• FCC Fines Madison River Telecom for Blocking VoIP Traffic -- Serious questions remain regarding scope of FCC's VoIP enforcement authority.
  • May 19, 2005 | Author: Ross A. Buntrock
  • Law Firm: Womble Carlyle Sandridge & Rice - Washington Office
  • On March 3, 2005, the FCC levied a $15,000 fine on Madison River Telephone Company, LLC ("Madison River") pursuant to the Commission's authority under Section 210(b) of the Communications Act. Section 201(b) requires that carriers provide telecommunications services at rates, terms, and conditions that are "just and reasonable."

    The $15,000 fine resulted from an investigation regarding allegations by Vonage Holdings Company ("Vonage") that Madison River was blocking ports used for VoIP applications, thereby affecting customers' ability to use VoIP service. The Commission concluded that such blocking was an unjust and unreasonable practice. As part of the fine, Madison River agreed that it would not block ports used for VoIP applications or otherwise prevent customers from using VoIP applications.

    Many in the VoIP industry have lauded the FCC's swift action (the issues was resolved in less than a month), but serious questions remain regarding the FCC's enforcement authority.

    Specifically, many argue that Section 201(b)'s "just and reasonable" requirements apply only to telecommunications service providers in their provision of telecommunications services. Under such a construction, Section 201(b) does not apply to "information services," which are separate and distinct from telecommunications services.

    Over the last several years, the FCC has been working to classify broadband connections (e.g., cable modem and DSL) as "information services," not "telecommunications services." Indeed, the proper classification of cable modem services is pending before the U.S. Supreme Court in Brand X v. FCC (oral argument March 29), where the FCC is arguing that cable modems are information services.

    To the extent broadband connections are "information services," the FCC will have little or no ability to take enforcement action similar to that taken against Madison River. Thus, although the FCC acted swiftly against Madison River, the FCC's on-going ability to do so may be quite limited.