[Congressional Record Volume 150, Number 45 (Friday, April 2, 2004)]
[Extensions of Remarks]
[Pages E526-E527]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                THE VOIP REGULATORY FREEDOM ACT OF 2004

                                 ______
                                 

                   HON. CHARLES W. ``CHIP'' PICKERING

                             of mississippi

                    in the house of representatives

                         Friday, April 2, 2004

  Mr. PICKERING. Mr. Speaker, I rise today to introduce the ``VoIP 
Regulatory Freedom Act of 2004,'' in conjunction with my colleague in 
the United States Senate, Mr. Sununu, who will be introducing the 
companion version of this bill in that Chamber today.
  This act will grant regulatory freedom to a new and exciting 
technology known as voiceover-Internet-protocol, or VoIP, by 
prohibiting the imposition of unnecessary federal, state and local 
regulation in order to allow this emerging technology to grow and 
develop. VoIP has flourished and prospered thus far because of the 
relatively hands-off approach taken by regulators and concomitantly the 
effectiveness and robust nature of the competitive marketplace. In 
order to ensure the continued success of this new technology, and the 
concurrent benefits which it delivers to the American consumer, we must 
prevent the wholesale or even piecemeal application of outdated 
regulations.
   VoIP is the technology that allows voice communications to be 
converted into ``packets'' and transported with data over an IP 
network, such as the public internet or a privately managed IP network, 
to the desired location using IP addressing. The end result is a more 
innovative and technologically-advanced service to the consumer, while 
also the most efficient and cost-effective method by which to 
communicate.
  Because VoIP is predominantly interstate in nature, the bill provides 
for a prohibition of state and local regulation and taxation of the 
application. This in no way implies that states and localities do not 
play a very important role in our federalist system as it relates to 
telecommunications policy. Rather, because of the unique attributes of 
this technology, including its mobility in some instances, a general 
inability to decipher the actual origination of calls in other 
instances, and the irrelevant treatment of area codes when assigning 
numbers, it would be deleterious to impose a patchwork of 50 different 
sets of regulatory regimes on such a nascent and far-reaching 
technology.
  Having said all that, I do recognize that there are specific types of 
VoIP applications that have the capability to send calls to or receive 
calls from the public switched telephone network (``PSTN''), which I 
refer to as ``connected VolP applications.'' By sending and receiving 
calls to the PSTN, providers of connected VoIP applications will have 
to assume some obligations, such as (1) some type of interprovider 
compensation; (2) contribution to the Universal Service Fund; (3) 
compliance with law enforcement access; and (4) industry consensus on 
social obligations such as 911 service, disability access, reliability 
and security.
  First, in light of the capability to send calls to or receive calls 
from the PSTN, the bill recognizes an obligation on the part of 
providers of connected VoIP applications to compensate others for the 
use of their facilities and equipment on the PSTN through some sore of 
interprovider compensation, which will be determined by the Federal 
Communications Commission. When making this determination, the

[[Page E527]]

FCC must take into account the differing geographic markets, especially 
the rural areas, which make up our country. The FCC will also be 
required to include a transition period, to allow the providers to 
adequately adjust to a new regime of compensation.

  Second, by sending and receiving calls to the PSTN, providers of 
connected VoIP applications will be required to contribute to the 
overarching national goal of universal access to and affordable 
telephony for all Americans. When deciding upon the best methodology by 
which to assess such providers, the FCC will consider a variety of 
contribution methodologies. However, the main goal in applying USF to 
connected VoIP application providers is ensuring that the Fund is 
sustainable over the long term, and the FCC must seek to maximize to 
the greatest extent possible contributions into the Fund.
  Under both scenarios, the bill will require the FCC to complete a 
rulemaking within 6 months to decide how such providers will meet their 
obligations. While this bill only addresses a small sliver of the 
overarching deficiencies associated with the universal service fund and 
the interprovider compensation regime, I intend to propose new 
legislation in the next few weeks that will tackle both issues head on 
and require a definitive conclusion to these perplexing problems.
  Third, because of all the potential capabilities of this technology, 
we would be hard-pressed not to allow access by law enforcement. 
Especially in the day and age in which we live, including this time of 
war, we must always be thinking of our overall national security. 
Therefore, the bill would require the FCC to examine the 
technologically feasibility of requiring law enforcement access to such 
technology. If and when the FCC determines that it is technologically 
feasible and reasonable to do so, providers of connected VoIP 
applications will then be required to comply with law enforcement. 
While this may be somewhat burdensome on the industry, the value of our 
security far outweighs any burden which may be imposed. Security of our 
citizens will always be our number one priority.
  In sum, the ``VoIP Regulatory Freedom Act of 2004'' bill will provide 
certainty in an area of the telecommunications industry that is 
significantly changing the way people communicate with one another. By 
establishing a new regime for this constantly-evolving technology, 
separate and apart from the outdated and archaic statutes and 
regulations applicable to traditional circuit-switched telephony, I 
believe we are laying the necessary groundwork for a new era of 
telecommunications.
  Mr. Speaker, I look forward to working with you and other members of 
the House, as well as our colleagues in the Senate, to achieve a 
bipartisan consensus on this most important initiative.

                          ____________________