FCC members note dated rules for new technology

Kevin Rademacher

Thursday, Oct. 14, 2004 | 11:12 a.m.

Federal regulators are well aware that changing technology in the telecommunications industry demands careful examination.

Three members of the Federal Communications Commission, sitting on a panel at the Telecom '04 conference in Las Vegas on Wednesday, made that point clear. The problem, they said, is that they are still working under rules established years before much of the current technology existed.

Meanwhile, uncertainty over how new regulations will be applied to products such as Voice-over Internet Protocol, which delivers telephone service over high-speed Internet instead of traditional copper wires, threatens to stall investment.

"What we are trying to do is ensure that we create a regulatory environment that creates investment certainty ... and yet deal with statutes that were designed in a time and place when we had a single monopoly provider," said FCC Commissioner Kathleen Abernathy.

The commissioners agreed that while decisions are unclear on how new technology will be regulated, some providers could balk at making investments. That would threaten to leave some communities without the benefit of new products and services.

Commissioner Jonathan Adelstein said one telecommunications executive at the Las Vegas convention said his company was considering making no system investments in 2005 because the uncertain regulatory landscape could change revenue flow.

Internet-based VoIP is currently unregulated since the commission has taken a hands-off approach to that technology thus far, but new rules could be handed down on details such as 911 service, federal wiretapping rules and contributions to the universal service fund which supports service in rural areas.

"We need to act now so people know," Adelstein said.

Commissioner Kevin Martin also said he was concerned about leveling the playing field. Telecommunications companies are currently strapped with regulations that cloud their efforts to add video service to their broadband lines. Meanwhile, cable companies, which are not federally regulated, have been able to offer telephone service over cable modems using VoIP technology.

Cox Communications, the dominant cable company in Las Vegas, has indicated that it will offer such service in the future. The Atlanta-based company currently has VoIP service in markets that include Phoenix and San Diego.

"It's been very frustrating to see the unlevel playing field that exists," Martin said.

The commissioners indicated that the current rules -- established in 1996 -- are likely to be examined by Congress next year. Industry officials, however, cautioned that the 1996 rules took years to hammer out.