Federal Initiatives Favor The Migration To VoIP Telephony

Federal Initiatives Favor The Migration To VoIP Telephony

Voice over Internet Protocol, or VoIP as it has come to be called was a tough call for legislators in charge of figuring out how to apply rules and regulations. There were questions raised as to whether it was an 'information service' or not. Phone companies had been developing rapidly over the past decade, with the original analog public switched telephone network making the move to digital and wireless transmission. The Internet provided a whole new way to transfer voice calls, and is causing a dilemma that is taking the FCC years to resolve.

Hosted VoIP providers were concerned over the possibility of being charge access fees by standard carriers. The FCC ruled however, that any compensation between PSTN networks and VoIP companies would be reciprocal. This means that calls placed on one network and terminated on another will often cancel each other out - saving VoIP customers from having hefty charges passed down and relieving VoIP providers from having to charge high per minute rates.

The FCC's ruling is at federal level, meaning individual state laws concerning access charges won't apply - since either access charges or reciprocal compensation can be accrued but not both, VoIP services are off the hook. This means hosted VoIP will become even more widespread, and that regular telephone service providers will be forced to become more competitive to compete.

The FCC ruled that the federal government, not individual states could govern VoIP and broadband services back in 2004. At that time a dispute arose concerning regulation and taxing of such services - individual states make profits off of taxes for landline phone connections, and feared losing a hefty portion of their revenue stream to 'upstart' companies that depended on broadband service to relay voice calls.

The latest ruling cements the lead hosted VoIP has on the rest of the industry, and may sound the death knell for legacy telephony. With the possibility of 'white space' being opened up, Internet based communication may become even less expensive, and the migration to VoIP will become the standard.