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November 8, 2005

FCC relaxes VoIP 911 deadline but imposes marketing gag

VoIP providers in the US won't have to disconnect subscribers if they do not receive the same 911 emergency services as traditional telephony users, federal regulators have ruled.

By CBR Staff Writer

But VoIP vendors will be prohibited from marketing or accepting new customers in areas where they do not connect 911 calls with the subscriber’s phone number and physical location.

This is the first time the FCC has ever taken this type of position before and it certainly appears to be somewhat protectionist for the cable companies and RBOCs [regional Bell operating companies], said Jason Talley, chief executive of independent VoIP company Nuvio Corp, based in Kansas.

Initially, the Federal Communications Commission’s rules adopted in May required VoIP vendors to cut off service to customers who did not receive enhanced 911 or E911 service by November 28.

The FCC’s goal was to eliminate existing 911 limitations for some VoIP users, after a series of high-profile incidents in the US. There were tragic cases earlier this year, for instance, where some VoIP calls were not routed to appropriate 911 staff but instead to an answering machine.

However, many vendors said compliance with the November 28 deadline would be technically difficult and costly. So much so that Nuvio and others last week asked a district Court of Appeals for a partial stay of the FCC order, calling the initial rules arbitrary and untenable. To comply, Nuvio would have had to disconnect roughly 70% of its customers.

Indeed, roughly 750,000 of the estimated 2.5 million VoIP users in the US would likely not have E911 service by the end of the month, according to the Voice On the Net Coalition.

But the FCC’s new marketing cease-and-desist order is cause for concern for independent VoIP companies.

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The problem is the resistance by some RBOCs and incumbent local exchange carriers, or ILECs, to give independent VoIP vendors easy access to their 911 infrastructure.

Talley said Nuvio has attempted to negotiate with many RBOCs and ILECs. And to date none of them have been forthcoming or easy to deal with, he said. The FCC’s marketing gag removes any incentive for RBOCs or ILECs to negotiate in good faith with VoIP companies to provide 911 technology access, he said. As soon as E911 solutions are available in those markets, all of a sudden they have competition, he said.

To get around the problem, Nuvio has turned to third-party E911 service providers, which has created a significant cost to Nuvio, Talley said.

Chris Murray, VP for government affairs at the largest VoIP provider in the US, Vonage Holdings Corp, said the company’s network is ready to deploy E911 services but is being held back by certain RBOCs, such as SBC Communications.

Initially, SBC told Vonage it would not provide it with a key technical element needed to complete its E911 service, known as pseudo ANI. Since then, SBC has worked to provide Vonage a linear process to access this technology, but it has been slow going.

Murray said SBC’s cooperation has been in stark contrast to Verizon Communications Inc’s, which accounts for most of Vonage’s customer territory or about 38%. Because of Verizon’s cooperation, Murray said Vonage would have E911 services for all its customers in Verizon territories by the end of the month.

Vonage expects to have E911 in all its markets by the end of February. That is, if other carriers are cooperative in sharing their 911 technology and the FCC makes good on its promise to set up a P-ANI administration, Murray said.

In other words, Vonage won’t be marketing in SBC territories, which account for roughly one quarter of its customers, for another few months or so.

The commission has asked us to stop building our business during the holiday, Murray said. And for us to be held accountable for access that we’ve not been given is ridiculous.

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