FCC urged to keep VoIP regulation-free

Advocacy groups ask FCC Chairman Michael Powell to protect Net phone companies from weighty regulations that blanket traditional phone services.

By Declan McCullagh
Staff Writer, CNET News.com

Published: April 7, 2004, 12:13 PM PDT

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Dozens of conservative and lower-tax advocacy groups on Wednesday urged the Federal Communications Commission to protect Internet telephone services from crushing regulations.

In a letter to FCC Chairman Michael Powell, the organizations asked him to make sure that the weighty quilt of regulations blanketing traditional phone services will not apply to fledgling voice over Internet Protocol (VoIP) companies.



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"We urge the commission to send a clear signal of forbearance on new taxation and regulation," said the letter's 34 signers, which included many groups that are influential within the Republican Party. Among the signers are the National Taxpayers Union, Americans for Tax Reform, the Council for Citizens Against Government Waste, Republicans United for Tax Relief, and the Family Research Council.

The FCC is considering what rules, if any, will govern VoIP services that partially travel over the traditional phone network. The FCC has already ruled that Internet-to-Internet phone calls and instant-messaging communications that do not touch the phone network are immune from the hefty stack of government rules, taxes and requirements that applied to 20th-century telephone networks.

Glaringly absent from the letter was any mention of the controversial topic of wiretapping VoIP conversations. Last month, the FBI published a sweeping proposal that would require all broadband Internet providers, including cable modem and DSL (digital subscriber line) companies, to rewire their networks to support easy wiretapping by police.

The language could even force companies to build backdoors into everything from instant-messaging and VoIP programs to Microsoft's Xbox Live game service. The deadline to submit comments to the FCC responding to the Bush administration's request is Monday.

"We chose not to get into that area," said John Berthoud, president of the National Taxpayers Union, which organized the ad hoc coalition. "We wanted to maximize the number of groups and focus on a limited number of issues. There's a trade-off. You broaden the topic, you lose people."

Some of the coalition members are close to the law-and-order wing of the Republican Party and might not agree to sign a letter that could be seen as opposing the FBI. Other members, like Americans for Tax Reform, have been strong defenders of encryption and electronic privacy in the past.

Wednesday's letter also calls for a renewal of a temporary federal ban on Internet access taxes, which expired in November. "In the period since the moratorium has expired, many state and local elected leaders have begun eyeing new charges on Internet access and commerce," the letter said.