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Tech law on the edge. It’s true, really.
[June 17, 2005]

Tech law on the edge. It’s true, really.

BY TED GLANZER, Assistant Editor, TMCnet

Sitting back for a moment and using my keen legal mind today (I’m a lawyer, but don’t hold that against me; I’m a pretty decent guy), I realized that we aren’t just experiencing a technology revolution. We’re also facing a legal and regulatory revolution – to the extent possible.

Indeed, as many have noted, breakthroughs in areas such as voice over Internet protocol (VoIP) are being regulated by laws that are over 100 years old.
In response, the judiciary, legislature and bureaucracy have taken strides to remedy such matters.

Consider the following are just a few legal and regulatory issues under consideration on the federal level:

The Brand X case: On the judicial side, the U.S. Supreme Court is supposed to issue a decision any day now regarding the infamous Brand X case. The issue before the court is whether the FCC should regulate cable broadband service as a telecommunication service under the Telecommunications Act of 1996. Some so-called news analysts have dismissed the overall impact that the decision will have. I disagree. The Supreme Court never handles insignificant matters. Let me restate that for maximum effect. The Supreme Court never handles insignificant matters.

That Wild & Wacky FCC: Of course the Federal Communications Commission will be a major player in the realm of burgeoning technology issues. The commission has experienced some major turnover, what with Chairman Michael Powell resigning and Kevin Martin ascending to the top spot. Nevertheless, in May the FCC issued a ruling that requires VoIP providers to include in their services enhanced 911 capabilities. In addition, the commission on Tuesday announced that it launched an investigation into the management and administration of the Universal Service Fund, a federal law that is aimed at providing telecommunications and Internet service to rural and low-income areas as well as schools and libraries. The investigation comes on the heels of allegations of mismanagement, waste and even outright fraud regarding how the fund has been handled. The fund has about $6.5 billion at its disposal, so this is no small undertaking by the FCC.

Re-write of the Telecommunications Act of 1996: recently reported that U.S. Sen. John Ensign (R-Nev.) is handling the initial re-write of the watershed law. Among the major issues that are expected to be addressed is whether telecoms, to ease their struggles in launching their IPTV solutions, will be able to obtain national or statewide franchising agreements rather than having to obtain local licenses in the same vein that cable companies must negotiate. In addition to the protestations of cable companies concerning such legislation, groups representing cities and towns are vigorously lobbying to have the requirement of local franchise agreements remain in tact.

Tax implications: A major piece of the regulation puzzle in technology is how the Internet and VoIP will be taxed, if they are subject to taxes at all. Several Republican senators, such as New Hampshire’s John Sununu, have expressed their desire to keep the Internet and VoIP tax free at the federal and state levels.

Merger mania: There is uneasiness in some sects regarding the two telecom mega-mergers: AT&T with SBC and MCI with Verizon. Review of the mergers is pending.

In light of the forgoing, will continue to monitor and report on breaking developments in these areas.

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