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Vonage Fights Minnesota's Attempts To Regulate VoIP

timothy posted more than 11 years ago | from the buggy-whip-makers-tense dept.

The Internet 200

rmccoy writes "Vonage said Thursday it intends to fight the first-ever decision by a U.S. state to regulate companies that provide Internet-based phone services. Minnesota's Public Utilities Commission unanimously decided two weeks ago that the New Jersey-based voice over IP (VoIP) provider is subject to the rules and regulations that cover traditional phone companies."

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fp (-1, Offtopic)

Anonymous Coward | more than 11 years ago | (#6774209)

first post bitches. linux r teh sux

I'd think this would be a federal matter (3, Insightful)

Anonymous Coward | more than 11 years ago | (#6774210)

Seeing how they're dealing with interstate communication.

Re:I'd think this would be a federal matter (0)

Anonymous Coward | more than 11 years ago | (#6774366)

/me me yells across the state line

Can you hear me now? Telephone Excise Tax applies!

Re:I'd think this would be a federal matter (0, Offtopic)

brokencomputer (695672) | more than 11 years ago | (#6774407)

Also, this will make it better for customers by regulating the equipment so that devices are not proprietery for each company. This is actually a very good thing to be regulated.

Re:I'd think this would be a federal matter (1)

brokencomputer (695672) | more than 11 years ago | (#6774520)

oops i should have read the article and the parents subject line. Sorry about that.

Re:I'd think this would be a federal matter (3, Informative)

Bull999999 (652264) | more than 11 years ago | (#6774596)

It is. Vonage will win because according to the U.S. Constitution, only Congress can pass the law regulating inter state commerce.

Isn't it awesome (1, Insightful)

Anonymous Coward | more than 11 years ago | (#6774216)

When regulations there to protect the consumer do nothing at all to stop the one single incumbent provider but effectively eviscerate anyone attempting to provide the consumers choice or innovation?

I hate american "capitalism". (If for some reason you want to call it that)

Re:Isn't it awesome (0, Flamebait)

Eric Ass Raymond (662593) | more than 11 years ago | (#6774231)

In Europe the VoiP will be most likely banned because it cannot be regulated by the government (who is, of course, supposed to protect the consumer). So get off your high horse.

Re:Isn't it awesome (0, Offtopic)

DavidinAla (639952) | more than 11 years ago | (#6774524)

Unfortunately, we don't HAVE capitalism in the United States. We have an economy that is controlled more and more by various levels of government. The trappings of economic freedom are still there, but government controls things to a greater and greater degree with both carrots and sticks. It's a system that forces companies and individuals to be dishonest in order to survive. When it suits the purpose of government, bits and pieces of that dishonesty are exposed and punished. This system keeps the power in the hands of government and away from private citizens or companies that don't play the political game.

post (-1, Offtopic)

Anonymous Coward | more than 11 years ago | (#6774217)

hi this is a post. it's true!

Re:post (0)

Anonymous Coward | more than 11 years ago | (#6774230)

this isn't offtopic! by "it's true" i meant that the facts in the article are accurate.

Rimjobs (-1, Offtopic)

Anonymous Coward | more than 11 years ago | (#6774221)

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Please stand in line for the privilege of getting to please me.

Re:Rimjobs (-1, Flamebait)

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Re:Rimjobs (-1, Flamebait)

Anonymous Coward | more than 11 years ago | (#6774241)

And just who do you think you are?

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Re:Rimjobs (0)

Anonymous Coward | more than 11 years ago | (#6774273)

Oh you flatter me. No, I'm just your average /. reading open source advocate.

Fair enough, no? (3, Insightful)

mindstrm (20013) | more than 11 years ago | (#6774223)

I mean, this isn't about just "voice over internet".... it's about a phone service that happens to use the net.

So... either they should have to follow regulations like any other phone company..... OR... the phone companies should be released from their regulatory obligations, at least with respect to the voip providers, so they can operate on equal footing.

Re:Fair enough, no? (4, Insightful)

The Uninformed (107798) | more than 11 years ago | (#6774254)

Not really, the big users of VoIP are buisnesses with T1/T3 lines and individuals with cable/DSL who make long distance calls.
The state shouldn't be regulating this.

Re:Fair enough, no? (2, Insightful)

brokencomputer (695672) | more than 11 years ago | (#6774429)

Your comment doesnt make sense. T1 lines are regulated by the gov(at least the voice part of them is i should say) and cable is regulated. Even so that doesnt have anything to do with deciding if they are regulated. Regulation will make it better for consumers by standardizing equipment and standards.

Re:Fair enough, no? (3, Insightful)

The Uninformed (107798) | more than 11 years ago | (#6774508)

Hmm... after reading deeper it looks like Vonage is advertising it as a replacement for local calls as well. And they're advertising it as a telephone service.
So I was wrong, the state isn't off base here. Vonage is just using that fact that it's not analog to avoid regulations. (and some 911 fees)

Re:Fair enough, no? (1)

smitty_one_each (243267) | more than 11 years ago | (#6774434)

I don't know. Looking at the ridiculous bills for land- and cell-phones I've been getting lately, it seems that the government is picking the consumer pocket at all levels.
I'd estimate that the overall government take in the US is ~="A LOT".
Gray Davis's hair would only get greyer if California's revenue due to long distance charges vanished in an abstract puff of packets.

Re:Fair enough, no? (1)

TyrranzzX (617713) | more than 11 years ago | (#6774725)

I'v got teamspeak 2. As far as Illinois is conserned, they can kill my ass.

Re:Fair enough, no? (1, Insightful)

Arker (91948) | more than 11 years ago | (#6774292)

Regulation has sure done a lot of good for the regular phone companies eh?

VoIP is a chance to get around the stifling regulations that have turned telephone service into a form of corporate welfare for campaign contributors, and to create a market that will serve the consumer again.

Of course the regulators are going to try and screw it up.

Nope. Software Service != Local Copper Monopoly (4, Insightful)

FreeUser (11483) | more than 11 years ago | (#6774319)

I mean, this isn't about just "voice over internet".... it's about a phone service that happens to use the net.

So... either they should have to follow regulations like any other phone company..... OR... the phone companies should be released from their regulatory obligations, at least with respect to the voip providers, so they can operate on equal footing.


You ignore a fundamental difference. Local telcos own a monopoly over the local copper cable running to people's homes. As a monopoly they must be regulated, nationalized into a public works, or we are left with a monopoly market running amock (remember, monopoly markets are the least effecient ... even more ineffecient than government and arguably more ineffecient than communism itself).

There is a huge difference between a company that essentially offers a software (or firmware) service over the internet that happens to transmit and receive electrically encoded voice data, and one which owns the local DSLAMS, the local copper running into your home, and can leverage that local infrastructure monopoly in an anticompetative manner if they are not regulated.

The idea that the regulations designed to hold a local telco monopoly in check should apply to a competely unrelated business that provides what is essentially a software service via an entirely different infrastructure (one that entails no monopoly, at that) is ludricous.

One hopes the law is written such that (a) this is a federal, not a state matter and (b) such that telco's are targeted, and broader software services are not.

Otherwise you'll see AIM, MSN Messenger, Jabber, and other services targeted the moment they can provide audio and video conferencing, and seamless communication with old POTS phones.

And that would really chill innovation, as much as any Microsoft monopoly could ever dream of.

Re:Nope. Software Service != Local Copper Monopoly (0)

Anonymous Coward | more than 11 years ago | (#6774920)

State PUC's don't only create regulations as a way to collect tax revenue, they also ensure minimal levels of service is provided to customers, such as call clarity and 911 availibility. What happens when a call to 911 fails on the traditional system? In most cases, the phone company faces state fines and civil lawsuits. The RBOCs are forced to take considerable measures to ensure the system is as reliable as possible. What would happen if a 911 call through the Vonage system were to fail? Possibly nothing since the regulations that apply to the traditional service providers "doesn't apply here". The state of Minnesota is doing what it believes is necessary to ensure service levels are not sacrificed. It's about social responsibility.

Some may argue that Vonage is not a traditional phone company and the regualtions of the traditional system should not apply. But the fact of the matter is that Vonage markets itself as a phone service provider. Now they need to act like one.

No, not fair enough (3, Interesting)

Spy Hunter (317220) | more than 11 years ago | (#6774335)

The phone company regulations have been written over the years to apply very specifically to companies that provide a switched copper wiring network densely covering a large geographical area, and now they want to apply them to companies that provide voice service over the Internet, and this is fair?!?

It is rediculous to assume that because the service VoIP companies provide to consumers is similar to the service phone companies provide to consumers, the same regulations will work to govern them. In fact, why should VoIP be subject to regulation at all? The only reason I can think of is: if it is not regulated, it has the potential to destroy the market for traditional switched land-line service. But the question we should be asking is, is that a bad thing? Shouldn't we be moving toward a model where phone companies transform into bandwidth providers and voice communication service is provided over the same connection as everything else?

Re:No, not fair enough (2, Interesting)

bev_tech_rob (313485) | more than 11 years ago | (#6774413)

...Shouldn't we be moving toward a model where phone companies transform into bandwidth providers and voice communication service is provided over the same connection as everything else?...

That is what John Dvorak thinks should happen.. I would think it would relieve the phone companies of a lot of headaches...see this PCMag article [pcmag.com] for his take on this matter...

All I am saying (1)

mindstrm (20013) | more than 11 years ago | (#6774415)

is let them be on equal footing. I'm not suggesting de-regulating the phone company.. just those aspects that compete directly with vonage offering voip service.

I'm not suggesting regulating vonage at all.. I'm suggesting that on some level what vonage is offering is the same as what the telco is offering, and therefore, they should fall under the same regulation with regards to that particular service.. and that very well may mean no regulation.. ie: let the traditional telco be flexible with it's local offerings as well.

Re:All I am saying (4, Insightful)

Spy Hunter (317220) | more than 11 years ago | (#6774561)

I'm suggesting that on some level what vonage is offering is the same as what the telco is offering

I think the problem is that the phone companies are actually offering two things: the physical network infrastructure, and phone service. The regulations for both are intertwined since they have historically been equivalent, but now one can be offered without the other. Minnesota is trying to apply their combined regulations to a company that is only offering the phone service, and that is just dumb. So we agree that Minnesota's decision is dumb. What is really needed is for separate regulations to apply for phone service and network providers. Traditional phone companies should be subject to both, and Vonage should be subject only to the phone service ones. Also, we agree that existing phone service regulations are probably impractical in a world where phone service is provided over the Internet and they probably need changing (perhaps to the point of abolishing them entirely).

Re:Fair enough, no? (3, Interesting)

frovingslosh (582462) | more than 11 years ago | (#6774462)

I mean, this isn't about just "voice over internet".... it's about a phone service that happens to use the net.

Just the opposite. It's about data, and it's none of the state's business what my data is or what protocol I wrap it in. If they can regulate VoIP data then they could also regulate you capturing a wave file of your voice and sending it by FTP or as e-mail to a friend. And if they can do that then they might as well stick their fingers into everything you send or even everything you do with your computer.

That's John Ashcroft and Homeland Security and Echelon's job, to snoop into every single corner of your life, not the state government's.

Re:Fair enough, no? (1)

Dark Nexus (172808) | more than 11 years ago | (#6774580)

ALmost fair enough.

Yes, several of the regulations should apply to both, but I suspect that there are also regulations that are related more to the transmission methods, rather than what the service is.

Honestly, VoIP should probably have it's own set of regulations in parallel with the regulations that the standard telcos have to follow.

Re:Fair enough, no? (0)

Anonymous Coward | more than 11 years ago | (#6775083)

You want to know the REAL REASON that states will be looking into regulating VoIP?

TAXES TAXES TAXES TAXES TAXES.

That's it, otherwise they have no other reason to give a crap about what people do over the internet.

This seems fair (2, Insightful)

Electrum (94638) | more than 11 years ago | (#6774229)

This seems fair. They are providing phone service that connects with the regular phone network, so why shouldn't they be treated like a traditional phone company?

gay (-1, Offtopic)

Anonymous Coward | more than 11 years ago | (#6774242)

Re:gay (-1, Troll)

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Re:gay (-1, Troll)

Anonymous Coward | more than 11 years ago | (#6774287)

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Re:gay (-1, Troll)

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Not quite the same (4, Insightful)

cperciva (102828) | more than 11 years ago | (#6774244)

While VoIP (or at least, VoIP-connected-to-the-standard-telco-system) is pretty much the same as normal phone service, trying to apply exactly the same regulations isn't going to work.

For example, phone companies are supposed to track where phone calls originate (for 911 dispatchers, for example). That's not going to be possible with VoIP.

There should certainly be some sort of regulations, but simply saying "it's phone service, the same rules apply" is dumb.

Re:Not quite the same (2, Informative)

phunhippy (86447) | more than 11 years ago | (#6774256)

For example, phone companies are supposed to track where phone calls originate (for 911 dispatchers, for example). That's not going to be possible with VoIP.

you sir are wrong.. In fact Vonage offers a 911 service when you sign up these days.

This will probably happen in more states as well they are offering home service. Eventually long-haul carriers like ITXC & IBAS will have to face these problems as well.

Re:Not quite the same (2, Informative)

an_mo (175299) | more than 11 years ago | (#6774266)

did you even read the parent post? HE's saying that they can trace origination, not that they can't offer 911 service

Re:Not quite the same (5, Informative)

rusty0101 (565565) | more than 11 years ago | (#6774303)

Technically the hard wired phone companies can't trace a call origination either. If you go to a line bridge (pedestal or arial) and find dial tone, then patch that to your own pair of wires into your house, there is no way for the phone company to determine where a phone call originating on that line actually came from.

Note that this is tampering with phone company equipment which I believe is considered a felony, but that doesn't change the fact that unless a phone company rep goes to that bridge and finds the wires attached, they don't know where the call came from.

Additionally the dial tone that that line carries may be on bridge tap for a line that is not even in the neighborhood you live on. So knowing that the call originated on phone line 218-555-1111 does not tell you that the call originated at the billing address for that line. It tells you that it probably came from that address. Fortunately we do not have that many people stealing phone service.

The way that 911 works, regardless of whether it is provided by a VoIP provider or the phone company, is that the phone number and service address are forwarded to the 911 operator by the appropriate service provider.

-Rusty

p.s. Yes I have worked for the phone company, though I do not do so now. I also happen to use Vonage and live in the state of Minnesota, so I very possibly will be affected.

Re:Not quite the same (-1, Flamebait)

Anonymous Coward | more than 11 years ago | (#6774278)

You are an idiot.

Re:Not quite the same (0)

Anonymous Coward | more than 11 years ago | (#6774316)

For example, phone companies are supposed to track where phone calls originate (for 911 dispatchers, for example). That's not going to be possible with VoIP.
Actually, yes, this is going to be possible:
http://www1.cs.columbia.edu/~knarig/e911.ppt

Re:Not quite the same (-1, Flamebait)

Anonymous Coward | more than 11 years ago | (#6774468)

Ah, c'mon. Power Point? WTF?

Frequently it is preferable simply to link to the source of your information, but there are limits to what I'll click. When it's a god-damned Power Point presentation, so you might as well explain it.

Re:Not quite the same (1)

rusty0101 (565565) | more than 11 years ago | (#6774332)

As I noted further down the response thread, the way that the local phone company provides the call origination information for 911 is to provide the service location for the phone number in question. (Land-line service only. Cell service provides approximate or estimated location by tower signal strength when possible)

Someone stealing service by tapping into your phone line off some bridge tap elsewhere in your telco provider area, who then dials 911 will be reported as your address, even though he or she may be across town. It doesn't happen often, so it causes major problems when it does happen.

Your phone company, (local carrier, VoIP carrier, or VoCable provider) sends the service address for the phone number you originate your call from to the 911 operator if you place a 911 call.

As long as you keep your VoIP equipment at that street address, it will be reported properly. If you happen to take the equipment with you between home and work, or drive around and use open WiFi access points to place calls, then whomever is at the address you provided as a Service address is probably going to be bothered if you call up 911.

-Rusty

Sucks... (4, Informative)

Superfreaker (581067) | more than 11 years ago | (#6774248)

I use vonage as a replacement for my house line. I added a second vonage number for faxing and it works perfectly (except during the blackout).

I have a feeling that many of the things that make this service cool could be affected by this.
Like:
- Being able to have a number in any area code regardless of where you live
- Being able to plug your phone into any broadband line anywhere and have the same number you have at home.

Those are key and I can see them being screwed by this type of regulation.

Re:Sucks... (1)

mrseigen (518390) | more than 11 years ago | (#6774276)

It's the standard thing whenever big telco gets interested in a technology, they move in, release a version of the tech that's been "user-friendlied" (read: less of the cool features) and then after awhile, nobody misses those cool features because the guys who had them went under.

Re:Sucks... (1)

mcrbids (148650) | more than 11 years ago | (#6774441)

I added a second vonage number for faxing and it works perfectly (except during the blackout).

This is precisely why treating a VOIP line like a phone line won't work. Telephones are on their own independent circuit and so have advantages for emergencies. VOIP is no more regulatable for telecommunications than SPAM is.

Some people just don't have a clue.

-Ben

I hope they win. (5, Interesting)

H0NGK0NGPH00EY (210370) | more than 11 years ago | (#6774252)

I'm a satisfied Vonage customer, and I have to say that I really enjoy having a "phone bill" that is completely straight forward. I'm on the $25.99/month plan, and our monthly bill contains less than $1 in taxes. LESS THAN A FREAKING DOLLAR. How cool is that?

If the government starts getting their fingers in this business that is doing just fine competitively, you can bet that I'll start to see loads of fees and taxes being added onto my bill, turning my $27.00 monthly bill into something more like $40.00. And for what benefits? None.

Go Vonage.

Shameless refer-a-friend link to Vonage [vonage.com]

Re:I hope they win. (0)

Anonymous Coward | more than 11 years ago | (#6774281)

If the government starts getting their fingers in this business that is doing just fine competitively, you can bet that I'll start to see loads of fees and taxes being added onto my bill

Which is exactly why the government will be regulating this business. Unless all those tax dollars from capital gains and dividends start flowing back. They won't win.

Re:I hope they win. (0)

Anonymous Coward | more than 11 years ago | (#6774330)

...you can bet that I'll start to see loads of fees and taxes being added onto my bill, turning my $27.00 monthly bill into something more like $40.00. And for what benefits? None.

Perhaps national defense? Education? Roads? Social services? There is a reason we pay taxes in this country.

Re:I hope they win. (4, Insightful)

krem81 (578167) | more than 11 years ago | (#6774390)

That's what the INCOME taxes are for. Both Vonage and its customers pay income taxes. There's not need to add fees associated specifically with land-line carriers to a Vonage bill.

Re:I hope they win. (4, Insightful)

number11 (129686) | more than 11 years ago | (#6774456)

If the government starts getting their fingers in this business that is doing just fine competitively, you can bet that I'll start to see loads of fees and taxes being added onto my bill, turning my $27.00 monthly bill into something more like $40.00. And for what benefits? None.

Actually, there are benefits, at least for some of it. We need to pay somehow for 911 service, service for schools, libraries, hospitals, the deaf. (I won't attempt to defend the massive subsidies for service to people who choose to live in the boondocks, including the entire population of the State of Alaska, or the replacement profits to compensate local telcos for the loss of the LD gravy.) The problem is, those things should just be paid for out of general revenues (income taxes, etc.). But politicians who pander to the "get rid of taxes" yahoos look for ways to hide the taxes somewhere else, and this is what we get. (No disrespect for Yahoo!, Inc. intended, but they knew the word meant "boorish, crass, or stupid person" when they adopted it as their corporate name.)

Re:I hope they win. (4, Insightful)

petermcanulty (140720) | more than 11 years ago | (#6775059)

Just to point out that most people with phone-service in "the boondocks" are rural, and most of those people are involved with providing the rest of us leeches with our food. If they all move away from "the boondocks", we starve.

Not good.

peter

Re:I hope they win. (0, Flamebait)

zulux (112259) | more than 11 years ago | (#6774686)

And for what benefits? None.

Alot of those taxes go for two things:

1) Subsudising phone service for deadbeats who won't get a job.
2) Subsudising phone service for rich people who want a trophy house in the middle of nowhere.

As far as I'm concerned, we shouldent have to subsudise either group. Instead, we should use the money to add a spell-checker to Mozilla, so I woulden't look like an idot that can't spell 'subsudising' properly.

Coming soon (2, Funny)

Anonymous Coward | more than 11 years ago | (#6774265)

If your website contains animated gifs, you are required to get a license to broadcast television.

Re:Coming soon (1)

SmackCrackandPot (641205) | more than 11 years ago | (#6774382)

If you buy a WinTV card for your PC in the UK, you have to buy a TV license every year. Not funny!

Re:Coming soon (1)

Fred Ferrigno (122319) | more than 11 years ago | (#6774604)

The licenses support the BBC, no? And you can watch the BBC with your TV card, no? So you should pay for watching the BBC, yes?

Otherwise you get PBS, which interrupts every 5 minutes to remind you that if you don't donate and receive this nifty travel mug, you're a scum-sucking thief.

Re:Coming soon (0)

Anonymous Coward | more than 11 years ago | (#6774828)

What if you don't watch the BBC and only use it for.. receiving amateur television (similar to amateur radio)? Not that you can nessicarily receive any ATV on regular TV bands, but you could have a downconvertor that allowed you to.

Re:Coming soon (0)

Anonymous Coward | more than 11 years ago | (#6774916)

Write your MP with your sob story of oppression? IF you write often enough, he'll probably get pissed and pay your stupid license for you.

Re:Coming soon (2, Funny)

frank_adrian314159 (469671) | more than 11 years ago | (#6774389)

If your website contains animated gifs, ...

... you should do everyone a favor and shoot yourself before you spread your |\/|/-\|) 4RT sKillZ any further.

Bass Ackwards? (4, Insightful)

lambadomy (160559) | more than 11 years ago | (#6774277)

Governments (pretty much all of them) seem to be completely out of the loop and out of control when it comes to technology. Good decisions sometimes get made, but too often it seems they're just throwing darts at a dartboard, completely missing it and assuming that means Ban it or Tax it or Regulate it. And even if you like the idea of regulation for whatever it is, they always try to apply old rules to new things.

In this case, they're trying to treat VoIP as...a regular telephone. Charging them for the 911 setup? What? You want them to be a telecom and pay nebulous telecom fees, ok...why do these fees even exist? By the day I am feeling more and more lost in my own country. Or maybe it's just the world, no one seems to do it significantly better. on any kind of a regular basis.

This nation likes to call itself capitalist, but to me it just looks like a huge pile or regulation, largely designed to create monopolys but not really regulate them - combined with a ton of subsidies, kickbacks, whatever to already large buisiness interests that are also exceedingly anti-capitalist.

Ok to uh, keep on topic, this is ridiculous. VoIP is not the telephone. And why is this Minnesotas decision to make, shouldn't this be at a federal level? Seems like telephony has a pretty large interstate component.

VoIP is the telephone. (4, Insightful)

mindstrm (20013) | more than 11 years ago | (#6774378)

VoIP doens't mean "Any voice service on the internet". VoIP is a specific set of protocols for providing integration with the telephone system via IP.

What Vonage offers is a box that you plug a telephone into, get a real telephone number, and make real telephone calls to and from. It is no more or less a telephone than the telephone you use in your house hooked up to your phone company.. the only difference is the backhaul.

So.. rather than saying "Should vonage be regulated"... the question should be "What is different about Vonage that they should not be bound by the regulation the phone company is? Could the phone company start giving you a cisco VOIP box, a DSL line, and thereby avoid regulation? You bet they can't, cause they are the phone company.. why should Vonage be able to offer something the phone company cannot legally offer?

It's minnesota's decision to make because Vonage is offering phone service to Minnesotans.

Re:VoIP is the telephone. (1)

BaldingByMicrosoft (585534) | more than 11 years ago | (#6774901)

So.. rather than saying "Should vonage be regulated"... the question should be "What is different about Vonage that they should not be bound by the regulation the phone company is?


Most obvious in my mind: They don't have a monopoly on the "last mile".

Re:Bass Ackwards? (1)

bussdriver (620565) | more than 11 years ago | (#6774448)

Not really.

Many problems have come about by treating 'new' things with new rules. read your slashdot.

As a GENERAL rule its better to extend existing law to 'new' things. IP phones are not really that 'new', its just a phone with a different network layers.

Sure, a FEW laws may not apply, but most do. Such as 911 laws.

If a law does not fit, then simply exempt it; but one should always hesitate before creating 'new' laws. We have way too many 'special case' laws now.

Lawyers are just giving themselves job security by running for legislative office.

Double Dipping taxes (5, Interesting)

Big Ryan (11871) | more than 11 years ago | (#6774290)

If you connect to the net via the phone company (DSL or modem), you are already paying these taxes. Vonage and other VOIP companies are simply providing a service over existing telecommunications infrastructure. If they tax VOIP, you will end up paying the tax twice.

Re:Double Dipping taxes (1)

zakezuke (229119) | more than 11 years ago | (#6774408)

You already pay the tax twice if you use any 1010 xxx codes. This is what's damned annoying.

There was a time that these taxes applied once to the phone line. I noticed one day the bill went up a fuck of alot. AT&T was charging to put their bill on my phone bill, as well as the same taxes were being billed on both the local telco segment of the bill, as well as the AT&T long distance. On top of that, the same taxes apeared for each 1010xxx number, a series of 3 I used at the time. Needless to say there hell of alot of taxes per actual money paid for long distance.

Needless to say, I cancled the long distance, and started using calling cards. It was the only way I could avoid the major double dipping taxes going on.

They are being nothing if not consistant.

Re:Double Dipping taxes (1)

Safety Cap (253500) | more than 11 years ago | (#6774702)

You already pay the tax twice ~.
That is the crux of the matter. States are going after this because they see easy money. With the decline of land-lines, they are possibly losing some tax revinue (consider that when you travel, do you pay taxes where you are physically located?).

I have a basic land line, no frills, no caller ID, no nothing, for which I pay $11 base rate and $16 in taxes and fees. I imagine that it is only a matter of time before cell phone taxes and fees achieve the same proportion to base cost. Like you, I use a calling card for all long distance calls to avoid the tax and fee hit from the long-distance carrier.

MOD PARENT UP!! (0)

Anonymous Coward | more than 11 years ago | (#6774698)

This is double taxing and nothing else.

Seems pretty straight forward to me... (4, Insightful)

mpthompson (457482) | more than 11 years ago | (#6774311)

From the Vonage web site "Vonage is proud to offer 911 dialing. When you dial 911, your call is routed from the Vonage Digital Voice network to your local emergency service dispatcher." [vonage-promotion.com]

In instances where a company is offering Internet based services that both compete and replace traditional services, it makes sense that such a service would be subject to the same regulatory control as the competition. In this specific case, if you replace your residential phone service with Vonage VoIP service, it seems both reasonable and a matter of public safety that a call made to 911 from your residential phone connect you to local emergency services. As a valuable community service, 911 is funded by fees charged to local phone companies. It seems unreasonable for Vonage to escape paying 911 and related fees that it's regulated competitors can't avoid paying.

Minnesota's Public Utilities Commission does not seem to be overreaching in this case.

Where things get tricky are services that don't outright replace residential or business phone services, but offer a quasi-phone service such as the voice services now being offered as part of some instant message services. At what point do these unregulated services cross the line where they become subject to local public utility commission regulations.

Re:Seems pretty straight forward to me... (1, Informative)

Anonymous Coward | more than 11 years ago | (#6774564)

Their 911 dialing isn't the same as from a normal phone line, as stated here [vonage.com]

"Your Call Will Go To A General Access Line at the Public Safety Answering Point (PSAP). This is different from the 911 Emergency Response Center where traditional 911 calls go.

This means your call goes to a different phone number than traditional 911 calls. Also, you will need to state the nature of your emergency promptly and clearly, including your location and telephone number, as PSAP personnel will NOT have this information at hand."

Re:Seems pretty straight forward to me... (1)

MoralHazard (447833) | more than 11 years ago | (#6774689)

the worst HAS to be the idea that if it looks like a duck, quacks like a duck, and walks like a duck, you have to regulate and tax it like a duck. VoIP is totally different from ordinary phone service in almost every way that is relevant to taxation and regulation.

Consider WHY we invented public utility commissions for phone, electric, gas, etc, but not for (say) supermarkets: because there are NATURAL MONOPOLIES in the utility business, making it unrealistic to allow multiple providers in a single area (what there were 20 local phone companies digging up the streets to fix cable?), and you have to keep those monopolies in check artificially. Supermarkets don't have regulation to the level of the phone company because competition will generally do a good idea of keeping them in line. (Sure, they have rules to follow, but it's sooo much less.)

If you've ever had to deal with provisioning new copper for a business, you know of what I speak. All of the phone company-borne issues are a nightmare: expensive, shitty service, and it takes forever to get anything done. Contrast that to the services provided by the ISP who resells the lines to you: their routers are on backup power (go Focal!), and they fix broken stuff in minutes or hours, not days or weeks. The ISP knows that if they fuck up, you can drop your contract and call their competition. Verizon, to quote Lily Tomlin, gets to say: "We're the phone company. We don't *h
ave* to care!"

Maybe you ought to impose some rules on Vonage, to ensure proper 911-related operation--after all, we have health inspectors for supermarkets. But don't regulate them just because they're like other phone providers! If that sounds unfair to the telcos, and liable to drive the telco out of the local phone business, that's GREAT! Then we can have an actual competitive market to provide local phone service via the Internet, and we won't need the PUCs the ever talk about phone service again--they will be running the copper, and that's it.

And if I'm wrong, what's the harm in leaving them alone? If they provide bad service or charge outrageous amounts, people will just go back the telco (or not leave it). Just make sure they follow the basic rules for safety, and leave my fucking VoIP alone!

Re:Seems pretty straight forward to me... (1)

Lord Kano (13027) | more than 11 years ago | (#6774736)

In instances where a company is offering Internet based services that both compete and replace traditional services, it makes sense that such a service would be subject to the same regulatory control as the competition.

In a word, Bullshit. Email coupled with a scanner and a printer can replace the USPS for many run of the mill mailings. That doesn't mean that the USPS should have the ability to regulate. (Yes HR 602P is a hoax, but you are echoing the thinking that could one day make it reality)

At what point do these unregulated services cross the line where they become subject to local public utility commission regulations.

They never do. If they don't have a branch office or something located in the state in question, that state has NO RIGHT to regulate them. Period. A state's rights end at its borders. For example, if I were to say that George Bush and Bill Clinton can suck my (whatever), neither Arkansas nor Texas could bring me up on obscenity charges because I'm safely in another state. The fact that people from Arkansas and Texas may see this post doesn't make a difference.

LK

A clear division... (4, Insightful)

Ungrounded Lightning (62228) | more than 11 years ago | (#6774873)

Where things get tricky are services that don't outright replace residential or business phone services, but offer a quasi-phone service such as the voice services now being offered as part of some instant message services. At what point do these unregulated services cross the line where they become subject to local public utility commission regulations?

How about the point where they interconnect and exchange calls with the POTS network?

Talk only to other net phones, you're a net application. Interconnect net calls with POTS calls as a service to your customers and you're a phone company.

And when I say "as a service to your customers" I'm making a distinction:

If you're selling connectivity to the POTS network to general customers, suitable for replacing local phone service, you're a telco - whether you're doing it over copper, fiber, "cellphone" packet, 802.*, infrared, wires-through-wormholes, or what-have-you.

If you're selling a PBX replacement, hooking up a customer to his own lines for which he's ALREADY paying off a telco and the telco's tax man, you're an equipment/software vendor.

I wonder... (0, Troll)

HBI (604924) | more than 11 years ago | (#6774313)

I wonder if the problem is cured if Vonage just stops offering service in Minnesota.

In a different field, auto insurance, most providers hate doing business in NJ because the state sucks - every 3 years the government gets a bug up its ass and changes the rules around because we have the highest (or near the highest) auto insurance rates in the country. So companies like State Farm, GEICO, Firemans Fund, etc have pulled out of New Jersey and do not offer policies here.

Sounds like a similar case brewing unless the MN PUC gets its act together.

Sweet! (1)

neiffer (698776) | more than 11 years ago | (#6774314)

Now, Vonnage and Packet8 will start to suck as much as the phone companies current regulated by the states. Qwest is sucktastic, and you complain to the state and they basically tell you there is nothing they can do...but, hey, they are regulating!

Taxing packets (3, Insightful)

wytcld (179112) | more than 11 years ago | (#6774326)

Ending up with a situation where some packets sent over IP are taxed - specifically in this case a subset of packets containing vocal audio - can only lead to a situation where every single packet needs to be audited simply in order to track and log the taxable ones. That's horrendous enough - and so expensive to implement that even aside from the privacy implications it would cost much more than any revenues raised.

But consider, what's the difference between a packet of "telephone" voice and a packet of "Internet radio" voice? What's the difference between an Internet radio monolog and a conference call in which one party is doing all the talking? If two people listen live to each others' Internet radio shows, and converse thereby, is it telephony for purposes of taxation? If so, then when is Net radio not a phone call?

The only sane conclusion is: Vocal conversation over the Net may look like a phone call, but it's really something else. It may also look like radio, but it's really something else. Making Internet "phone" companies license themselves as real phone companies do makes no more sense than requiring a broadcast license of Net radio stations.

Re:Taxing packets (1)

mindstrm (20013) | more than 11 years ago | (#6774425)

This is not about packets. It's about a service that integrates with the standard, regulated telco network.

This is not about voice over the internet, it's about a telephone service.. the fact that it uses the internet as a transport is incidental.
If they offfered the same service via some kind of newfangled radio or satellite service, they would be subject to the same argument.

Re:Taxing packets (1)

mindstrm (20013) | more than 11 years ago | (#6774442)

If I use a regular phone, dial a regular phone number, and talk to someone who is also using a real phone.. is it still not a phone call?

How do you figure vonage's local phone service is different than a normal phone service? this isn't about ip to ip voice chat.. it's about real phone service.

Internet radio is not radio.. it's a differnet thing, agreed...
but Vonage's VOIP service is real, honest-to-god phone service. You get a real phone number, use a real telephone, and can make and receive real phone calls to and from anyhwere in the world. In any way you want to look at it, vonage is a REAL PHONE COMPANY.

911 (2, Insightful)

hedley (8715) | more than 11 years ago | (#6774339)

Vonage mentions they are The Broadband Phone Company on their web page. If you are a phone company then you have to pay into the 911 kitty for that state. If the local phone companies pay for it, you better believe they will hit up those that don't. Vonage offers a 911 that calls the local police dept. Of course you don't get the address and it bypasses the states paid for official 911 service.

Competitors like Packet8 don't offer 911 service and stay away from calling themselves a phone company.

Clearly tho the agenda of the PUC's in PA and MN is to squash VoIP since it is a real threat. Kill it now before it gets to be a monster they cannot regulate and kill.

Hedley

Re:911 (1)

SpaceLifeForm (228190) | more than 11 years ago | (#6774396)

It's not the PUC's agenda really, but the incumbent telcos that will lose revenue. All gubmint agencies these days are in bed with 'big bizness', and 'big bizness' can't stand a bit of competition. Nothing new here.

Re:911 (2, Interesting)

jaredmauch (633928) | more than 11 years ago | (#6774579)

Speaking as a vonage user who does not have 911 activiated (I use vonage as a second telephone line), I think that users that activate their 911 service should have to pay to the state/local authorities the necessary monies. The issue I see here as it relates to Vonage and 911 is quite complex. I can take my ata-186 and plug it in here at home, or with me anyplace else I go. This obviously poses a challenge for providing emergency services, but I remember the days (albeit not that long ago) where 911 did not exist. You had to call the local police/fire/poison control centers. While having a standard is a good thing in most cases, people who make a conscious choice here shouldn't be punished (IMHO).

Vonage also makes the issue very complex. For $ (N*5) I can get a telephone number that is local to N cities where they offer service. Should those telephone numbers be subject to such 911 fees in each locality, or should you only pay once per telephone number? What if you add a vonage fax line, it's never used for voice, are you required to pay for 911 fees on that as well?

I don't see that the PUCs are out to squash VoIP as a threat, just something that will require some rules to be made regarding 911 service availability, and perhaps some far more interesting things to happen, including giving locations of specific IP addresses to emergency responders. If I know that MIT has 18.0.0.0/8, and each subnet is a /16 (for example) and they have the addresses of these buildings available, why not have a registry (oh wait, there is, whois/rwhois.. but) of these available, so vonage can say "here's where that ip is". Obviously a very thorny privacy issue as well, because if everyones favorite 4 leter ?IAA org had access as well, you'd keep your file trading down quite a bit i'm sure :).

Back on topic:
No easy solution here, the PUC's don't care how the telephone service works behind the scenes, be it via POTS, VoIP, just that it works and that the required things are done (eg: 911 service in Minnesota). Vonage can always lobby there that they should be exempt and that whomever they're using (Probally focal, as you can see here: npa nxx lookup [nether.net] ) to get their blocks of DIDs from should or is already paying such fees. Hopefully they're paying them to focal, the issue is should it be one fee per DS1 (DID) service, or one fee per number assigned to that T1 trunk.

They can't have it both ways (1)

laing (303349) | more than 11 years ago | (#6774373)

Traditional telephone service has strict privacy regulations and lots of other (strange) rules such as the prohibition of the use of encryption devices. Nobody can legally listen to a plain old telephone service (POTS) call without a court order.

Voice Over IP (VoIP) uses the Internet as the common carrier. There are no such privacy rules on the internet. Anyone can legally monitor anyone's Internet traffic (including VoIP phone calls).

If MN wants to claim that VoIP service should be similarly regulated, then VoIP should be granted the same protection under the law that POTS has.

Re:They can't have it both ways (2, Informative)

gclef (96311) | more than 11 years ago | (#6774529)

That is not entirely right. at least, not in the US (not sure what the rules are elsewhere). Packetsniffing traffic you are not entitled to legally monitor is a violation of federal wiretap laws (and therefore a federal felony).

Now, it is true that companies can monitor traffic that passes over a network they own (your ISP can sniff your traffic if you're using them), specifically if they are doing it for standard business reasons (like tracking abuse, troubleshooting network problems, IDS', etc)...but that script kiddy listening to your traffic is committing a federal felony, and your ISP can not just randomly sniff your traffic for giggles.

Sure, there aren't enough Feds on the planet to investigate and prosecute the violations of this setup, but that doesn't make it legal. If Vonage is sniffing your calls for any non-business-defined reason (and they'd better have documentation as to what those reasons are), they're committing a federal offense.

Encryption (1)

Detritus (11846) | more than 11 years ago | (#6774619)

There is no law against the use of encryption devices for telephone calls. That said, the federal government has "encouraged" vendors of voice encryption hardware to restrict sales to the unwashed masses.

Vonage doesn't allow dirty jokes (2)

rogersc (622395) | more than 11 years ago | (#6774379)

Vonage customers have to agree not to say or listen to anything offensive! No dirty jokes, racist comments, etc. The contract says [politechbot.com] :
You agree to use the Service and Device only for lawful purposes. This means that you agree not to use them for transmitting or receiving any illegal, harmful, threatening, abusive, harassing, defamatory, obscene, sexually explicit, profane, racially or ethnically disparaging remarks or otherwise objectionable material of any kind, including but not limited to any material that encourages conduct that would constitute a criminal offense, give rise to a civil liability, or otherwise violate any applicable local, state, national or international law.

Re:Vonage doesn't allow dirty jokes (2, Interesting)

Ungrounded Lightning (62228) | more than 11 years ago | (#6774927)

Vonage customers have to agree not to say or listen to anything offensive!

Actually, they're just setting up a contractual obligation not to use their service for obscene phone calls or planning crimes. That's so they are covered against suits if their customers misbehave.

Why did they do this? Because they believe they AREN'T a phone company (common carrier), and that they thus wouldn't be protected by the laws that keep a phone company from being sued for what its customers send over its wires.

Regulate the People (0)

Anonymous Coward | more than 11 years ago | (#6774385)

With all the tragic consequences of deregulation all around us, how can anyone here at slashdot think keeping this deregulated is a good idea?

There is money involved here and we all know what that does. The government has a right control people involved in economic issues. The nation comes first, the interest of greedy people, second.

Re:Regulate the People (1)

tlianza (454820) | more than 11 years ago | (#6774511)

The nation comes first, the interest of greedy people, second.

Wow. If we would have had that attitude to begin with, Vonage never would have came out with the service at all. If it wasn't for "greed" they wouldn't have attempted this inovation and provided people with the choices they have today. This is a dangerous attitude to have.

Re:Regulate the People (1)

Bull999999 (652264) | more than 11 years ago | (#6774640)

Then tell me, why did est. 10,000 die in Frence in the heat wave dispite all their wonderful regulations?

Re:Regulate the People (1)

mousse-man (632412) | more than 11 years ago | (#6775053)

Even stranger is that about half of these 10k people died in institutions where they ought to have their health watched by paid nurses and health workers...

It's about time... (1)

linuxtelephony (141049) | more than 11 years ago | (#6774397)

It's about time things like this started to happen.

First, I don't think outbound only service, often called PC to phone, should arbitrarily be considered phone service and regulated.

Second, I don't think PC to PC service should be touched at all.

However, from what I've seen of VonAge, they ARE a telephone company and should be treated exactly the same as a telephone company.

Consider, VonAge offers: 911 dialing, Keep your phone number (local number portability), in-coming and out-going calls, 3 way calling, call waiting, call forwarding, caller ID, etc. etc. etc.

What makes VonAge different from any other phone company service a local service area? They happen to use the Internet as the "last-mile" connection instead of leased or owned copper.

Unlike PC to phone service, VonAge acts exactly like phone service from any *LEC or RBOC.

I commend MN's decision to treat these people the same as they would any other phone company in the state.

I have not read MN's ruling, however, and if they also target PC to PC (or LAN to LAN), or PC to Phone, based services then I think they need to scale things back.

Just because something uses the Internet for some of its transport does not mean that it should be excluded from following the same rules and laws any other provider would have to follow for the exact same service.

Re:It's about time... (0)

Anonymous Coward | more than 11 years ago | (#6775017)

Vontage *IS* PC to Phone.

However, instead of using a PC, you use a hardware device that plugs into your internet connection.

Want to tax my phone line - stop taxing my DSL! (1)

melted (227442) | more than 11 years ago | (#6774412)

It's as simple as that. Why the heck should I pay taxes TWICE on the same thing?

ME GOD (0)

ddew (684795) | more than 11 years ago | (#6774424)

I'm I the only one to become scared when stuff like this arises? Almost as frightening as ms ban on non-msn clients

So what about those cell phones? (1)

mod_critical (699118) | more than 11 years ago | (#6774436)

I've had my land line replaced with a cellular phone now for quite some time. My bill is really straight foreward, the same number follows me wherever I go, I don't pay any long distance charges, and 911 maps to my local dispatch.

I don't know exactly how the government treats cellular providers but it seems to me that everything about the Vonage VoIP phones that is exciting all my colleagues applies to my cellular service. And because I live in Minnesota I'm really liking the stability of my cellular service's governmental regulation

what this really means (1)

penguin7of9 (697383) | more than 11 years ago | (#6774443)

Companies like Vonage really are only here for a transitional period: they give you a way to connect VoIP service to the regular phone network. That's not a long-term business model.

But for Internet-to-Internet calls, any attempt at regulation would be futile. In fact, there doesn't even have to be any kind of business involved in the middle.

States can, of course, tax IP traffic or Internet access, but regulations that try to distinguish between different uses of that traffic would be very hard and costly to enforce and trivial to work around.

Double dipping and Lobbyist rants (2, Insightful)

segment (695309) | more than 11 years ago | (#6774445)


It may have been said here or not, sometimes I don't feel like sorting through the FP's and other trollings.

Wouldn't this be a case of double dipping by the telco's being that they're charging you for bandwidth usage, along with an added cost to using VoIP?

Another thing I would like to point out, is telco's have deep ass pockets, as most of us know. Don't be fooled by their rants on not having enough money for yadda yadda, or being monopolized because it's political propaganda. Telco's who need laws passed often spend enormous amounts of money lobbying politicians to get them to pass these measures. It's definitely about time people got together and lobbied against this type of bs. Is everyone going to wait until the last second until everything is being regulated under some 3rd world like rules that make no sense.

Anyone using these services? (0)

Anonymous Coward | more than 11 years ago | (#6774599)

The last time I tried them, they suffered from copious amounts of latency and delays. I had to repeat myself more often than not. Waste of fscking money at the time. Have they improved?

Re:Anyone using these services? (0)

Anonymous Coward | more than 11 years ago | (#6775064)

Yes. Vonage replaced my landline. Sound quality is equal to my old SBC/Ameritech line, plus I can take my ATA-186 with me on vacation or on contract jobs and my home phone rings at my desk / in my hotel room. How cool is that? I can make a local call to relatives from 3000 miles away. Slick.

So... (1, Funny)

Anonymous Coward | more than 11 years ago | (#6774613)

Now Vonnage must be overpriced, unreliable, riddled with billing errors, and have 30 minute hold times like the regular phone companies?
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