Thursday, October 02, 2003

Techweb > News > California to VoIP Operators: You’re Regulated > California to VoIP Operators: You're Regulated > October 2, 2003

Techweb > News > California to VoIP Operators: You’re Regulated > California to VoIP Operators: You're Regulated > October 2, 2003: "California to VoIP Operators: You're Regulated
October 2, 2003 (11:34 a.m. EST)
TechWeb News

The party's over for voice-over IP (VoIP) providers. The California Public Utilities Commission has decided to treat Internet Protocol providers like all other telephone providers. Plainly put, VoIP providers will henceforth be regulated in the state.
While a few smaller states--Wisconsin and Minnesota, specifically-have previously announced that VoIP firms would be regulated, California, because of its size, is likely to influence other states, and possibly even federal regulators.
California's telecommunications division said this week that major VoIP providers, including Vonage, VoicePulse, SBC Communications, Net2Phone and Packet8, have been told to apply for telephone-operator licenses. The action is a disappointment for the VoIP companies, which had argued that they should remain unregulated because their traffic moves over the Internet.
The VoIP market has been a brawling affair, and its future course is still unclear, although no one doubts that it will continue to grow rapidly. Market research estimates are all over the place, but the consensus is that the Internet-phone market--now placed at just under $2 billion a year--will double in two or three years.
Equipment suppliers, in fact, are rushing handsets to market. For instance, Cisco Systems Inc. introduced a $600 VoIP handset this summer, and Toshiba Corp. has signaled that it will soon begin marketing a $800 combination PDA-VoIP phone that will also download web pages. More cautious are others like Comcast, which this week said it will begin testing VoIP next year at the earliest. "

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