Industry on hold for CRTC VoIP decision

Recent decisions in the U.S. regarding the regulation of voice over Internet protocol have renewed urgent calls from Canadian industry for Ottawa to get its act together.

Also fueling the fire on this side of the border are recent introductions of Internet-based phone services, such as

Rogers Communications Inc.’s decision to employ Internet-based standards in its new telephone service offering. The service is set to hit Toronto and its suburbs by 2005.

The U.S. Federal Communications Commission (FCC) is now making lasting regulatory decisions concerning VoIP. Last week, the commission approved a request from VoIP provider to be exempt from the long list of government rules, taxes and requirements that apply to traditional telephony.

In the split decision, FCC Chairman Michael Powell said Pulver’s software application, Free World Dialup, is “”in no way different than e-mail and other peer-to-peer applications (that are) blossoming on the Internet.”” And such services have never been bound by telecom services, Powell added.

The decision leads the FCC one step closer to making a decision on those VoIP services that allow calls to be placed from a personal computer over a broadband connection to any phone number in the world.

So why does the Canadian Radio-television and Telecommunications Commission appear to be ignoring this monumental change? That question is on the mind of Lawson Hunter, executive vice-president of regulatory affairs at Montreal-based BCE. He said Bell is “”anxious”” to know whether the CRTC plans to clarify any regulations that might apply to VoIP.

Bell has an increasing stake in the VoIP market as it works on a service for home and small business customers. The phone giant has already announced its intention to transfer its entire core network to the Internet in the next couple of years.

Lawrence Surtees director, telecommunications and Internet research at IDC Canada, echoed Hunter’s urgent calls for regulatory action.

“”It’s a real hornet’s nest, and there’s a big need for clarity from the (government) on (VoIP),”” he said. “”Everyday there’s a growing need to deal with these issues. Time’s a wasting. Traditional definitions of (telecom service delivery) are getting blown away.””

Philippe Tousignant, a spokesman for CRTC, admitted that while the commission has ruled the Internet is a telecom service, the use of VoIP raises “”many questions.””

But “”saying there are questions means we should know if there are answers,”” argued Hunter.

Tousignant said the CRTC will continue to be neutral in the type of technology carriers use to deliver telecom services. “”Whether (carriers) use circuit switching, voice over cable, or voice over whatever . . . whatever the technology that’s behind it is not really compelling for us.””

However, Tousignant suggested the unique questions raised by VoIP could prompt the CRTC to make regulatory considerations on a “”case-by-case basis”” depending on the nature of the VoIP service offering.

Whether the CRTC will follow the FCC’s lead should not be an automatic assumption, added Tousignant. “”It’s certainly an argument people can put to us, but to say that it would be automatic is not necessarily true.””

“”We do follow what’s happening in the U.S. . . . from a distance. We have a different mandate, jurisdictions and different acts (than the FCC). So we adopt policies that are in conformity with our acts and objectives as opposed to what’s going on in the U.S.””

At a recent address in Banff, Alberta, CRTC Chair Charles Dalfen suggested all the facts must be weighed before any regulatory decisions are made in Canada regarding VoIP.

Bell has urged the CRTC to be more specific in its direction. Last November, it requested the commission launch a public review that addresses the “”rules governing the provision of telecommunications services by cable companies and others using VoIP technology.””

Surtees warned any delay by the CRTC will result in a lack of clarity, leaving VoIP providers with the impression that they aren’t regulated at all. A perceived “”two-tier”” system could leave VoIP providers with the false impression that they have a huge competitive advantage over traditional telecom service providers, he added.

“”The larger question is: When local, data, Internet, and long-distance converge on an IT platform, what are those services?”” asked Surtees. And do you regulate the current and upcoming VoIP offerings as cable, telecom, do you treat it as IP, or do you regulate that at all? he said.

“”Someone might laugh at me and say ‘Who cares?’ I say, ‘Hold it, that’s how we measure markets, that’s how we set rules and that’s how we as a society and government determine levels of competition and what rules should apply.’ That’s what these issue proceedings have to look at. We can’t ignore the consequences.””


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