchange information seamlessly. Absent the interconnection of the parts of the collective we call the Internet there is no Internet.” Chairman Wheeler went on to insist that ensuring “the Internet exists as a collection of open, interconnected facilities is a highly appropriate subject” for federal regulators. An IP transition from traditional telephone to broadband networks that enables competition simply won’t be able to occur if competitors are unable to interconnect in areas where there is legacy market power. In addition to physical interconnection of Internet Protocol (IP) networks, to make the IP transition successful, voice traffic needs to be exchanged in an IP format (Session Initiation Protocol, or SIP, format). All incumbent telephone providers need to begin exchanging their traffic in native SIP formats. Interconnection has been a huge public interest concern for at least a hundred years and was a main tenant of the 1913 Kingsbury Commitment. Rules governing the ability of a caller who uses one service provider to be connected with the subscriber of another carrier were also put in place both as part of the 1934 Communications Act and the 1996 Telecommunications Act. Without these rules, large providers would rule the market and competition would be severely impaired. In 2012, the FCC’s Technological Advisory Council (TAC) examined the issue of VoIP interconnection and concluded that, although “VoIP Interconnect[ion] is happening all over the world, at a rapid rate,” implementation in the United States has been “delayed” aside from the efforts of some cable companies and competitive local exchange carriers (CLECs). AT&T instigated a firestorm with non-incumbent carriers as well as industry stakeholders when it stated to the FCC that legacy rules should be removed as part of any IP transition. While incumbent providers like AT&T might argue the system can continue using voluntary agreements between parties, smaller carriers, advocates and some state regulators have significant concerns about such a system. A blog post by Kathleen Ham, T-Mobile’s Vice President of Federal Regulatory Affairs, summed up the feelings of many on the topic: “Because no telecommunications network can stand entirely on its own – on the simplest level, one carrier’s customer must be able to call another carrier’s customer – deregulating, as these largest carriers suggest, would be devastating to competition and consumers. It would also undermine the very efficiency and reliability purposes of converting to 21st century technology.” The importance of interconnection was also raised during a July 2013 Senate Commerce, Science, and Transportation Committee hearing, where several of those testifying said it is essential that callers be able to contact each other regardless of provider or technology. Absent that, the nation’s communication system in the age of IP-to-IP calls would fail. “As the PSTN transitions to new physical facilities and IP protocols, it is critical to the competitive future of the market that the law and rules ensure carriers will continue to interconnect and rules will continue to promote competition in the marketplace to the benefit of consumers,” stated Gigi Sohn, then Public Knowledge’s President and Chief Executive Officer in her Senate testimony. Those representing vulnerable populations agreed. “If there is no requirement to interconnect with a network, then a small provider can’t connect with a larger provider,” said Edyael Casaperalta of the Center for Rural Strategies. “Interconnection and competition go hand-in-hand because you need to make sure policies encourage competition.” Interconnection, observed amalia deloney of the Center for Media Justice, ensures that everyone will be able to communicate and participate in society. “This is a vital infrastructure, like water, like roads and electricity,” she said. One way to solve the issue would be to declare voice-over-IP a telecommunications service. John Burke, a member of Vermont’s Public Service Board and chairman of the National Association of Regulatory Utility Commissioners’ committee on telecommunications, urged the FCC to do so and bring regulatory certainty to the issue instead of moving forward with trials. “An FCC-blessed ‘real-world VoIP interconnection trial’ will not help the Commission clarify the statutory basis for incumbent LECs’ [local exchange carriers’] duty to provide VoIP interconnection,” he testified during an October 2013 House subcommittee hearing. “That clarification begins and ends with an interpretation of the statute.” Interconnection is one of 10 interrelated principles for a successful IP transition identified in our new report, The New Network Compact: Making the IP Transition Work for Vulnerable Communities. In previous posts, we've looked at Ubiquity, Accessibility, Diversity, Openness, and Competition. We'll look more closely at our additional principles later this week.