The LA Times ran a good story today on how the House telecom bill–thanks to a last-minute amendment–may raise the price of Internet phone calls. The provision reaffirms state authority to require voice-over-Internet providers to pay into universal service funds and to pay access fees to wireline carriers. In so doing, the bill apparently overturns an FCC decision two years ago preempting the states from such matters.
The cost could be significant. According to the article, the additional subsidy payments could increase VoIP bills some 7 percent. Summarizing the reaction of the VoIP community, Jeff Pulver said of the move: “It got me to the point of absolute depression.”
Similar provisions are in the latest telecom bill draft released this weekend by Senator Ted Stevens. That bill would, among other things, impose universal service obligations on services that are “effective substitutes” for inter-exchange telecommunications services (read: VoIP).
Proponents of subjecting VoIP to these fees argue, not entirely without merit, that it would be unfair to tax other types of telecom and not VoIP. But there are better ways to avoid distortions – among them, eliminating subsidies entirely, an option somehow overlooked in congress’ bills. The access fee issue is more difficult, since these fees are imposed by carriers, rather than the government. But n any case, given the interstate nature of these services, turning over these decisions to the states is troublesome, to say the least.
Certainly something to watch.
The Technology Liberation Front is the tech policy blog dedicated to keeping politicians' hands off the 'net and everything else related to technology.