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Old and new square up in VoIP debate

Light touch regulation vs level playing field

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The old and new of the telecoms industry are preparing to make their case as Ofcom takes another look at the rules governing internet telephony in the UK.

Yesterday, the regulator published a consultation document in which it proposed a number of suggestions to help protect consumers. While the regulator acknowledges that VoIP has the potential to benefit punters by reducing costs, increasing competition and enabling new and innovative services, it wants to ensure that this is done fairly.

And while Ofcom does not want to impose regulations that might stifle new services, it believes that competition between traditional and internet-based voice services should occur on a level playing field.

Which is why it is consulting the industry on a range of issues such as the availability and reliability of 999 calls on VoIP networks, number portability when switching providers, and what information must be offered to punters so that they understand the scope of broadband telephony services.

And if such regulations are introduced, Ofcom then needs to set up some monitoring and reporting process to ensure that VoIP operators are complying with the regulations.

ITSPA - the Internet Telephony Services Providers Association which represents VoIP operators - says it is "cautiously optimistic about Ofcom's VoIP approach" but has warned that "excessive regulation could stifle the sector and ultimately limit consumers' power of choice". The VoIP trade group (members include Vonage, GossipTel and Wanadoo) reckons that the development of internet telephony has flourished in the UK, in part, thanks to the regulatory "light touch" adopted by the regulator since September 2004.

But as ITSPA chair Eli Katz says, the industry is "concerned that proposals to regulate all consumer information requirements could reverse this trend and shrink the range of innovative services currently on offer to consumers".

"The VoIP sector would seem to be an ideal opportunity for Ofcom to deliver on one of its key principles of 'least intrusive regulatory mechanisms', especially as the ITSPA Code of Practice mandates many of these same issues on a self-regulatory basis," said Katz

But ITSPA is facing opposition from the UK Competitive Telecommunications Association (UKCTA), which supports the development of new voice services but only if they face the same regulatory burdens as traditional telcos. UKCTA (members include C&W, Colt and Thus) is also chuffed that Ofcom has adopted an approach of "technological neutrality" to the consultation - in other words, that regulation should be based upon the services provided to end users, and not on the technology used to deliver those services.

"There needs to be a clear regulatory framework governing VOIP services - this is essential for effective competition in the UK telecoms marketplace, in turn ensuring that consumers have choice," said UKCTA in a statement. ®

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