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FCC Fines Company for Blocking Access to VoIP 294

Posted by Zonk
from the strike-one dept.
peg0cjs writes "According to PCPro, the FCC has handed out a $15,000 fine to Madison River Communications Corp for blocking access to VoIP calls. The action is seen as a warning to other telcos not to prevent the growth of VoIP over their networks. The complaint was made to the FCC by two companies Vonage Holdings and Nuvio, which specialise in VoIP services. It appears that Vonage CEO Jeffrey Citron was willing to act on his earlier tirade about VoIP blocking." From the article: "The action is seen as a warning to other telcos not to prevent the growth of VoIP over their networks. Many of these companies see VoIP as a threat to their landline revenues as calls made over the internet can be made to anywhere in the world for the price of a local call."
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FCC Fines Company for Blocking Access to VoIP

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  • by tekiegreg (674773) * <tekieg1-slashdot@yahoo.com> on Friday March 04, 2005 @02:54PM (#11846276) Homepage Journal
    Is something like me getting a $10 parking ticket, annoying but hardly worth acting on beyond mailing the puppy in...though I suppose the command to change policy as such will have an effect...
  • by worst_name_ever (633374) on Friday March 04, 2005 @02:55PM (#11846286)
    But I thought we hate the FCC! I just don't know what to believe anymore!
    • But I thought we hate the FCC! I just don't know what to believe anymore!

      We hate the FCC when they are an obstacle to free speech, not when they are fining others for being obstacles to new tech.

      In this case, they did the right thing by protecting the lil' guy. But in the cases where they want to tell you what your content can or can't be, as Eric Idle says: fuck you very much, the FCC [pythonline.com].
    • by JudgeFurious (455868) on Friday March 04, 2005 @03:33PM (#11846706)
      I don't know how many times I have to go over this with you people but I'm going to make this sink in if it takes me the rest of my life. On FRIDAYS, after lunch (US, Central time) we like the FCC, if it's an even number day and a story critical of something Apple did earlier in the day is posted while at the same time there are no stories about SCO or the RIAA.

      I don't know if a RAMBUS story has any effect on whether or not we like the FCC, give me a few minutes to call somebody and double check the fine print of the Slashdot Manifesto.
    • You need to adjust the contrast on your moral monitor. Morality's color depth is deeper than 2 bits; it's at least 8 bit greyscale. Just because someone/some group/something irritates you to extreme levels 80% of the time doesn't remove your ability to be pleased the other 20% of the time.
  • Mail and Web Servers (Score:4, Interesting)

    by varmittang (849469) on Friday March 04, 2005 @02:55PM (#11846290)
    So, can I use this precedence to have them unblock port 25 and 80 so I can run my mail and web server without any problems?
    • by over_exposed (623791) on Friday March 04, 2005 @03:16PM (#11846535) Homepage
      Not if you agreed to the TOS that you wouldn't run any servers while connected to their service...

      $20* says that is probably in your contract while restrictions on VOIP are nowhere to be found.

      The $20 mentioned is simply a euphamism for a congratulatory high-five.
      • Not if you agreed to the TOS that you wouldn't run any servers while connected to their service...

        Yes, normally you have to follow your contracts (even unwritten contracts).

        However, if the FCC says it has to be done one way, then contract be damned, you do it the way the FCC says it.
    • by PepeGSay (847429) on Friday March 04, 2005 @03:21PM (#11846586)
      There is a common misconception that the origianl issues with blocked VoIP calls originated at the ISP level. Let me repeat: "It did not occur at the ISP level.". It was blocked inside the phone network of the Telco, which is entirely different on many many levels. This precedence is unrelated to your ISP's regulation of your ports.
      • There is a common misconception that the origianl issues with blocked VoIP calls originated at the ISP level. Let me repeat: "It did not occur at the ISP level.". It was blocked inside the phone network of the Telco, which is entirely different on many many levels.

        Thank you, thank you, thank you. Very, very informative.

        The FCC is did not fine an ISP here- they fined a telephone company for what they were doing with their telephone services!! It all makes so much more sense now...

    • I'm guessing they would make the argument that they already offer you email and web hosting as part of their service. Maybe they'll try the same thing for VoIP - with of a 10 megs of included web hosting space they give X megs of transfer time over a VoIP port. But then they would have to get into the business of VoIP -- so they might as well try to block it.
    • In major markets, there are so many possibilities these days for ISPs, I'm not sure why people accept this crap from providers. Sure, Comcast and Earthlink don't allow this, so why use them? CenturyTel has no problem with my mail and web server, and for a very low $5 more a month even provides me with a static IP.
  • by kidgenius (704962) on Friday March 04, 2005 @02:55PM (#11846294)
    Good to see the FCC actually doing something that gives consumers choice. Now only if we could get them to drop the stupid broadcast flag.
  • Pocket change (Score:3, Insightful)

    by Kimos (859729) <[moc.liamg] [ta] [todhsals.somik]> on Friday March 04, 2005 @02:56PM (#11846297) Homepage
    IANAL, but I assume the fine goes way up from there, right? If it cuts into the telco's bottom line so much $15,000 isn't a big price to pay to block it.
    • This is a small rural telco, and only 200 people were affected. That amounts to $75/person. If Verizon were to be fined at the same rate per person, that would probably amount to tens of millions.

      More importantly, IMHO, is the message this sends to other telcos.
  • by Stanistani (808333) on Friday March 04, 2005 @02:56PM (#11846300) Homepage Journal
    Thanks!
    In my next postings I will include encoded voice messages as a series of ASCII tokens.

    Better not mod them down, or you'll be fined for impeding competition...

    (and yes, this is not meant seriously)
  • Fine Money? (Score:4, Interesting)

    by Anonymous Coward on Friday March 04, 2005 @02:57PM (#11846316)
    Just something I've been wondering. Where does all of this money from fines go to? Janet Jackson netted the FCC some pretty decent change, so what happened to it?
    • Damned good question. Where are the mod points?
    • Re:Fine Money? (Score:4, Informative)

      by The-Perl-CD-Bookshel (631252) on Friday March 04, 2005 @05:24PM (#11848096) Homepage Journal
      The regulatory offices are included in the budget and they total around 29billion worth of spending. However, they usually levy enough fines to pay for themselves and then some. If you look at the federal income statement there is a section for revenues from regulations (though they don't explicitly call it that). Pretty much, it suppliments your tax dollers for such programs so that beurocrats (non-elected officials) can spend more.

      The whole idea of regulations, while necessary because corporations always try to defeat them, are kind of circular. We are paying to protect ourselves...from ourselves!

  • Good! (Score:5, Interesting)

    by TGK (262438) <Killfile@Nephand u s .Com> on Friday March 04, 2005 @02:57PM (#11846325) Homepage Journal
    I for one am sick of corps trying to preserve dieing business models by abusing existing power structures.

    It will be interesting to see what will become of information infrastructure in this country in the next few years. IBM v Microsoft of the early 21st century is going to be Cable v. Telephone. Where it goes depends on the rules of the game. This decision firmly establishes that network transparency won't be sacrificed in the fray.
    • by Engineer-Poet (795260) on Friday March 04, 2005 @03:23PM (#11846612) Homepage Journal
      The price of LD service has been falling steadily for years, but the drop to zero (and the end of the telco's cut for handling it) is going to throw a lot of revenue models in the trash. So what could happen?
      • Revenue falls below the price of service, companies go out of business.
      • Per-line fees are increased to make company profitable, more customers jump ship to cell service for voice calls, more and more landline infrastructure goes unused, fees are increased... death spiral.
      • Companies try to offer new services but are stuck in regulatory limbo while competitors get to market first.

      Then there's the issue with overseas service. The undersea cables are supported with revenue from phone calls, and bandwidth is limited. Financing cables with the "all you can eat" Internet model is going to be interesting.

      I don't see any way this can be good for local telcos, and maybe not for overseas carriers either. It may be time to sell any shares you own.

      • Overseas (well, underseas) cables to the US tend to be financed by the non-US end. And people buy bandwidth on them. They're supported by phone service charges inasmuch as running phone service requires purchasing capacity on them, in the same way that running internet service over them requires purchasing capacity on them.

        But I don't see what this has to do with flat-fee internet charging at all.
  • by Jailbrekr (73837) <jailbrekr@digitaladdiction.net> on Friday March 04, 2005 @02:59PM (#11846345) Homepage
    The smart ones throttle back the quality of the connection. Thanks to the bursty nature of the internet, they can get away with making the quality total shit for 3rd party VoIP providers, while allcocating the necessary bandwidth and priority to their own VoIP services.

  • by Calimus (43046) <<calimus> <at> <techography.com>> on Friday March 04, 2005 @03:01PM (#11846370) Homepage
    It's a no brainer that voIP is where things are going to end up. The simple solution is for the telco's to jump on that poney and ride it to the bank. The R&D is already done, the equipment prices have come down. While I don't have any figured to work with, I'm sure the return on investment if they plan correctly can't be that bad.

    It's like the US post office issue, e-mail is causing them to loose money. Simple solution. USPS internet kiosks where you pay for time to use their system to access your e-mail. Those that don't have laptops/handhelds but have $1 for 30min of time would jump on it. The market is there, just have to have the right bait to real them in. Problem is that telco's like the USPS have been doing things the same way for so long, change is a very painfull process. Welp, take a pain pill and get moving you corporate lackies.
    • It's a no brainer that voIP is where things are going to end up.

      It's a no brainer? Really? Where will it end up then? My stock portfolio would really like to know.

      There are the backbone providers who are also telcos, like AT&T and Sprint. Some of these companies are in cellular, like Sprint, others like AT&T have dumped their wireless holdings and only want to be in IP services. There are the Vonages of the world, companies who go and create pricing models based on tarrifs and pass domestic ca
      • I have no doubt that ultimately everything (audio, video, text, unicast and broadcast) will be over the same network (eg. 200 years in the future) due to economies of scale, and will be relatively open, as that yields much greater economic growth. However, as you say, in the near-to-medium-future, all sorts of legislative barriers may be put up to prevent the unification of the networks. And ultimately, there will definitely be SOME amount of control, at least by the government, since as the network grows
    • I don't think it's like the USPS at all. First, the USPS is intended to be more of a public service the a profitable business (like public transportation or something). So I hope they won't be too worried about "loosing" money or developing alternative business models if their current one becomes obsolete. Second, until we invent teleporters, we'll still need to send things through the USPS, UPS, or FedEx. You know, "things", like actual physical things.
    • It's like the US post office issue, e-mail is causing them to loose money.

      While postage rates have gone up a bit, I don't think that email is causing the USPS to LOSE that much money. The vast majority of mail is junk mail. While logically one might think that these people have just switched over to spam, a lot of junk mail is regional (grocery circulars, etc.) and can't be easily turned into spam. Furthermore, there's a lot of people without computers, so if you move to spam you drop a lot of your target
  • by VE3ECM (818278) on Friday March 04, 2005 @03:02PM (#11846374)
    I don't know about you, but I've never heard of 'Madison River Communications Corp'...
    Sounds like a small fish in the pond. A 15K fine is definitely going to make them pay attention.

    And it's going to make the big players sit up and take notice.

    Think of this more as a "warning shot across the bow" than a slap on the wrist.

  • A start... (Score:2, Insightful)

    by ksilebo (134470) *
    Its a move in the right direction, but to the bigger telcos, $15,000 isn't that big of a hit. Especially when doing something blatantly unethical.
  • Dupe? (Score:3, Insightful)

    by charlie763 (529636) on Friday March 04, 2005 @03:03PM (#11846381) Homepage
    "The action is seen as a warning to other telcos not to prevent the growth of VoIP over their networks" Does this count as a dupe or will it need to read that quote a third time?
  • FCC is very soft! (Score:3, Insightful)

    by bogaboga (793279) on Friday March 04, 2005 @03:03PM (#11846385)
    The FCC should fine this company US$15,000 per blocked call and the fine should attract interest at current rates. If this company has pockets as deep as those of M$, I suggest going further and holding the executives to account. I hope I am not being too "right wing" or extremist.
    • The FCC should fine this company US$15,000 per blocked call and the fine should attract interest at current rates. If this company has pockets as deep as those of M$, I suggest going further and holding the executives to account. I hope I am not being too "right wing" or extremist.

      corporate responsibility, regulation, right wing? Furthur proof that the right/left distinction becomes more meaningless every day.
  • That's not a fine. (Score:4, Insightful)

    by mhollis (727905) on Friday March 04, 2005 @03:03PM (#11846391) Journal

    $15,000 is hardly a significant threat to a telco, it's more like a "warning ticket" given to a speeder that the cop is good buddies with.

    When I think of the fines imposed on Howard Stern, it convinces me that they're not all that serious about limiting challenges to VOIP.

  • Don't VOIP packets require higher priority than normal to keep quality decent? If so, how does everyone who is doing regular IP operations feel about their jobs being delayed in order to provide priority to VOIP users?
    • The Quality of Service server is in your home, not running at your ISP. It pushes up the priority on data sent and requested from your home, so if you're downloading something it won't make your phone sound like shit.
      • I'm a network engineer and planner for a VoIP provider, and despite years in this business, I have no earthly idea what you're calling a "QoS server".

        You are, well, "so very wrong" about what goes on with popular consumer VoIP products like Vonage.

        Vonage uses Session Initiation Protocol (SIP) for call signalling and service feature delivery. Media Terminal Adaptors (MTAs), often also referred to as Analog Telephone Adaptors (ATAs), adapt analog voice media into Real-time Transport Protocol (RTP) media st
    • IIRC VOIP uses only 16kbps (someone will surely correct me if I'm wrong). So even if its packets get "priority" do VOIP calls really have that much impact? At least so far?

      This (undated) article quoting Jupiter Research:

      http://www.etmag.com/publication/magazine/2004- 1 1/ 70.htm

      says only "1% of U.S. broadband households (or 400,000 households)" currently use VOIP.

      The research, however, also says that VOIP will jump to 17% will jump to 17% of broadband households over the next five years.

      Then things will
  • by Specks (798579) on Friday March 04, 2005 @03:06PM (#11846423)
    As this recent article from Robert X. Cringely [pbs.org] says, all the the big telephone and cable TV companies have to do is tag their packets and the result:

    Tagged packets get both less restrictive rules for passage and a private highway lane to drive on.

    Robert X. Cringely

    The result from that. Companies like Vonage and Packet8 are crippled and it's legal too.
  • in not being inhibited. Many countries use the telephone system as a cash cow and as such, because there has been no competition, they have REALLY sub par POTS. VoIP would really cut into that revenue they generate from telephone calls making their government suffer. In the US the telephone company really is the last big holdout in the great analog to digital migration. It doesn't make sense that I can chat with my friends halfway around the world on my PC but get totally reamed when I call home to talk to
  • by gothzilla (676407) on Friday March 04, 2005 @03:11PM (#11846485)
    Commenting on the case the FCC Chairman Michael K. Powell said, `the industry must adhere to certain consumer protection norms if the Internet is to remain an open platform for innovation.` He also gave a warning that the FCC will not allow companies to stifle innovation saying that the Commission `acted swiftly to ensure that Internet voice service remains a viable option for consumers`. I think that line might be brought up in the future...can you say broadcast flag?
    • Commenting on the case the FCC Chairman Michael K. Powell said, `the industry must adhere to certain consumer protection norms if television is to remain an open platform for innovation.` He also gave a warning that the FCC will not allow companies to stifle innovation saying that the Commission `acted swiftly to ensure that time shifting remains a viable option for consumers`.

      Something like that? Don't hold your breath.
  • We've seen many dupes lately here on slashdot, so this is a welcome non-dupe, however, anyone else find it weird that in such a short summary there is essentially a dupe of the sentences from the article?

    "According to PCPro, the FCC has handed out a $15,000 fine to Madison River Communications Corp for blocking access to VoIP calls. The action is seen as a warning to other telcos not to prevent the growth of VoIP over their networks. The complaint was made to the FCC by two companies Vonage Holdings and
  • by windowpain (211052) on Friday March 04, 2005 @03:15PM (#11846527) Journal
    I understand that ATT&T has pretty much abandoned circuit switching. Hasn't it already written off its entire circuit-switched physical plant?

    This FCC decision lets ILECs know they dare not interfere with VOIP.

    Quo Vadis?

    When will the last circuit switched call in America be made? What will become of all that infrastructure? Or are reports of its death highly exaggerated?
  • by hirschma (187820) on Friday March 04, 2005 @03:20PM (#11846579)
    My girlfriend moved into a swanky building with broadband pre-installed.

    One day, she can't send email anymore via an external server set up to allow relay after POP authentication. Verizon has blocked all outgoing SMTP because most of their users have become spam-spewing zombies. It was easier for them to do this rather than turn off individuals.

    Seriously, can my girlfriend complain to the FCC about this? Or, because email isn't as easily monetized a service as VOIP, they simply won't care?

    jh
    • by Fulcrum of Evil (560260) on Friday March 04, 2005 @03:29PM (#11846664)

      Seriously, can my girlfriend complain to the FCC about this?

      Maybe she should talk to verizon first. They probably have proxies set up for outbound traffic.

    • Verizon has blocked all outgoing SMTP... an my girlfriend complain to the FCC about this?

      Probably not. I mean, you can always complain, but the chance of action is nil.

      The FCC is only on this because it's cross-state-lines voice traffic.

      They're not concerned with your girlfriend sending text via a server she's probably not supposed to be running ( by contract stipulation ) anyway. They _should_ be concerned about it, but this whole area is new and different to the FCC, and they don't really know what shou

    • It is all in the intent. In blocking port 25, Verizon is not attempting to use their strength to block competing services. They are trying to block spam.

      It is pretty clear in this case that the telco was attempting to hamstring a competing product.

      Now, if Verizon was charging a per-email fee to use their own mail servers and blocking access to external mail servers, the situation may be more comparable.
    • Seriously, can my girlfriend complain to the FCC about this?
      Even better, she could set up her mail client to connect to her external server via the mail submission port 587 rather than the (blocked) mail relay port 25.

  • :P I'm actually guessing Vonage is completely down since multiple people can't ping them right now and my phone just gives me a busy tone when I dial a number. This is great, now I get to rely on Comcast, a Netgear Router, VOIP adapter, and vonage to be able to make a phone call....
  • by sxmjmae (809464) on Friday March 04, 2005 @03:26PM (#11846641)
    I think control of VoIP is outside the mandate of the FCC.

    New companies that offer VoIP are not covered by the FCC. These are companyies are "common carriers" and protected by there laws.

    You either have FCC regulation and the protection of the "common carriers" laws or your on your own. For example is you are VoIP company and not considered a "common carrier" then If someone uses VoIP for criminal reasons you could be considered part of the facilitator. Common Carrier status protects a carrier from legal liability for what it transports.

    The legal liability of allowing someone who is 'legal liability' for what it transports to use your lines from which you are protected via the common carrier status has interesting consequences. For example: if a 3rd party VoIP provider (who is not regulated and is not Common Carrier) allows a kidnapper to make a ransom demand to through its VoIP line then over a common carrier lines then who is responsible?

    Just becuase a company is protected by the Common Carrier status does not mean it should extend to the 3rd party VoIP provider who use there lines.

    An very interesting legal point if the FCC is trying to make the Common Carriers accept 3rd party VoIP calls.

    Allowing 3rd party VoIP providers to use Common Carrier lines puts unacceptable risk or damage upon the Common Carrier and hence they should be legally allowed refuse service to such parties.

    • I'll ignore the legal liability of the VoIP network for calls over their network (I've no idea whether they do in fact have common carrier status, or something like it, and I'm certainly not qualified to comment on that)

      My understanding of the common carrier status of the provider though, is that they do not look at what they transport, so cannot be held liable for the contents. So if they're port blocking a competing service, that means they're intefering, and thus ignoring the very fact that makes them c
  • My vonage lines at home now do not work (with a fast-busy when I try to dial in), and I cannot connect to www.vonage.com from my office. Coincidence?
    • by Ravn0s (212743)
      I noticed that too...

      From the Vonage [vonage.com] site:

      Customers may be experiencing an issue with receiving inbound calls and placing outbound calls due to a network issue. This problem is also impacting availability of our web site.

      Our engineers are aware of the issue and are working to resolve it as quickly as possible. We apologize for any inconvenience.
  • About a year ago, Earthlink suddenly (and without prior notification) started to block traffic to destination port 25 (SMTP).
    This blocked me from sending emails tagged as originating from my domain name.

    I voted with my feet and am now a happy customer of Sonic.net (based in Santa Rosa, but serving the Greater Bay Area).
    But I am still pissed off about Earthlink blocking traffic to destination port 25 (SMTP) and would enjoy it if a regulatory agency fined them.
    $15000 seems like a joke, though.

  • by frieked (187664) on Friday March 04, 2005 @03:34PM (#11846713) Homepage Journal
    I'm a vonage user, after logging into the website I'm greeted with this, coincidence?:

    Service Announcements

    Customers may be experiencing an issue with receiving inbound calls and placing outbound calls due to a network issue. This problem is also impacting availability of our web site.

    Our engineers are aware of the issue and are working to resolve it as quickly as possible. We apologize for any inconvenience.
  • FCC love? (Score:3, Funny)

    by zerofoo (262795) on Friday March 04, 2005 @03:38PM (#11846752)
    So, do we love the FCC today or do we still hate them?

    -ted
  • Why should the telcos be forced to carry a service that undercuts their own telephony operation? It's like movie theaters being forced to allow patrons to bring in their own food.
    • Re:Devils Advocate (Score:3, Interesting)

      by Queuetue (156269)
      I agree. Movie theaters should be required to allow people to bring thier own food. This will drive them to charge fair prices + "convenience" cost.

      The abuse of the concession monopoly is one of many reasons I no longer go to the movies.
  • by realmolo (574068) on Friday March 04, 2005 @03:42PM (#11846812)
    I work for a small cable provider. We also offer cablemodem service and phone service, all over the coax network. We make more money *per-customer* on the phone service than anything else.

    Vonage isn't available in our area yet, but when it comes, our phone service is absolutely fucked. Vonage is what, $25/month for unlimited calls? We charge that much for 500 minutes of calls per month. And, of course, long distance is extra.

    But you know what? I don't care. Vonage and it's ilk are GOOD THINGS. There's no reason that all communications systems shouldn't move to IP-based networks. Yeah, it's going to be the end of the "small" service providers, but so what? They're living on borrowed time anyway.

    I'm just waiting for high-speed wireless internet to become ubiquitous. Once everyone can snag a couple of megabits out of the air no matter where they are, even the cell phone companies are going to be screwed. Unless, of course, they become wireless internet providers. Which is what they should do, of course.
  • by Gadgetfreak (97865) on Friday March 04, 2005 @03:52PM (#11846954)
    Instead of embracing the new technology, adopting it, and even selling/profiting from it... they decide to stifle it and bludgeon it with a stick in the hopes that it will die and people won't talk about it anymore.

    They need to learn to appropriately respond to what the market wants, not control what they can get.

    • They need to learn to appropriately respond to what the market wants, not control what they can get.

      This is where the problems lies tho.... The music industry couldn't provide what people want because ultimately people wanted (and got) free music. Sure they could have dropped CD prices a bit and tried to prevent the rush but once people hear the word "free" it was all over for the RIAA and their friends.

      Can the telcos honestly lower prices enough to compete with VOIP? The VOIP company gets away with char
    • They need to learn to appropriately respond to what the market wants, not control what they can get.

      Well Telco's Are a regulated entity, and can only charge what they have Tariffs for, and they need to go to the regulators to get the tariffs approved.

      Vonage is not regulated, it is a communications service, not a telephone service (at least that is what the flyer that came with my vonage phone said), so it plays by different rules. The problem here is that on 1 side it wants to be an unregulated comp
  • Phonecompanyisp: Block VOIP, no one is using our phone services anymore.

    FCC: Nope can't do that, Won't let ya.

    PhoneCompanyISP: Ok, Charge $.0002 per each packet.

    PostOffice: Hey give us $.0001 per packet because no one sends regular mail anymore!

    User: What!! $18.00 Dial up
    $18.00 90,000 packets @ .0002 each
    $36.00 total.

    (bill used to only be $18.00)

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