VoIP deregulation conversation in MN Senate Committee (Mar 9 Notes)

Today I attended the Committee on Energy and Utilities Finance and Policy. Where Representative Ruud led a discussion on 1742-Ruud: Voice-over-Internet protocol service and Internet protocol-enabled service regulation prohibition.

Here’ the video & handouts:

The quick take is that the providers would like to lessen regulations on VoIP phone calls and would like to widen definition of VoIP calls to include essentially any phone call – because most phone calls happen via broadband connections at some point. The opposition is wary that consumer protections will be reduced with this new bill. There is a special consideration for seniors for whom a landline phone really is a lifeline. Also this is a topic that is coming up in Federal discussions so there is some hesitation on some parts to make a decision that may be contrary to a federal decision.

In the end, they decided to hold the bill over.

And full notes:

Thursday, March 9, 2017 – 1:00 PM
Committee on Energy and Utilities Finance and Policy
Chair: Sen. David J. Osmek 1 p.m.
Room 1150 Minnesota Senate Bldg.

S.F. 1742-Ruud: Voice-over-Internet protocol service and Internet protocol-enabled service regulation prohibition.

A1 Amendment added

About amendment – we worked with people. There ere concerns about consumer protections so we added some language. Also we added language to indicate that we would not be removing land lines

Tony Mendoza –

From cable association – we strongly support this. 237 is based on laws that are old – when there was one provider in any areas. Now we have competition. Internet has changed the way we make telephone calls. VOIP runs like other applications on broadband – like email or social media. But email and social media are not regulated like phone calls.

Vonage challenged the PUC and the PUC lost. Right now some VOIP providers are regulated and some are not. It doesn’t make sense to subject one provider and not another

Protections –

  • Carrier of last resort is still maintained.
  • FCC and Attorney General both regulate for consumers.
  • Competition Choice is also a strong tool.

More people will have access to more competitive options if VOIP is unregulated. Studies have shown that consumers

It strengthens 911, and MN TAP. All VOIP providers will participate in 911 and Universal service funds.

Regulatory details are stifling deployment and innovation. It is freezing broadband investment in the state.

We cannot let regulation stand in the way of expansion.

This would align MN with federal policies.

John Dukich – MHTA

MHTA sent a letter in support of 1742. (See handouts.) It lets people know that MN embraces technology-friendly policy – like 30 other states have done.

Q Simonson – what is the correlation between this regulation and investment?
There are 3 key services that broadband provider serve: broadband, voice, video. Voice is a key part of the revenue stream that providers can earn. There examples where regulatory delay has lost business. It’s hard to compete with Vonage when the have different rules; with the same rules we can better compete.

Q – Seniors are concerned about landlines. Can seniors keep phones with this new regulation?
We don’t think the bill does this but we added the amendment to give confidence to seniors that the landlines will remain. (1.9-1.12 in the amendment – “landline services will not be impacted”)

Opponents complain that as everyone moves to IP that this is meaningless – but the FCC must approve a movement to get out of the phone market.

Ron Elwood of Legal Aid

This is a tough subject and a lot of eyes glaze over. We don’t want to lose the forest from the trees. We’re talking about a local telephone call. The technology is changed but the service we’re talking about in the bill is the same. There are a lot of ways to get from St Paul to Mpls – there are a lot of ways to make a phone call – but it’s really a matter of routes to the same destination.

This bill eliminates the PUC oversight of phone calls. We need

I have a list of 35 protections that would be lost

* No advance warning for turning a phone off. CenturyLink says in their contract that they can turn off your bill with no notice.

(See handouts for full list)

This is in front of the Feds now. This case turns on a definition from the 1996 Telecom Act. It’s being decided now. We think the MN legislature shodul defer to the federal decision. The providers say they want certainty in legislation – really they don’t want legislation at all.

Since other state have made changes they have found – more 911 issues, more outages, fewer jobs.

IN urban areas consumers have choice – changing status of VOIP is not likely to increase investment. In rural areas competition lags because of economics not because of VOIP regulations. Those in rural areas will suffer the most. They may end up with the option of a cell phone only, which is spotty and unreliable.

Mary Jo George of AARP

We appreciate the amendment. BUT VoIP is a landline, it’s just an alternative route. For seniors – they need consumer protections. It is a lifeline – for emergencies, healthcare and contact with the outside. We want to maintain the service quality rules. No unwanted charges. No turn off of service overnight. This is not in the public interest. Many states deregulated before they knew the implications – the dangers of power outages.

This does not impede broadband investment.

Bill Grant (Energy and telecommunication at Dep of Commerce)

We support the opposition here. These are common sense protections that Minnesotans should have. Like being entitled to a refund, not paying for services you didn’t request, can’t turn off service during off times (over a holiday weekend), same changes for same service regardless of consumer location.

Technology changes are not a good reason to get rid of consumer protections.

Electric vehicles will probably get the same rules as other cars. Seatbelts are seatbelts. Same with phone calls. If the services are the same shouldn’t consumer protections be he same.

Vonage is nomadic VOIP, not fixed VOIP.

Q – Osmek – If I want to get new services on my landline will I get it?
Yes today – but services are changing.

Q – Goggin – So Vonage is nomadic? Why is that OK?
I didn’t say it was – but I think that fixed decision will be different.

Q – Martin – Why is this coming up again after last year? I’m concerned about protections. They are worthwhile.
I think the amendments take care of some of these issues. But maybe folks didn’t get to see this. I don’t think we are taking away protections.

NO we haven’t had time to see the amendment – it would be good to get our notes to you.

Q – Simonson – If there are federal decision n process now – why take this up now?
Yes this is in federal court – but the issue is very technical (is there a distinction between fixed and nomadic VOIP) we think it’s important here because of the policy. We think the legislature is the place to discuss policy. The decision was made about nomadic – it’s done and federal.

It highlights the point that things re happening outside of this room that may have an impact. The legal question is a sound one. We need public input. Maybe we could hold off on a further stop for this bill.

Q- Goggin – about nomadic – if CenturyLInk decided to do what Vonage does – would that fall under a nomadic definition?
If they wanted to modify their technology I guess they could. but they don’t want to. There are technical distinctions in the types of service and we don’t think it makes sense to regulate differently.

Osmek  – I don’t think we want to hold off to wait for Federal decision.  We could add comfort language to align with the feds.

The bill will be held over.

This entry was posted in Conferences, MN, Policy by Ann Treacy. Bookmark the permalink.

About Ann Treacy

I have a Master’s Degree in Library and Information Science. I have been interested or involved in providing access to information through the Internet since 1994, when I worked for Minnesota’s first Internet service provider. I am pleased to be a part of the Blandin on Broadband Team. I also work with MN Coalition on Government Information, Minnesota Rural Partners, and the American Society for Information Science and Technology.

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