TELECOM Digest OnLine - Sorted: FCC May Block Vonage From Accepting New Customers

FCC May Block Vonage From Accepting New Customers

Jennifer C. Kerr (
Tue, 29 Nov 2005 22:51:30 -0600

By JENNIFER C. KERR, Associated Press Writer

Vonage Holdings Corp., the nation's largest provider of Internet phone
service, could be barred from signing up new customers in many markets
because it failed to meet the deadline to provide reliable emergency
911 service to all subscribers.

The Federal Communications Commission gave Vonage and other companies
that sell Internet-based phone service 120 days to comply with its
order requiring enhanced 911, or E911, in all their service areas.

The deadline to show the government where E911 is available was
Monday. House and Senate lawmakers had urged FCC Chairman Kevin Martin
to give companies more time and more tools to speed deployment, but no
extension was granted.

In its compliance report to the FCC, Vonage said only 26 percent of
its customer base had full E911 services. The company _ which has more
than 1 million subscribers _ said it was capable of transmitting a
call back number and location for 100 percent of its subscribers, but
that it still was waiting for cooperation from competitors that
control the 911 network.

AT&T declined to comment on its compliance levels before filing its
report with the FCC. Calls to the company on Tuesday were not
immediately returned. AT&T offers Voice over Internet Protocol, or
VoIP, to about 57,000 customers through its CallVantage service.

SunRocket, which has more than 50,000 subscribers nationwide, said it
had equipped 96 percent of its customers with full 911 services.

The VON Coalition, an industry group, had estimated that overall about
two-thirds of Internet phone users would have enhanced 911 by the

Citing public safety concerns, the FCC in May ordered companies
selling Voice over Internet Protocol, or VoIP, to ensure that callers
can reach an emergency dispatcher when they dial 911. The dispatchers
also must be able to tell where callers are located and the numbers
from which they are calling.

VoIP providers were told that if they failed to meet the deadline they
could no longer market their service or accept new customers in areas
that didn't have enhanced 911. They will not have to disconnect
current customers who don't have full 911 service, as some providers
had feared.

FCC spokesman David Fiske declined to discuss possible enforcement
actions against offending companies. 'At this stage,' he said, 'the
agency is focused on the compliance filings by VoIP providers.'

David Kaut, a telecom analyst at Legg Mason, said VoIP companies will
take a hit if the FCC follows through on its threat.

'If you can't add customers in, say, a third of your territories,
that's a significant part of the market where you are all of a sudden
capped,' said Kaut. 'These are supposed to be growth companies.'

Voice over Internet Protocol shifts calls from wires and switches,
using computers and broadband connections to convert sounds into data
and transmit them via the Internet. In many cases, subscribers use
conventional phones hooked up to high-speed Internet lines. But the
service can be mobile, making it difficult to ensure that the call
goes to the correct local emergency center.

There are about 3.6 million VoIP users in the United States. Of those,
about half get their service from cable TV companies that already
provide enhanced 911 capabilities. Other providers offer a 911 service
that directs emergency calls to a general administrative number, but
those lines haven't always been staffed around the clock.

The order applies to companies selling VoIP service that uses the
public phone network to place and terminate calls.

On the Net:
Federal Communications Commission:
VON Coalition:

Copyright 2005, The Associated Press.

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