Begin forwarded message:
From: Stan Hanks <stan@xxxxxxxxxxxxxxx>
Date: June 21, 2006 1:37:44 PM EDT
To: dave@xxxxxxxxxx
Subject: Internet Phone Providers Must Pay Government Fees, FCC Says
I personally find no surprise in this. I have long maintained -- and
advised clients and portfolio companies alike -- that The Powers
That Be
were going to apply the "duck test" to VoIP-based telephone companies.
That is, if it looks like a duck, it swims like a duck and it quacks
like a duck, then by gosh it must BE a duck!
Once you start offering direct inbound dial phone service with "real
phone numbers", and you're connected to the rest of the public
switched
telephone network, you *ARE* a "telephone company" under any
reasonable
interpretation and as such should be subject to the same rules and
proceedings to which any other telephone company is subject. Whether
your transmit signals over copper plant that you've owned since the
1800s or via broadband wireless using VoIP is irrelevant.
That said, as long as you're operating in your own "island of
connectivity", you should be completely free to do whatever the
heck it
is that you want to do without interference from the FCC or any other
regulatory body. The problem is, under that scenario, you have a
really,
really hard time talking to anyone outside your little world.
Stan
---------
Internet Phone Providers Must Pay Government Fees, FCC Says
2006-06-21 12:16 (New York)
By Molly Peterson
June 21 (Bloomberg) -- Vonage Holdings Corp. and other
providers of
Internet-based telephone service must help subsidize services in rural
and low-income areas, U.S.
regulators said.
A rule adopted today by the Federal Communications Commission
requires providers of voice-over Internet protocol, or VOIP,
service to
contribute 10.5 percent of their long- distance revenue to the
Universal
Service Fund if the calls pass through traditional phone networks.
Mobile-phone companies such as Cingular Wireless LLC may have to pay
more as well.
``We take these actions because we recognize the changing
telecommunications marketplace,'' FCC Chairman Kevin Martin said
during
a meeting today. The rule is an interim measure that will help
maintain
the stability of the fund while the commission works to create a
long-term, ``technology-neutral'' contribution system, Martin told
reporters after the meeting.
The rule, approved unanimously, is part of an FCC effort to
restructure the U.S. Universal Service program. It is funded by
long-distance surcharges and the revenue base has declined in recent
years as calling costs have dropped and competition has increased. The
program also funds Internet access in schools and libraries.
The FCC now requires established carriers such as AT&T Inc.
and Verizon Communications Inc. and mobile-service companies including
Cingular Wireless LLC to pay 10.9 percent of long- distance revenue
into
the fund. The contribution for all carriers is scheduled drop to 10.5
percent on July 1. The companies say Web-based providers shouldn't be
exempt.
The new rule requires Internet-phone companies to pay Universal
Service fees on as much as 64.9 percent of their revenue. The rule
also
increases, from 28.5 percent to 37.1 percent, the maximum amount of
mobile-phone revenue that is subject to the tax. The rule won't change
the methods for calculating traditional carriers' contributions.
--Editor: Golum (tlb)
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