Challenges of Convergence

1
Challenges of Convergence

• J. Scott Marcus
• Senior Advisor for Internet Technology
• Federal Communications Commission (FCC)
• The opinions expressed are my own, and do not
  necessarily reflect the views of the FCC or the
  U.S. Government.

2
Policy Challenges

• Convergence as a challenge to the regulator
• IP Telephony
• ENUM
• Broadband - cable versus DSL

3
Convergence as a Challenge to the Regulator

• Technology changes quickly.
• Regulation changes slowly.
• The Telecom Act of 1996 is based on definitional
  categories.
• Definitions are blurring together.
• A possible approach Regulate the service, not
  the underlying technology.
• Where this is not possible, expect
• opportunities for regulatory arbitrage
• irrational results

4
IP Telephony

• An innovative, competitive and important service.
• Has flourished in a largely unregulated
  environment.
• Ongoing international pressure to rethink
  regulatory status.

5
U.S. Policy on IP Telephony

• No recent official statements.
• Stevens Report (April, 1998)
• Where both sides are telephones, IP telephony
  bears many characteristics of a
  telecommunications service however, we must
  consider specifics on a case-by-case basis.
• Where at least one side is a computer, IP
  telephony should not be viewed (at present) as a
  telecommunications service.
• IP telephony does not directly contribute to the
  Universal Service Fund (USF), but underlying
  components (e.g. private lines) do thus, IP
  telephony does not necessarily generate a net
  reduction in the USF.
• IP telephony serves the public interest by
  placing significant downward pressure on
  international settlement rates and consumer
  prices.

6
European Commission Policy

• 1998 notice concluded that Internet voice
  services do not constitute voice telephony
  UNLESS
• they are offered commercially and separately to
  the public as voice services
• they are provided to and from PSTN termination
  points and
• they are offered in real time at the same level
  of speech quality and reliability as is offered
  by the PSTN.
• January, 2001 communication reaffirmed the 1998
  position observed, however, that the quality of
  IP telephony over a single network has improved.
• As the EC migrates to a new telecommunications
  regulatory framework, the subject will be
  reevaluated using methods borrowed from
  competition law.

7
IP Telephony and the ITU

• Significant interest within the International
  Telecommunications Union (ITU) in defining
  Internet telephony and IP telephony.
• Many members would like to make IP telephony
  subject to international accounting rates.
• ITU Study Group 2 recently declined to create
  definitions, observing that Internet telephony
  should not be viewed as a service.

8
ENUM - a Pandoras Box

• The Internet versus the PSTN
• Global Internet versus national numbering plans
• ITU versus IETF
• Free market mechanisms versus government
  regulation
• Incumbents versus insurgents
• Centralized versus decentralized control
• Issues of security, hijacking, privacy, SPAM,
  slamming, and number portability ...

9
U.S. Industry Recommendation

• ITAC-T Advisory Committee to Department of State
• Recommends that the U.S. participate in a global
  global ENUM implementation rooted at e164.arpa.
• Notes the need for open competition, especially
  at ENUM Tier 2, and recognizes that other ENUM
  domains are not precluded.

10
Position of U.S. ITU Delegation

• Supportive of a global tree under e164.arpa
• Recognition of sovereign rights of nations to
  choose to opt in or not
• Allow for competition wherever possible
• Promote interworking between different approaches
  and systems
• Cooperation between IETF and ITU
• Market-based system with minimal regulatory
  intervention
• Must not be inconsistent with
• competition in telecommunications
• encouragement of innovation
• promotion of advanced data services

11
Broadband

• Categorization of cable access to IP services is
  uncertain
• Categorization of telephony over cable is
  uncertain
• High Speed NOI in process

12
Where to from Here?

• Technology will continue to change quickly.
• Regulation will continue to change slowly.
• For now, there is no panacea, no silver bullet.