Here's the elevator speech (might take a very tall building to carry out):
1. The FCC wants to make sure that the universal service program doesn't run out of money.
2. The universal service program has historically been funded by enormous access charges paid by long distance companies to local phone companies.
3. Long distance companies want to make calls look local so they don't have to pay these enormous access charges.
4. One way long distance companies can implement "access avoidance" is to insert an IP section into their call pathway. Then they can say that the call isn't really a public switched telephone network call at all. It's a VoIP call, which should be lightly regulated (if at all).
5. VoIP (voice over IP) lobbyists have said that all IP-enabled services are the same, in that they all involve packets traveling over the internet, and so VoIP shouldn't be discriminated against in a regulatory sense just because it involves voice.
6. But if most telephone calls are made over the internet-based network, the universal service program will run out of money.
7. FCC has started dealing with this problem by nibbling at two ends of the continuum: Pulver, which looks just like Napster and doesn't use the PSTN, won't be regulated. But ATT's VoIP, which looks just like a telephone call with a little internet thrown in, and does use the PSTN, will be regulated.
8. What does it mean to be "regulated"? That's what the IP-enabled services NPRM is all about. There, the FCC is proposing a discussion about social policy goals for all IP-enabled services:
E911 and public safety issues (should all IP-enabled applications be able to call the police?);
Disability access (should all IP-enabled applications be able to support screen-reading and avoid graphical interaction?);
Payment of access charges to local phone companies (should all IP-enabled applications have to pay access charges?);
Payment for universal service obligations (should all IP-enabled applications have to fund universal telephone services?);
Tariffing and preemption and CALEA (should all IP-enabled services have to be tariffed, and should state regulatory roles be preempted, and should CALEA obligations apply to them?); and
Consumer protection (should all IP-enabled services have to provide standardized protection for personally-identifiable information, and meet other desirable consumer protection standards that are established -- such as prohibiting slamming and supporting "portability"?)
9. Meanwhile, the 9th Circuit has said in the BrandX case that cable modem service is a telecommunications service, despite FCC efforts to say that it isn't. Some portions of the FBI must be delighted with this holding, because it means that these sorts of services will be subject to CALEA -- meaning that these services can't be designed without making it possible for the FBI to have a back door. Some portions of the DOJ will never give up on pushing for this.
10. So the FCC is being pushed towards "regulation" of ip-enabled services from two directions: Universal service has to be paid for, and the DOJ has to have access. The ip-enabled services NPRM provides a menu of things that might happen, and we can't predict that all of these regulatory elements would be applied to, say, email, but there are powerful institutional reasons for the FCC to take a heavy hand.
Three questions for the demos:
1. Why do we assume that the universal service program has to be funded? Is this an untouchable third rail? Are there other ways to provide communications services to rural areas?
2. Why does the FBI assume that it should have CALEA interests in every application that rides over the internet? Is this another example of the "new normal"? Is there any link between all of this and the DOJ push for increased copyright police powers?
3. If the ATT VoIP petition is easy, and the Pulver petition is easy (ends of the continuum), what about everything in the middle? What about PCs or handheld devices (which don't look like phones) providing applications that do everything a phone does, plus text and graphics and IM and anything else you can think of?
(plus, isn't the WWW an "IP-enabled application"? what about the DNS?)