FCC Says Open Door is Shut

By SmallBusinessComputing Staff | Posted September 01, 2000
by Robert Wagman

Not sure what to do with this new-fangled Internet telephony thing? Neither is the government. In a bureaucratic maneuver that seemed to befuddle many in the public and media, the U.S. House of Representatives passed a bill to outlaw any future per minute Internet access charges, or so-called increases to "universal service" charges for Internet access. Meanwhile, the bill specifically left open for future Federal Communication Commission consideration the possibility of allowing local phone companies to charge Internet telephony providers access fees if their Internet calls are connected over local phone lines. But the FCC says that even if it is given the power to do so, the Commission will not allow such connect fees.

Telephone companies believe that they are losing huge sums of money when people communicate by exchanging e-mail and making phone calls through the Web, rather than by making long distance calls or sending faxes over their lines. They would like to compensate for these losses by charging Internet telephony providers for access. In many European and Asian countries, phone companies charge by the minute for access to Internet providers, making it an expensive proposition to surf the Web or send e-mail.

To protect American businesses and consumers, the House passed H.R. 1291, which prohibits timed charges or Internet access charges. But in doing so, it specifically gave the FCC the power to allow phone companies to impose access fees on Internet calls completed over their local lines.

Bill sponsors say they allowed the provision in order to prevent local telecommunications companies from opposing the overall measure. Internet phone calls are a small item in comparison with overall Internet access ­ for now. But obviously companies will not be able to offer free or pennies-a-minute long distance calling if they have to pay a fee for every call completed.

But the FCC says don't worry. If the bill eventually becomes law in its present form ­ and it still has a long way to go ­ the Commission will not allow any such connection fees.

"This Commission has continually held that all access to the Internet should be free of government mandated charges and fees and that policy will continue," a spokesperson says. "The fact that we can do it, absolutely does not mean we have any intention of doing it." U.S. businesses can speak easy, for now.

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