Client Alert

--Targets Enhanced Service Providers, Cable Operators, Internet Calling Services, And Others For Carrier Regulation-- 

On January, 11, 2008, Embarq filed a forbearance petition with the FCC to eliminate the “Enhanced Service Provider” exemption to interstate access charges. According to Embarq, a grant of its petition would make Enhanced Service Providers (“ESPs”) telecommunications carriers, and thus subject to the full panoply of carrier regulation, including interstate access charges. ESPs would no longer be considered “customers” of telecommunications carriers, and instead would become carriers themselves.

Specifically, Embarq seeks FCC forbearance from:

• Enforcement of the ESP exemption;
• Application of the definition of “end-user” to IP-originated VoIP traffic under section 69.5 of the FCC’s rules; and
• Regulating “non-local” voice traffic as “telecommunications” as “reciprocal compensation” traffic under section 251(b)(5)

Embarq makes clear that it is targeting specific types of companies for new regulation, Foremost, Embarq seeks to create additional regulatory obligations for interconnected VoIP providers, such as cable operators and Vonage. In addition, regulation would extend to purely Internet-based calling services, like Skype. The petition would appear to treat all ESPs, including conference calling companies, voicemail providers, and others, as telecommunications carriers, subject to FCC regulation and reporting requirements (in addition to access charges).

By statute, the FCC must rule on this petition within 15 months of the filing date. The FCC has yet to put the petition out for comment, but will likely do so in the next several weeks.

If you have any questions or need a copy of Embarq’s petition, please contact Jennifer Kashatus (email).