Future Regulations
           
On a national level, despite the globalization of the Internet, VoIP can potentially be subject to some form of regulation through two organizations: the World Trade Organization (WTO) and the International Telecommunications Union (ITU).  Although they could form a national forum, these organizations do not plan to address these issues for many years, mainly due to the current standing of the incumbent carriers.  Despite the creation of other groups, there seems to be a lack of means and recommendations for how to globally regulate Internet telephony. 

Today there are two main areas in which there are valid arguments for regulation of VoIP: economic and social issues.  The former involves regulating rates and quality, as well as keeping up with the market practices of incumbents.  As for the latter issues, policy questions such as: universal service, 911 emergency calls, and CALEA matters are prevalent.  As for these issues, some states, such as Pennsylvania, try to create their own regulations including requiring users connected to the PSTN to pay a $1 monthly fee for 911 services. 

In most countries, incumbent VoIP rules seem to be leaning towards holding VoIP to similar standards as those required by PSTN’s today, such as in Canada and Japan.  However, other countries seem to suggest exempting incumbents’ new broadband networks, such as VoIP from economic regulations required by PSTN.  There is still uncertainty as to whether or not incumbent IP networks will be exempt from economic regulations in the future.

Some VoIP service it seems will never be able to be regulated due to the lack of market power and neither government monopoly nor policy justifications will suffice for its regulation.

In general, there are considered to be four main areas that will determine whether or not VoIP will be regulated: (1) network interconnection, (2) network neutrality, (3) control of customer contact through ENUM or other mechanisms, and (4) Internet governance.       

Network Interconnection

Network interconnection focuses on the scope of network interoperability and the general business scheme that the value of a network will increase the number of users.  Therefore, the first issue to consider is that if there were a business incentive for network owners to connect in certain countries, the demand would have to necessitate it.  If the company cannot capture the market on its own, it would be more likely to interconnect to heighten the value of the network for itself and its users.  However, if there is no business reason to interoperate, regulatory obligations would be needed to force providers of basic telecommunication services to become interconnected.  Conversely, information services are not held to the same standards, and services such as VoIP do not have the right to interoperate under United States law.  The more complicated it becomes for competitors to connect, the more VoIP services will become responsible for more costs due to other providers connecting to their networks. 

Network Neutrality

Network neutrality is concerned with the restriction-free sharing of networks for the benefit of society, without blocking services or users who wish to access them.  Similar to network interconnection, network neutrality is determinative on whether there is a business need.  However, many services wish to block VoIP because of its effect on the revenue of voice phones.  In the United States, within Verizon’s user agreement, its Wireless Broadband access service prohibits customers from using VoIP services over its network.  Even newly developed voice services also plan to disallow its users from engaging in VoIP use.

There are a variety of principles designed to address and minimize the impact of the network neutrality issue.  One of the few regulatory agency pronouncements on the issue came in August 2005, when the FCC adopted a policy statement outlining four principles that were designed "to encourage broadband deployment and preserve and promote the open and interconnected nature of the public Internet." The four principles are:

(1) consumers are entitled to access the lawful Internet content of their choice;

(2) consumers are entitled to run applications and services of their choice, subject to the needs of law enforcement;

(3) consumers are entitled to connect their choice of legal devices that do not harm the network; and

(4) consumers are entitled to competition among network providers, application and service providers, and content providers. 

Although the Commission did not officially require these principles as rules, they intend to use them in their policy activities.  Most of these issues focus on the problems of the consumer, not the providers, which can affect whether or not costs can be lower and quality can be improved.

Control of Customer Contact Through ENUM or Other Mechanisms

Customer Control Contact manages the control of the databases that transmit contacts between networks.  ENUM is a system for routing that can find a single identifier consisting of letters and numbers and then use the patterns for VoIP and other related Internet services on a network other than a PSTN.  There has not been a large discussion on whether or not ENUM should be implemented, but some VoIP services use it themselves without any mandatory regulation rules.  Landline services do not like this as it reduces revenue from their businesses.  

Internet Governance

As of now, the Internet is not regulated at the level at which the government desires.  Conflict over the control of the Internet Corporation for Assigned Names and Numbers (ICANN) has the potential to greatly affect VoIP services.  If ICANN is modified so that the government can have more control over the structure of the Internet, this will affect the internet overall, which includes programs such as VoIP.  At this point, it is not certain what the future holds for VoIP.

Recent Development

Most recently, on March 21, 2007, the 9th Circuit upheld the FCC’s decision preempting state regulation of VoIP. This article further explains the court's decision to uphold.