IP Interconnection Framework Must Be a Priority, Commissioners Tell PLI

"No one should mistake IP interconnection for voice services with regulation of the Internet,” Clyburn said, because providers are not using the Internet to transmit their voice traffic. Over-the-top services “also need clarity” for voice interconnection, she said. If the FCC prioritizes development of an IP interconnection framework, it could speed the transition to packet-mode networks, she said.

In case of market failure, the commission would have to step in and act, said Clyburn aide Angela Kronenberg. The task force should turn to the “full record,” in which the commission set an “expectation of good faith” in the context of IP interconnection, Kronenberg said. The commission needs a “basic framework” to address what should happen if telcos refuse to interconnect, she said. “It’s better for the commission to address it before there’s a failure.” Michael Steffen, aide to Chairman Julius Genachowski, confirmed the FCC set a “baseline” on this in the context of last year’s Connect America Fund order. Commissioners expect to see good-faith negotiations, he said.

"I agree that if there were to be a market failure, then something would need to be done,” said Maggie McCready, Verizon executive director-public policy. But the commission should “take a step back” and realize that carriers and providers have been exchanging traffic in IP for several years without any government mandates. The Telecom Act was dealing with monopolies, and imposing interconnection obligations upon them to protect against potential abuses, she said. “We're not the monopoly in that room anymore,” she said. “Everyone’s out there trying to do it in good faith. I would not want to create something in case there is a market failure, because we haven’t seen market failures yet,” she said. “It may have the unintended consequence of manipulating the market behavior."

Companies are already exchanging IP traffic, which “helps to calm down the sense that this is wholly new,” said Free Press Policy Director Matt Wood. Maybe one reason big changes in the interconnection space haven’t been seen is because “we do still have this undergirding of [Section] 251” of the Act, which mandates interconnection, he said. In the “not-too-distant” future where there aren’t the protections of Section 251 anymore, “the question is going to have to arise,” he said.

The FCC’s task force and the Technological Advisory Committee will look broadly at transitional issues, and assess the state of the public switched telephone network, said Rosenworcel. The commission’s state counterparts at NARUC also are grappling with these issues, and the role of the states, she said. “We are all wrestling with applying the laws of the present to the networks of the future, and we must make choices that inspire confidence and private investment in our nation’s infrastructure.” If the commission’s actions as it develops an IP transition framework are unclear, they could “undermine investment,” she said.

Rosenworcel encouraged an “honest conversation” about network reliability as the industry moves to fiber and “we are choosing to go without the independent electrical source that traditionally powered copper plant.” She called for the commission to simplify its universal services rules to “inspire investment,” by merging the capital and operating expenditure benchmarks “to simplify the regression analysis and provide carriers with flexibility to meet our new limits.” Rosenworcel wants the benchmarks kept in place for a longer period of time instead of resetting them annually, she said. “This would help ensure a more predictable and sufficient system that provides carriers with more confidence to invest in broadband infrastructure.”