Work Begins Writing Net Phone Rules

Now begins the work on how or even whether to write rules for Internet telephony, with the Federal Communications Commission set to consider a so-called notice of proposed rulemaking Feb. 12, while also preparing for a final decision on whether a new Internet phone provider needs to pay interconnection access fees to telephone companies for any phone calls between Internet-tied computers.

The New York Times said Feb. 8 that a ruling in Pulver.com's favor won't make an immediate impact on Net telephony "because there are so few Internet phone users." But the paper cited Legg Mason analyst Blair Levin as saying a favorable Pulver ruling would have a big effect if someone like Microsoft decided to offer computer-to-computer telephony.

"The (FCC) scheduled this week's proceedings after the Justice Department reversed its earlier position that anything less than stringent regulations would pose legal and technical obstacles to the ability of law enforcement agencies to do wiretapping for criminal and terrorism investigations," the Times said. "Entrepreneurs and optimists, along with companies like AT&T and Verizon Communications, say that Internet-based telephony could revolutionize the telecommunications industry."

But first, the paper said, Washington has to decide how or even whether to regulate the new technology, and obstacles remain many enough, "because although Internet phone service represents a technological convergence of communications and computers, the regulatory world remains neatly divided: different rules apply to phones, cable, wireless services and data transmission."

The FCC regulatory proceedings on Net telephony are expected to take several months or even longer to finish, possibly beyond the term of chairman Michael K. Powell, who usually favors the deregulatory approach. Among the questions those proceedings are likely to address: whether traditional telephone companies "migrate to the new technology to get relief from telephone regulations that they maintain are overly burdensome," the Times said.