NETWORK WORLD NEWSLETTER: STEVE TAYLOR AND LARRY HETTICK ON 
CONVERGENCE
11/03/04
Today's focus:  VoIP fees and regulations

Dear [EMAIL PROTECTED],

In this issue:

* Vonage's fees; FCC Chairman Powell on regulations
* Links related to Convergence
* Featured reader resource
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Today's focus:  VoIP fees and regulations

By Steve Taylor and Larry Hettick

Last time, we compared taxes and fees assessed on MCI and Cox 
Communications phone bills. Today, we'll look at what Vonage 
adds, and what FCC Chairman Michael Powell has to say about 
Internet telephony taxes and regulation.

Vonage has a $24.95 basic plan that includes unlimited local and 
North American long distance; the plan also includes standard 
custom calling features and voice mail. Unlike with MCI and Cox, 
the Vonage list of added fees is short.

Since Vonage is providing an application on the Internet, it has 
thus far avoided regulatory requirements for most of the taxes 
and surcharges traditional service providers collect. Therefore, 
Vonage only adds a 3% federal excise and a $1.50 regulatory 
recovery fee to its standard service. New Jersey residents are 
also required to pay a 6% sales tax since Vonage is based in New 
Jersey.

Some states and federal officials would like to add charges and 
further regulate IP telephony (IPT) service providers. However, 
Powell is on the side of less tax and less regulation for IPT.

In a speech at the Fall VON 2004 trade show, Powell noted "how 
important it is for government to nurture the Internet as a 
platform for innovation and entrepreneurial activity."

He continued: "It's wrong, just plain wrong, to not recognize 
the potential of VoIP, or to see it through the lens of the old 
telephone network regulatory model. VoIP is a data application 
and as such has all the hallmarks of the Internet itself."

He added that "to hold that packets flying across national and 
indeed international digital networks should be subject to state 
commission economic regulatory authority is to dumb down the 
Internet to match the limited vision of government officials. 
That would be a tragedy. I look forward to working with my... 
colleagues to ensure that a minimal, well-harmonized regulatory 
environment is applied to VoIP services."

While regulatory questions like lawful wiretaps and E-911 
support are still up for discussion and decisions, it looks like 
IPT has a powerful ally to avoid the substantial taxes and 
surcharges many states would like to add to your phone bill.

Next time, we'll take a look at some interesting trials that 
bring wireless and wireline network services together.

RELATED EDITORIAL LINKS

FCC chair advocates hands-off approach to VoIP
Network World Fusion, 10/19/04
http://www.nwfusion.com/edge/news/2004/1019fccvon.html
_______________________________________________________________
To contact: Steve Taylor and Larry Hettick

Steve Taylor is President of Distributed Networking Associates 
and Publisher/Editor-in-Chief of Webtorials.Com. For more 
detailed information on most of the topics discussed in this 
newsletter, connect to Webtorials.Com 
<http://www.webtorials.com/>, the first Web site dedicated 
exclusively to market studies and technology tutorials in the 
Broadband Packet areas of Frame Relay, ATM, and IP.  He can be 
reached at <mailto:[EMAIL PROTECTED]> 

Larry Hettick an industry veteran with over 20 years of 
experience in voice and data.  He is currently Vice President 
for Wireline Solutions at Current Analysis, the leading 
competitive response solutions company. He can be reached at 
<mailto:[EMAIL PROTECTED]> 
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This newsletter is sponsored by NetScout 

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ARCHIVE LINKS

Archives of the Convergence newsletter: 
http://www.nwfusion.com/newsletters/converg/index.html
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