House to Tackle Internet Calls
<<<... "When we started dipping our toes in the regulatory water, we were met with a lot of hostility or just blank stares," said Vonage spokeswoman Brooke Schulz. "Now we all kind of agree that the industry needs to be fostered." The convergence of viewpoints has helped the companion bills gain traction in Congress, but none of this means that the House hearing will be a lovefest. In fact, many issues are likely to put VOIP startups at loggerheads with the traditional Bell companies that own the last mile of wires into customer homes.
Take the universal service fund, or USF, which is the primary tool used to keep phone lines affordable in rural America. Without subsidies, people living in small towns would likely pay far more than their urban counterparts for local phone service, because it's more expensive to maintain phone lines in sparsely populated regions.
The fund also provides discounts to schools and libraries for "advanced" telecommunications services. But over many years, cheaper long-distance rates and the migration to flat-rate plans has reduced USF revenues, which worries many lawmakers. "Almost all of the senators are in favor of (USF) because they have rural areas," said Andrew Finn, adjunct professor at George Mason University.
"But as bits become bits, it's not clear what happens to this structure. It may be that the nature of universal service will change." One possibility is to collect universal service fees from all telecommunications providers, including cable operators, wireless companies and even Internet service providers -- perhaps through line-item fees on customer bills.
Of course, those industries have opposed such an approach. For their part, VOIP providers argue that they already help pay for the phone network by purchasing capacity from third parties, which in turn pay into the USF. more>>>