Verizon Tactics Show the Challenge of Moving to IP Telephone Networks

The telecommunications industry is in the midst of a big transition as it moves from the legacy public switched telephone network (PSTN) to newer session-initiation protocol (SIP) and IP-based communication.

One of the big challenges still being addressed is interconnection agreements among providers; most still are agreed upon and engineered on a case-by-case basis, and this both leads to a duplication of effort and the potential for an unfair playing field if operators don’t all play fair with each other.

Recently, Vonage and Verizon have begun to offer IP interconnection agreements that promise to deliver a single, nationwide interconnection with service providers that want to exchange VoIP traffic. The approach taken by Verizon with its agreements, however, has many concerned that the company is creating the agreements as a way to stave off fair-play regulations currently being discussed by states and the Federal Communications Commission.

The trouble is the nondisclosure agreements that Verizon asks service providers to sign. The NDAs keep service providers from seeking regulatory help if Verizon lays out unreasonable interconnection terms.

“They don't want their IP interconnection arrangements to be open and don't want them to be subject to the act,” warned Angie Kronenberg, chief advocate and general counsel for competitive industry association, COMPTEL, in a recent industry article. She added: “They want carriers to sign very tight NDA, so tight that a carrier would not be able to tell the FCC what's going on and I think that should raise eyebrows.”

AT&T has already gotten in trouble for such practices in Michigan; the State ruled that the company was required to provide Sprint with IP interconnection for the transmission of telephone calls that AT&T provides to itself, affiliates or third parties after a legal dispute.

Incumbents in the industry say that regulations that would force interconnection agreement rules are archaic and that the industry will handle the problem itself without innovation-stifling regulation. But, it is pretty clear that when vested interests are pushed aside in the argument, there’s a definite case for at least light regulation to ensure that VoIP service providers are not unfairly kept from offering their customers an alternative to the incumbents.

Just as there needed to be regulation that telephone providers would share the PSTN network with each other, so too must there be some form of safety that VoIP will likewise have a level playing field where all can participate.

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