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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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  • Good (Score:1, Interesting)

    by whitelabrat (469237) on Friday March 04, 2005 @02:54PM (#11846277)
    Those of us who use VoIP should be friendly neighbors and use compression if possible to conserve bandwidth?
  • 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?
  • 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?
  • Good! (Score:5, Interesting)

    by TGK (262438) <Killfile@Nepha[ ]s.Com ['ndu' in gap]> 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 kidgenius (704962) on Friday March 04, 2005 @02:59PM (#11846344)
    I know that telco's are fairly large, but this seems to be a rather small telco. They deal only with rural customers. To them, $15,000 is quite a bit more than it would be to someone like Qwest, Verizon, Cox, Comcast, etc. But, it shows the big boys that the FCC will not tolerate these actions. You probably could expect a much larger fine to one of them, especially if it's more than 200 customers that get blocked.
  • by Calimus (43046) <calimus@nosPam.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.
  • 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.
  • 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?
  • by Jailbrekr (73837) <jailbrekr@digitaladdiction.net> on Friday March 04, 2005 @03:13PM (#11846512) Homepage
    It helps that I work in telecommunications. Only regulations can force the ISPs to ensure a QoS which will make VoIP viable for 3rd party providers, and the lack of regulations is the one key component which makes VoIP so cheap when compared to the traditional phone companies. Its a catch 22, and this is why I'm not worried about watching the company I work for go bankrupt.
  • 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 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.
  • 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 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.

  • 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.

  • by Harry Balls (799916) on Friday March 04, 2005 @03:31PM (#11846687)
    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.
  • Re:Good (Score:2, Interesting)

    by northcat (827059) on Friday March 04, 2005 @03:41PM (#11846796) Journal
    • Grandparent is not telling you not to use VoIP. It's telling you to compress data and save bandwidth.
    • Conserving bandwidth is like conserving fuel - yes, you do have the right to take as much as you want from your seller, but conserving preserves the resource for all of us and it's a good idea. Otherwise it will be costly for all of us -- or at least someone else.
    • There's no need for *you* to compress anything since it's all part of the standard.
    • How the fuck is grandparent offtopic??
  • by Ravn0s (212743) <azreel@freespiritmind.com> on Friday March 04, 2005 @03:51PM (#11846933) Homepage
    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.
  • Re:Devils Advocate (Score:3, Interesting)

    by Queuetue (156269) <scott@pantasFORT ... m minus language> on Friday March 04, 2005 @04:04PM (#11847113) Homepage
    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 javaxman (705658) on Friday March 04, 2005 @04:19PM (#11847297) Journal
    Cox, Comcast, etc.

    Cox and Comcast aren't phone companies. My understanding is that the fine was for a phone company blocking voice traffic... not for an Internet Service Provider blocking data traffic. A ( somewhat ) fine, yet important distinction that I think is lost to many.

  • by javaxman (705658) on Friday March 04, 2005 @05:24PM (#11848107) Journal
    That might be news to the folks paying them for phone service.

    Please, feel free to enlighten me. I get my cable internet from Comcast, but do they provide phone service elsewhere? Is it 'real' phone service, or bundled VOIP ( not that I know the FCC makes a distinction ) ?

    Comcast doesn't provide phone service in my area, if they provide it elsewhere... I don't know about Cox, either. But my point, that this fine was imposed because of voice network restrictions, not data network restrictions, is still valid, I suppose... and yea, it's a weird distinction...

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