State VoIP Regulation Scorecard: 25 Down – 25 To Go

Legislation barring local utility commissions from regulating Voice over Internet Protocol (VoIP) service has breezed through the California legislature, making it the 25th state to pass such regulations. As this blog is being written the new law – passed by overwhelming majorities of 63-12 in the California Assembly and  28-7 in the Senate – was sitting on Gov. Jerry Brown’s desk awaiting his signature, which was expected without problem.

What the law will do is ban “any department, agency, commission, or political subdivision of the state from enacting, adopting, or enforcing any law, rule, regulation, ordinance, standard, order, or other provision having the force or effect of law” regulating VoIP. Indeed it covers almost all IP-enabled services, and the ban stays in effect until 2020.  A key point in the law is that California does recognize the right of the federal government, in the form of the Federal Communications Commission (FCC), to regulate VoIP.

What’s happening here is that one state after another is backing off any claim to having a right to regulate VoIP. In my opinion, this is a good thing for both VoIP users and providers, because it means that VoIP providers, such as Phone.com, aren’t going to have to deal with a nightmare scenario of 50 different sets of VoIP rules – and potentially more if counties and cities get into the act. It almost makes me pity the traditional landline switched circuit phone providers, who do face a labyrinth of government regulations on both the local and federal levels.

To be even-handed, I should note that some consumer groups are opposing these state laws, facing off against high tech companies and organizations – particularly in California – who are backing it. There’s also more than a bit of resentment by some Public Utility Commission members in California and other states, who feel that their authority is being undermined.

But I’m thinking of just how bad things could have gotten were each state to set its own VoIP rules. It is easy to imagine, particularly for business VoIP. For instance, if you’re using a Virtual PBX, the truth is that there really is a piece of hardware somewhere out there in the cloud providing that service. But which state gets to regulate that server and service? Perhaps it’s your home state. Or perhaps it’s the state where the hardware sits. Oh, and the other state where the geographically remote emergency backup hardware is located. And perhaps you’d also have to answer to a state where your business has a phone number with a local area code but no physical presence (a service Phone.com offers, with numbers from every state in the nation, plus worldwide numbers, available). But by now readers should get the picture – a unified nationwide set of rules is going to be good for all of us, and I’m not going to argue about what those rules should or shouldn’t be in this blog, although I do have my opinions.

For now: 25 states down, 25 to go.