Telecom Regulation for IP-Based Providers: 6 Need-to-Know Facts

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1 1 Telecom Regulation for IP-Based Providers: 6 Need-to-Know Facts

2 Telecom Regulation: 6 Need-to-Know Facts for IP-based Communication Providers The disruptive nature of IP telephony continues to create challenges for both federal and state level regulators. If you provide IP-based communication services like interconnected VoIP, mobile VoIP or other over-the-top (OTT) voice applications, and haven t been paying attention to the regulatory landscape, now is the time to start. Here are 6 facts you should know about telecom regulation. 2

3 1 Providers of IP-based communication services are likely to experience increased regulatory scrutiny. Starting with the rise of the telegraph and continuing to today, the telecom industry has always been heavily regulated. By the close of 2010, the FCC reported 30 percent of the nation s 87 million residential phone lines were VoIP numbers. Since that percentage is expected to grow, regulators have been working to understand the implications this shift brings to existing regulations. It is reasonable to assume that increased regulatory scrutiny of the companies providing IP-based communication services will occur in the coming months and years. 3

4 2 Future regulatory decisions concerning IP network interconnection could be beneficial or detrimental to your business. How to manage IP network interconnection, the linking of next generation networks for the mutual exchange of traffic while fostering a competitive telecommunications environment, is a hotly contested issue. Rules covering how the interconnection of IP to-ip and IP to the public switched telephone network (PSTN) could dramatically affect the growth prospects for some IP-based communication providers businesses. 4

5 3 A clear definition of the precise services and providers subject to regulation remains nebulous. When it comes to IP communications, currently only interconnected VoIP providers are required to support The FCC defines interconnected VoIP as services that: Enable real-time, two-way voice communications Require a broadband connection from the user s location Require IP-compatible CPE Permit users generally to receive calls that originate on the PSTN and to terminate calls to the PSTN As the industry continues to evolve, the FCC will continue to consider broadening or revising which categories of services to include under regulations, such as one-way VoIP (e.g. traditional Skypeout service). 5

6 4 The list of regulatory compliance obligations applying to interconnected VoIP providers remains long. Sure there is the obligation, but Interconnected VoIP service providers must also comply with nearly an identical slate of responsibilities as their circuit-switched brethren, including: Contributing to the Federal Universal Service Fund (FUSF) Compliance with disability access obligations (TRS/VRS) Support for lawful intercepts and records production under the Communications Assistance for Law Enforcement Act (CALEA) Local number portability ( LNP ) Regulatory fees like 911 and TRS Service Outage reporting 6

7 5 Intercarrier compensation rules continue to evolve as the FCC works to implement the National Broadband Plan. On November 18, 2011, the FCC issued an order implementing major reforms in the USF and intercarrier compensation ( ICC ) rules to ensure that robust, affordable voice and broadband service, both fixed and mobile, are available to Americans throughout the nation. Proponents for ICC reform, including Bandwidth, agree that the intercarrier compensation system is outdated. Because ICC is fundamentally premised upon the concept of long distance toll traffic carried by IXCs that charge per-minute charges, today s ICC system is ill suited for an ever-expanding list of wireless and IP-based communications options. Bandwidth is an active participant in the industry reform efforts, and is focused on aligning its services with the changing ICC regulatory landscape. 7

8 6 Regulators are actively contemplating the best ways to support text-to With text-to-9-1-1, people in need of emergency assistance gain an additional and potentially life-saving option for requesting help from first responders. Public safety officials agree that textto would provide needed assistance to speech- and hearing-impaired citizens, as well as to those whose safety could be jeopardized by speaking under duress. Furthermore, through increasing adoption of texting services, consumers generally have indicated a demand for textto-911 support. In response, the FCC is actively sponsoring service innovation while also protecting consumers with targeted solutions for text-to right now. In fact, soon both wireless and OTT texting providers will be required to notify end-users with bounce back messages that text-to-911 service is unavailable if the provider has not enabled its support in a given service area where attempted text-to-911 messages are sent. 8

9 Conclusion The broad transition to IP networks and their feature-rich set of services is one of the greatest technological developments of the last century. Policy and regulatory debates continue to play a critical role in how providers can expect to operate. As an industry leader, Bandwidth has unsurpassed expertise and sought-after experts who are actively involved in the regulatory evolution. Please contact us with questions, or if you d like more information about how telecom regulations may impact your business. Contact us or visit our Resource Center for more information. For more information:

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