Level 3 withdraws VoIP petition
Telecom carrier Level 3, which connects calls from voice-over-IP (VoIP) providers such as Vonage to the traditional public switched telephone network (PSTN), on Monday withdrew its forbearance petition that asked the FCC to rule that VoIP calls are not subject to interstate or intrastate access charges.
Rules regarding forbearance petitions would have required the FCC to rule on the matter yesterday or the Level 3 request would have become effective automatically. Complicating matters was last week’s appointment of Kevin Martin as FCC chairman, replacing VoIP advocate Michael Powell.
“Level 3 has withdrawn the petition in deference to the Commission,” Level 3 CEO James Crowe said in a prepared statement. “Given the appointment of new leadership only three business days before the statutory deadline for ruling on the petition, we determined it was inappropriate to ask the agency to resolve this important issue in the timeframe required by law.”
Crowe indicated that the decision was made in consultation with VoIP allies such as the VON Coalition and Comptel/Ascent. He also said Level 3 may refile the petition, although it would be 15 months before the FCC would be obligated to make a decision on the matter.
VoIP providers that do not pay access charges on PSTN are able to offer consumers cheaper phone rates than traditional telecom carriers. Most analysts believe this advantage has played a critical role in the increased adoption of VoIP, which has created 911-service headaches for the public-safety sector.
With the petition withdrawal, a Level 3 spokeswoman said the “status quo” remains in effect. Level 3 has contended that VoIP calls connecting to the PSTN should be subject only to reciprocal compensation charges, which are much less than the interstate and intrastate access fees traditional phone carriers pay.
Had Level 3 not withdrawn the petition, the FCC likely would have rejected the petition, according to a Legg Mason report. Outgoing Chairman Powell reportedly had circulated an order that would have granted Level 3 interim relief—the best-case scenario for VoIP providers if the FCC had ruled, said Jessica Zufolo, an analyst for Medley Global Advisors.
“The choice for Level 3 was to withdraw the petition or to get temporary relief, instead of permanent relief,” Zufolo said.
With no clarity provided on the issue, Zufolo said she believes the VoIP access-charge issue could become the subject of litigation. Meanwhile, the FCC has pending rulemakings to determine the regulatory treatment of VoIP calls to the PSTN, but the commission may not want to deal with the dicey topic until it has five commissioners—something that may not happen for several months, as the Senate is gridlocked on administrative appointments.