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Federal regulation of VoIP is crucial, FCC leader says – Michael Powell aims to avoid tangle of state rules.

October 20, 2004 /

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FCC Chairman Michael Powell said yesterday that he would seek broad regulatory authority for the federal government over Internet-based telephone services to avoid stifling the emerging market.

By MARK JEWELL
The Associated Press

http://seattletimes.nwsource.com/html/businesstechnology/2002067568_fccvoip20.html

(Thanks to Lou Fontana for passing this along- Russ)

Powell told a receptive audience at an industry conference that letting states regulate Voice over Internet Protocol, or VoIP, services would lead to a patchwork of conflicting rules like those that have ensnarled the traditional phone business for decades.

To do so, Powell said, "is to dumb-down the Internet back to the limited vision of government officials. That would be a tragedy."

After his speech, Powell said he expected to introduce a proposal to the full Federal Communications Commission before a new Congress begins its session in January.

"We cannot avoid this question any longer," he said. "It is very likely that treatment of VoIP will have some of the farthest-reaching consequences of anything this commission has done or will do."

Powell cited a study by a research firm, The Yankee Group, that projects 1 million VoIP subscribers nationwide by year’s end, compared with 131,000 last year.

While some issues involving voice quality and consumer accessibility remain to be worked out, VoIP service could overtake landline services by piggybacking on the existing, low-cost technology platform used for the Internet.

The technology "has ignited a fire under a stalled and depressed industry," Powell said, referring to traditional landline phone carriers.

Powell said questions of its taxation and connectivity to 911 emergency assistance are best left to the federal government because the technology erodes geographic barriers.

Such barriers have led to a complex framework of regulations governing local and long-distance service for traditional landline phones.