VoIP Users Face A New FCC

by Stuart Zipper

There’s change coming in the VoIP world, change that will potentially affect every VoIP provider and every VoIP user. Driving that prediction is a forthcoming change in the leadership of the Federal Communications Commission (FCC), following the announcement last week by FCC Chairman Julius Genachowski that he is retiring after four years on the job. FCC Commissioner   Robert McDowell has also announced his planned departure from the board. That leaves two of the five seats on the board, including the chairman’s seat, up for grabs.

It’s not clear just what the change will be, although many gurus are predicting that the new FCC board, whoever it consists of, will be taking a hard look at revenue-generating regulations for VoIP, to replace the billions in tax revenue being lost with the slow death of traditional land-line telephony. It should be remembered that, in various places, the tax on a single landline can exceed $10. In general, none of that tax is levied on a VoIP line.

The good news for VoIP users is that, while a reformulated FCC may try to increase taxes, and its regulation of VoIP, the overall cost structure of VoIP phone service is such that the bottom line cost is still going to be a lot less than traditional telephony. In my estimate, the very worst case is that bills will be half of what we once paid for phone service.

And there is also a good argument made for FCC regulation of VoIP and, in general, the Internet. It means that the FCC can mandate quality of service (QoS) levels by the broadband providers that deliver the VoIP services from companies such as Phone.com. Today, as I’ve written many times, broadband providers have no legal requirement to maintain QoS levels for small and medium-size businesses or households (large companies, in contrast, may have QoS guarantees written in to their broadband contracts).

In any case, there’s now intense crystal-ball gazing in the halls of power in Washington as to just whom President Barack Obama will nominate for the soon-to-be open FCC seats. One leader for the chairman’s post is Jessica Rosenworcel, who is already an FCC Commissioner. A group 37 Democratic U.S. Senators have just sent a letter asking President Obama to appoint Rosenworcel to the post. Her appointment would avoid the need for what could be a messy confirmation hearing in the U.S. Senate.

But in the other corner is Tom Wheeler, a former representative for the cable TV and wireless industries who raised $246,000 for the 2012 Obama campaign. And then in the third corner there is Mignon Clyburn, who is also an FCC Commissioner and the daughter of Rep. James Clyburn of South Carolina. And in the fourth corner … well, there are actually more candidates than there are corners being touted by various political pressure groups in Washington.

Bottom line is that advise all my fellow small business phone users to keep an eye on the situation, and if you have strong feelings about what’s happening don’t be shy in letting your elected representatives, all the way up to the President, know how you feel.