Washington Utilities & Transportation Commission (UTC) in June ordered that VOIP firm LocalDial is a telecom firm and so has to follow the same laws as other long-distance companies.
     The high-profile case was seen as a testing ground for arguments on both sides of the VOIP regulation debate -- whether to control it with age-old telecom rules or call it an information service -- such as the internet that allowed its creation.
     Most major telecom carriers are using proprietary IP networks for VOIP to save money and take advantage of features the new technology offers and thus are not clarifying how to regulate VOIP.
     UTC was petitioned by incumbent local exchange carriers who wanted LocalDial to pay them the same tariffs that traditional long-distance firms pay -- because the firm's calls originate and are completed on standard telephone equipment using the local telecom infrastructure.
     In the end that argument was the basis for the UTC's decision.
     That's a disappointment, David Svanda of the Voice on the Net Coalition told RT.
     His group represents the VOIP firms fighting to be allowed to evolve in an environment un-smothered by regulations.
     FCC Chairman Michael Powell has publicly declared support for letting VOIP grow but the UTC decision echoes an FCC decision on April 21 against AT&T's wishes to exempt its IP-based phone service from the access charges that apply to traditional calls.
     Most residential VOIP firms supply a box that users plug their home phone into -- and the box plugs into the home network and makes the calls over a broadband connection.
     Enterprise versions usually use a proprietary network but calls still don't originate on the local phone line -- as do LocalDial calls.

(Published in Restructuring Today on June 16, 2004)