Communications Law Prof. Karl Manheim Spring, 2006 20: Broadband Voice Over Internet (VoIP)
Overview <ul><li>Broadband defined </li></ul><ul><ul><li>High speed access to the Internet </li></ul></ul><ul><ul><ul><li>...
Broadband to the Home Monitoring  Station Electric line Cable Headend Cable Base Station Satellite Central Office Phone li...
The “Last Mile” <ul><li>The physical problem </li></ul><ul><ul><li>Internet backbone is comprised mostly of fiber optic li...
The “Last Mile” <ul><li>The economic problem </li></ul><ul><ul><li>Cable/telcos are monopolies </li></ul></ul><ul><ul><ul>...
The “Last Mile” <ul><li>The regulatory problem (solution) </li></ul><ul><ul><li>Cable </li></ul></ul><ul><ul><ul><li>Video...
Case Study - Cable Broadband <ul><li>Physical Capacity </li></ul><ul><ul><li>Each video channel (@6 Mhz/each) redeployed f...
Case Study - Cable Broadband <ul><li>Interconnection (& price) regulation </li></ul><ul><ul><li>Telecommunications Provide...
NCTA v. Brand X   (Supreme Ct 2005) <ul><li>FCC rulemaking post  AT&T v. Portland </li></ul><ul><ul><li>Cable broadband is...
DSL <ul><li>Line sharing </li></ul><ul><ul><li>Voice transport uses low frequency signal </li></ul></ul><ul><ul><ul><li>Or...
DSLAM
DSL <ul><li>Unbundling requirements for ILECs </li></ul><ul><ul><li>TCA requires incumbents to lease “unbundled” network e...
FCC DSL Ruling   (Mar. 25, 2005) <ul><li>How does unbundling apply to DSL? </li></ul><ul><ul><li>Line sharing order (1999)...
Wireless Broadband <ul><li>Mobile </li></ul><ul><ul><li>Cellular (3G) </li></ul></ul><ul><ul><li>Air-Ground </li></ul></ul...
Voice over Internet (VoIP) <ul><li>Technology </li></ul><ul><ul><li>Packet Switching </li></ul></ul><ul><ul><ul><li>Analog...
Voice over Internet (VoIP) <ul><li>Technology </li></ul><ul><ul><li>Voice  ≠  POTS telephony </li></ul></ul><ul><ul><li>In...
 
Voice over Internet (VoIP) <ul><li>Economics </li></ul><ul><ul><li>Because internet telephony bypasses telcos, </li></ul><...
Voice over Internet (VoIP) <ul><li>Regulatory issues generally </li></ul><ul><ul><li>Internet not under FCC or NRA jdx, or...
VoIP Regulation <ul><li>NPRM:  IP-Enabled Services  (3/10/2004) </li></ul><ul><ul><li>WC Docket 04-36 (19 FCC Rcd. 4863) <...
VoIP Regulation <ul><li>Pulver.com Free World Dialup (2004) </li></ul><ul><ul><li>C-C VoIP is </li></ul></ul><ul><ul><ul><...
VoIP Regulation <ul><li>Order re AT&T Access Charges  (4/21/2004) </li></ul><ul><ul><li>AT&T uses Internet to route intere...
VoIP Regulation <ul><li>Order in Vonage VoIP Services  (11/9/2004) </li></ul><ul><ul><li>LECs normally subject to state PU...
VoIP Regulation <ul><li>E911 Services </li></ul><ul><ul><li>Interconnected VoIP E911 order (6/3/05)  < link > </li></ul></...
Convergence Telephony Data Traditional View Cable Broadcast Wireless
Convergence Data Voice Web Email Reality Video File  Transfer Content Cable Wireless Satellite Fiber Devices Apps Users
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  • High Frequency Loop Spectrum
  • Broadband

    1. 1. Communications Law Prof. Karl Manheim Spring, 2006 20: Broadband Voice Over Internet (VoIP)
    2. 2. Overview <ul><li>Broadband defined </li></ul><ul><ul><li>High speed access to the Internet </li></ul></ul><ul><ul><ul><li>Faster than “dial-up” </li></ul></ul></ul><ul><ul><ul><li>Typically 128 kb/s, up to several Mb/s </li></ul></ul></ul><ul><li>Technologies </li></ul><ul><ul><li>Fiber </li></ul></ul><ul><ul><li>Dedicated copper (e.g., T1 (1.5kbs) or T3 (7.5+) ) </li></ul></ul><ul><ul><li>Cable (coaxial) </li></ul></ul><ul><ul><li>DSL (phone line) </li></ul></ul><ul><ul><li>Wireless (fixed and mobile) </li></ul></ul>
    3. 3. Broadband to the Home Monitoring Station Electric line Cable Headend Cable Base Station Satellite Central Office Phone line Mobile Switching Center Wireless
    4. 4. The “Last Mile” <ul><li>The physical problem </li></ul><ul><ul><li>Internet backbone is comprised mostly of fiber optic lines (wires) </li></ul></ul><ul><ul><ul><li>Throughput in terabytes (1000s of gigabytes) / sec </li></ul></ul></ul><ul><ul><ul><li>Ample for any foreseeable telecom need / technology </li></ul></ul></ul><ul><ul><li>Fiber terminates at telco facility (switching office) </li></ul></ul><ul><ul><ul><li>Bringing fiber into home or office is very expensive </li></ul></ul></ul><ul><ul><ul><ul><li>~$4,000 per termination </li></ul></ul></ul></ul><ul><ul><li>Last mile is usually copper wire </li></ul></ul><ul><ul><ul><li>Coaxial or phone line </li></ul></ul></ul><ul><ul><ul><li>Owned/operated by cable/telco </li></ul></ul></ul>
    5. 5. The “Last Mile” <ul><li>The economic problem </li></ul><ul><ul><li>Cable/telcos are monopolies </li></ul></ul><ul><ul><ul><li>With high capital investment costs </li></ul></ul></ul><ul><ul><li>Can reap monopoly rents </li></ul></ul><ul><ul><ul><li>By keeping competitors out </li></ul></ul></ul><ul><ul><ul><li>By bundling services </li></ul></ul></ul><ul><ul><ul><ul><li>Transport services </li></ul></ul></ul></ul><ul><ul><ul><ul><li>ISP services (internet, email) </li></ul></ul></ul></ul><ul><ul><ul><ul><li>Value added services (chat, etc) </li></ul></ul></ul></ul>
    6. 6. The “Last Mile” <ul><li>The regulatory problem (solution) </li></ul><ul><ul><li>Cable </li></ul></ul><ul><ul><ul><li>Video services (must carry) vs. broadband </li></ul></ul></ul><ul><ul><ul><ul><li>Interconnection (unbundling) requirements? </li></ul></ul></ul></ul><ul><ul><ul><li>Local regulation limited to franchising authority </li></ul></ul></ul><ul><ul><li>Telephone </li></ul></ul><ul><ul><ul><li>Interconnection (unbundling) requirements </li></ul></ul></ul><ul><ul><ul><ul><li>Telecom Act: to enable competition in telephony </li></ul></ul></ul></ul><ul><ul><ul><ul><li>Does this apply to DSL? </li></ul></ul></ul></ul><ul><ul><ul><li>Price Regulation (e.g., by PUC or FCC) </li></ul></ul></ul>
    7. 7. Case Study - Cable Broadband <ul><li>Physical Capacity </li></ul><ul><ul><li>Each video channel (@6 Mhz/each) redeployed for Internet use could service 20-50 customers </li></ul></ul><ul><ul><ul><li>@ $30-50 each per month </li></ul></ul></ul><ul><ul><ul><ul><li>Capitalized present value = $10,000 per customer </li></ul></ul></ul></ul><ul><li>Portland Case </li></ul><ul><ul><li>City of Portland mandated “open access” </li></ul></ul><ul><ul><ul><li>Cable companies must rent transport space to ISPs </li></ul></ul></ul><ul><ul><ul><li>Pursuant to local franchise regulatory authority </li></ul></ul></ul><ul><ul><li>AT&T claims preemption by TCA and FCC reg. </li></ul></ul>
    8. 8. Case Study - Cable Broadband <ul><li>Interconnection (& price) regulation </li></ul><ul><ul><li>Telecommunications Providers (LECs): Yes </li></ul></ul><ul><ul><li>Cable companies: No </li></ul></ul><ul><ul><li>Information Service Providers: No </li></ul></ul><ul><li>AT&T v. Portland (9 th Cir. 2000) </li></ul><ul><ul><li>Cable broadband both telecom and info service </li></ul></ul><ul><ul><ul><li>As telco, competitors had interconnection rights (enforceable through FCC), but Portland preempted </li></ul></ul></ul><ul><ul><ul><li>As info service, AT&T not subject to regulation </li></ul></ul></ul><ul><ul><li>No local regulatory authority over cable b’band </li></ul></ul>
    9. 9. NCTA v. Brand X (Supreme Ct 2005) <ul><li>FCC rulemaking post AT&T v. Portland </li></ul><ul><ul><li>Cable broadband is “information service” </li></ul></ul><ul><ul><li>Vacated by 9th Cir. </li></ul></ul><ul><ul><ul><li>Selected by lottery (multidistrict litigation) </li></ul></ul></ul><ul><li>Chevron issues </li></ul><ul><ul><li>Whether TCA is clear on “telecom service” </li></ul></ul><ul><ul><ul><li>If so, earlier 9th Cir. decision is binding </li></ul></ul></ul><ul><ul><ul><li>If not, courts should defer to agency expertise (once rulemaking proceedings are complete) </li></ul></ul></ul><ul><ul><li>Should S.Ct. reexamine Chevron deference in light of agency capture? </li></ul></ul>
    10. 10. DSL <ul><li>Line sharing </li></ul><ul><ul><li>Voice transport uses low frequency signal </li></ul></ul><ul><ul><ul><li>Ordinary “dial-up” Modem uses same low frequency </li></ul></ul></ul><ul><ul><ul><li>Limited to 56 kb/s </li></ul></ul></ul><ul><ul><li>High frequency signal can be sent on same line </li></ul></ul><ul><ul><ul><li>Throughput typically at least 384kb up; 128kb down </li></ul></ul></ul><ul><ul><li>Signals must be combined/split at both ends </li></ul></ul><ul><ul><ul><li>Home: DSL modem </li></ul></ul></ul><ul><ul><ul><li>CSO (telco office): line filter before switches </li></ul></ul></ul><ul><ul><ul><ul><li>DSLAM (Digital Subscriber Line Access Multiplexer) (“stinger”) </li></ul></ul></ul></ul><ul><ul><ul><ul><li>Packet switching networks </li></ul></ul></ul></ul>
    11. 11. DSLAM
    12. 12. DSL <ul><li>Unbundling requirements for ILECs </li></ul><ul><ul><li>TCA requires incumbents to lease “unbundled” network elements (UNE) to competitors </li></ul></ul><ul><ul><ul><li>Local loop, switches, databases </li></ul></ul></ul><ul><ul><ul><li>Goal: to foster competition </li></ul></ul></ul><ul><ul><ul><li>Price control </li></ul></ul></ul><ul><ul><ul><ul><li>by state PUCs per FCC formula </li></ul></ul></ul></ul><ul><ul><ul><ul><li>TELRIC (cost recovery) </li></ul></ul></ul></ul><ul><ul><li>Unbundling removes ILEC monopoly, even though it still owns the physical infrastructure </li></ul></ul>
    13. 13. FCC DSL Ruling (Mar. 25, 2005) <ul><li>How does unbundling apply to DSL? </li></ul><ul><ul><li>Line sharing order (1999) </li></ul></ul><ul><ul><ul><li>High freqency portion of loop is a “network element” </li></ul></ul></ul><ul><ul><ul><li>ILECs must lease HFLS to CLEC data services </li></ul></ul></ul><ul><ul><ul><ul><li>Whether or not CLEC is also providing voice services </li></ul></ul></ul></ul><ul><ul><ul><ul><li>That’s why Yahoo, AOL, etc. can provide DSL services over your local telcos local loop </li></ul></ul></ul></ul><ul><ul><ul><li>But DSLAM and packet switching are not UNEs </li></ul></ul></ul><ul><ul><ul><ul><li>CLECs can provide own switching equipment (collocation) </li></ul></ul></ul></ul><ul><ul><li>Must ILEC offer HFLS to CLEC voice customers? </li></ul></ul><ul><ul><ul><li>No; nothing in TCA requires ILECs to provide DSL </li></ul></ul></ul>
    14. 14. Wireless Broadband <ul><li>Mobile </li></ul><ul><ul><li>Cellular (3G) </li></ul></ul><ul><ul><li>Air-Ground </li></ul></ul><ul><ul><ul><li>800 MHz band (previously cellular - AMPS) </li></ul></ul></ul><ul><ul><ul><li>Auction pending </li></ul></ul></ul><ul><li>Fixed </li></ul><ul><ul><li>Broadcast (2dary) </li></ul></ul><ul><ul><li>MMDS </li></ul></ul><ul><ul><li>Satellite </li></ul></ul>
    15. 15. Voice over Internet (VoIP) <ul><li>Technology </li></ul><ul><ul><li>Packet Switching </li></ul></ul><ul><ul><ul><li>Analog voice signal converted to digital signal, which is then broken into data “packets” </li></ul></ul></ul><ul><ul><ul><li>Packets sent over Internet like other data </li></ul></ul></ul><ul><ul><ul><li>Reverse process at destination computer </li></ul></ul></ul><ul><ul><li>Transmission </li></ul></ul><ul><ul><ul><li>Computer-to-computer (end-to-end) </li></ul></ul></ul><ul><ul><ul><ul><li>Can be over same physical backbone as voice telephony </li></ul></ul></ul></ul><ul><ul><ul><ul><li>But bypasses PSTN, IXCs (DSLAM collocation at LEC) </li></ul></ul></ul></ul><ul><ul><ul><li>Phone-to-phone </li></ul></ul></ul><ul><ul><ul><ul><li>Uses Internet in lieu of IXC; otherwise works like telephony </li></ul></ul></ul></ul>FCC website on IP-enabled services
    16. 16. Voice over Internet (VoIP) <ul><li>Technology </li></ul><ul><ul><li>Voice ≠ POTS telephony </li></ul></ul><ul><ul><li>In an end-to-end world, applications are defined at the edges </li></ul></ul><ul><ul><li>Innovation happens </li></ul></ul>
    17. 18. Voice over Internet (VoIP) <ul><li>Economics </li></ul><ul><ul><li>Because internet telephony bypasses telcos, </li></ul></ul><ul><ul><ul><li>No interconnection obligations, recip. compensation </li></ul></ul></ul><ul><ul><ul><ul><li>Exception: VoIP call from or to standard telephone (e.g., “Computer-to-Phone”, “Phone-to-Phone”) </li></ul></ul></ul></ul><ul><ul><ul><ul><li>Termination charges apply </li></ul></ul></ul></ul><ul><ul><ul><li>No Universal Service surcharges </li></ul></ul></ul><ul><ul><li>Competitive pressure on wireline/wireless telcos </li></ul></ul><ul><ul><ul><li>Telcos demand compensation from ISPs </li></ul></ul></ul><ul><ul><ul><li>Telcos urge regulation of VoIP </li></ul></ul></ul>
    18. 19. Voice over Internet (VoIP) <ul><li>Regulatory issues generally </li></ul><ul><ul><li>Internet not under FCC or NRA jdx, or otherwise subject to government regulation </li></ul></ul><ul><ul><ul><li>Advent of unregulated services, displacing regulated ones, may require general deregulation </li></ul></ul></ul><ul><ul><li>VoIP defies national boundaries </li></ul></ul><ul><ul><ul><li>Users are “nomadic” whenever on Internet </li></ul></ul></ul><ul><ul><ul><ul><li>Phone numbers are portable (globally) </li></ul></ul></ul></ul><ul><li>Skype </li></ul><ul><ul><li>C-C (free) C-PSTN (traffic-sensitive fee) PSTN-C (nts) </li></ul></ul>
    19. 20. VoIP Regulation <ul><li>NPRM: IP-Enabled Services (3/10/2004) </li></ul><ul><ul><li>WC Docket 04-36 (19 FCC Rcd. 4863) </li></ul></ul><ul><ul><li>Focus on VoIP </li></ul></ul><ul><ul><ul><li>Offered by telcos and facilities-based telecom cos. </li></ul></ul></ul><ul><ul><ul><li>Also by Session Initiated Protocol (SIP) providers </li></ul></ul></ul><ul><ul><li>Beyond VoIP </li></ul></ul><ul><ul><ul><li>TTY, VPN, IPTV, VOD, </li></ul></ul></ul><ul><ul><ul><li>Disability Services ( VoIP Summit – 5/7/2004) </li></ul></ul></ul><ul><li>First Report and Order (6/3/2005) </li></ul><ul><ul><li>Limited to E911 service </li></ul></ul>
    20. 21. VoIP Regulation <ul><li>Pulver.com Free World Dialup (2004) </li></ul><ul><ul><li>C-C VoIP is </li></ul></ul><ul><ul><ul><li>Not telecommunications </li></ul></ul></ul><ul><ul><ul><ul><li>VoIP is merely an application (such as a browser, email) </li></ul></ul></ul></ul><ul><ul><ul><ul><li>Not a transmission service </li></ul></ul></ul></ul><ul><ul><ul><li>Not a telecommunications service </li></ul></ul></ul><ul><ul><ul><ul><li>VoIP providers don’t offer telecommunications </li></ul></ul></ul></ul><ul><ul><ul><ul><li>No common carrier obligations </li></ul></ul></ul></ul><ul><ul><ul><li>An information service </li></ul></ul></ul><ul><ul><ul><ul><li>capability for generating, acquiring, storing, transforming, processing, retrieving, utilizing info via telecommunications </li></ul></ul></ul></ul>
    21. 22. VoIP Regulation <ul><li>Order re AT&T Access Charges (4/21/2004) </li></ul><ul><ul><li>AT&T uses Internet to route interexchange calls </li></ul></ul><ul><ul><ul><li>LEC -> VoIP -> LEC </li></ul></ul></ul><ul><ul><ul><li>Bypasses IXC and IXC obligation to compensate destination LEC to terminate calls, but otherwise looks identical to wireline telephony (incl. CPE) </li></ul></ul></ul><ul><ul><ul><li>So-called “Phone-to-Phone” </li></ul></ul></ul><ul><ul><li>No reason to treat termination any differently </li></ul></ul><ul><ul><ul><li>AT&T must pay access charges </li></ul></ul></ul><ul><ul><ul><li>Order doesn’t apply to Computer-to-Computer VoIP </li></ul></ul></ul>
    22. 23. VoIP Regulation <ul><li>Order in Vonage VoIP Services (11/9/2004) </li></ul><ul><ul><li>LECs normally subject to state PUC regulation </li></ul></ul><ul><ul><ul><li>Joint State Federal Board </li></ul></ul></ul><ul><ul><ul><li>Separation requirements </li></ul></ul></ul><ul><ul><li>C-C VoIP bypasses LECs; therefore not subject to state regulation </li></ul></ul><ul><ul><ul><li>E.g., E911 services </li></ul></ul></ul>
    23. 24. VoIP Regulation <ul><li>E911 Services </li></ul><ul><ul><li>Interconnected VoIP E911 order (6/3/05) < link > </li></ul></ul><ul><ul><li>Joint FCC/NARUC Task Force (July 2005) </li></ul></ul><ul><ul><li>IVoIP compliance required by 11/28/06 < link > </li></ul></ul><ul><ul><ul><li>Appeal pending before DC Court of Appeals </li></ul></ul></ul>
    24. 25. Convergence Telephony Data Traditional View Cable Broadcast Wireless
    25. 26. Convergence Data Voice Web Email Reality Video File Transfer Content Cable Wireless Satellite Fiber Devices Apps Users

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