Regulators consider the future of VoIP

European regulators and network operators recently gathered in Brussels to consider the future regulation of voice over Internet Protocol -- VoIP.

The hearing, held in March, focused on recommendations set out in a study prepared for the European Commission that was published earlier this year. Guidance from the Commission on how the new e-communications regulatory package should be applied to IP-based services is expected to follow. The regulatory treatment of these services will be key to the viability of these emerging new business models.

Context
VoIP describes the use of Internet Protocol to transmit voice calls over the Internet in packets of data (like sending an email) instead of connecting a call conventionally, over a single open circuit. VoIP has been hailed as one of the major applications of broadband Internet. Examples of VoIP services -- which may be based on any one of at least five different business models -- include Kazaa's peer-to-peer service "Skype" and BT's new product due to be launched later this year, BT Communicator. Such services are also referred to as voice over broadband -- or "VoB".

In the United States, where VoIP looks set to take off more swiftly than in Europe, state and federal regulators have begun to consult on the extent to which such services should be regulated as "common carriers". Early indications are that the Federal Communications Commission may adopt a "light touch" approach, but there are concerns over, among other things, the potential loss in tax revenues, and the negative impact on universal service obligations.

Key issues and recommendations
The focus of the recent hearing in Brussels was a recently published report by consultants Analysys, commissioned by the Information Society Directorate of the European Commission. Olswang was among the interested parties represented.