LIGHT WIRELESS REGULATORY TOUCH CITED AS VoIP EXAMPLE AT CTIA

ATLANTA -- Top FCC officials at the CTIA Wireless 2004 show here Mon. held up the agency’s relatively hands-off wireless regulatory regime as an example that could be followed in the VoIP arena. Citing the benefits of a “light regulatory touch” on VoIP, Chmn. Powell also told a standing- room-only opening session: “This industry has to wake up to the fact that it [VoIP] can be an incredible innovation to the wireless side.” He noted that by some estimates there’s more VoIP running over wireless networks than on wireline.

“VoIP is one of the most disruptive technologies to come along in a long time,” Powell said. “I think it’s short- sighted to see it as some new way or more efficient way to do traditional telephone service. There is another emerging killer application that is demonstrated time and time again and we are about to go through another major rip and replace revolution… When you begin to understand voice over IP not as telephony but just as an another Internet application capable of being partnered with other Internet applications, then you see its real potential and the real challenge in trying to treat it as a narrow telephony bucket.”

In response to a question by CTIA Pres. Steve Largent, Powell said he didn’t think it was “inevitable” that wireless would be subject eventually to a “traditional, utility-like” regulatory regime as the sector continues to grow. There’s a risk that as an industry matures and moves away from being an innovative service to one with mass market appeal, it draws more attention from both customers and the govt., Powell said: “I think it’s yours to lose, and I don’t think you will… I really think this industry is serving in some ways as an example of a competitive model, a lightly regulated model, that is actually producing great dividends. I think a lot of regulators actually look to this industry for examples of how to use this regulatory approach for other innovative services.”

In a wide-ranging Q&A, Largent stressed to Powell that some wireless CEOs were concerned that if they become involved in voluntary efforts in areas such as Amber Alert, that could lead to mandatory requirements. One concern expressed by some industry participants at the show is that broader emergency alert system requirements would be technically difficult to fulfill. Several carriers are now offering Amber Alerts in voluntary trials, including one in Fairfax Co., Va. “The industry does have a soul. There are certain things that are right for the industry to do,” Powell said. On an issue like Amber Alert, “it’s good business and it’s good corporate citizenship to be able to use your service to advance the public welfare without the public welfare always being associated with the government.” Wireless technology’s ability to reach 160 million subscribers makes it a “very powerful network,” he said.

“This industry is really in some ways serving as an example of a competitive model, a lightly regulated model that is actually producing great dividends,” Powell said, speaking at his 7th CTIA show: “I think a lot of regulators look to the wireless industry for examples of how to actually use this regulatory approach for other innovative services.” Powell cited the wireless industry’s voluntary consumer code of conduct, which covers service quality issues such as customer trial periods, as an example of industry tackling problems involving consumers without regulatory intervention.

FCC Wireline Bureau Chief William Maher, echoing comments at a recent Commission forum by Comr. Abernathy, said during a separate panel Mon. that the light-handed regulatory approach the FCC has followed for wireless is a good example for VoIP generally. Maher told an FCBA lunch at the show that the flip side is that VoIP “is probably a way in which you [the wireless industry] will be subject to more competition” as cable operators and others roll out voice offerings.

“There’s some interesting relationships and lessons that can be learned from the wireless experience and applied to voice over IP,” said FCC Chief of Staff Bryan Tramont. For social obligations such as disability access and Enhanced 911, the FCC staggered some requirements for wireless carriers, Tramont said.

“One of the questions we are struggling with is how do those other mandates apply and then to what degree do you try to take advantage of the nimbleness associated with the new application and make an enhanced CALEA or an enhanced E911 or enhanced disability access part of what those new applications are,” Tramont said. “The DoJ petition and our rulemaking will be another effort to try to find where the starting point is for a regulatory regime that acknowledges the distinct technical characteristics but doesn’t overreach… in terms of the scope of the obligation imposed on a new technology.” One part of this dynamic is that in the mostly deregulated wireless sector and in the VoIP arena, the FCC has largely taken a minimalist regulatory approach, but these areas are increasingly falling under federal rather than state purview, he said. “So there is an interesting irony there in that as we become more deregulatory” and as some innovative services become more ubiquitous, “there is increased pressure to federalize,” Tramont said. “It’s an interesting tension and decision point for you as to how much you want to push to federalize a regime unless you have the FCC taking on fraudulent advertising or sundry other things. There are some trade-offs there.”

In other areas, Carolyn Brandon, CTIA vp-policy, noted wireless carriers and infrastructure providers are assessing the potential implications of a massive filing recently made by law enforcement agencies, including the Justice Dept. They petitioned the FCC for a wide range of CALEA (Communications Assistance for Law Enforcement Act)-related changes (CD March 15 p2). “One of the fears in looking at the breadth and the scope of the petition is the requirements they are suggesting the carriers go through in terms of getting pre-approval essentially for deployment of any new IP-based technology,” Brandon said. Julius Knapp, deputy chief of the FCC’s Office of Engineering & Technology, said part of the challenge of dealing with CALEA is that the law is 10 years old. It balanced issues such as privacy, the ability of law enforcement to deploy wiretaps, evolving technology and the associated costs of providing law enforcement such access, Knapp said. The FCC plans to hold a CALEA workshop in May and will address the balance of issues as it considers the broad petition for rulemaking submitted by DoJ and the FBI, he said.

The sheer scope of the CALEA petition submitted by DoJ and the FBI tees up a large range of CALEA-related issues with which the FCC has dealt, Maher noted. “This is an opportunity” for those interested in these issues to express their views, he said. “This is when the public has to step up. No matter where you come out on CALEA, this is a very, very important opportunity,” he said.

On the wireless implications of a Telecom Act rewrite being taken up by Congress sometime this year, FCC Consumer & Governmental Affairs Bureau Chief Dane Snowden said the issue of state pre-emption was one that would be likely to surface. “The issue of disability access is another one that will be hotly debated,” he said.

In other areas, CTIA’s Brandon noted that among concerns of wireless carriers are the more than 300 petitions pending from rural LECs as a May 24 deadline approaches for wireless local number portability being available outside the top 100 markets. Brandon asked whether that volume of waiver petitions before state PUCs could undermine enforcement of that deadline by contributing to customer confusion. Snowden said the FCC has been tracking filings to it and the states regarding the next round of LNP obligations. Snowden said the agency’s concern is that consumers be made aware of the process to eliminate confusion. Maher said many state commissions had been among the most vocal advocates of wireless LNP being made available in the first place. “I guess I'm hoping that the states follow through on that commitment,” he said.

On the intercarrier compensation proceeding now before the FCC, Maher said FCC staff has its ideas on the rulemaking based on the record, although he noted an industry forum has been working on a proposal to bring to the Commission. If industry files something by the end of April, which Maher said he hoped, the agency will consider it. If not, FCC staff will continue to analyze the issue and make recommendations, he said. Maher noted that Powell has indicated he would like to take action in this area in 2004.

Separately, Tramont said the FCC still aims to bring a proposal for mitigating public safety interference at 800 MHz to a vote for the April meeting. “It’s a very complicated proceeding. If it takes longer, it will take longer,” he said.