Clearing The Path For New Communications Technologies: VoIP And The NET 911 Improvement Act

Monday, September 1, 2008 - 01:00

Voice over Internet Protocol (VoIP)-based applications and services represent one of the most disruptive forces to impact the communications marketplace over the past decade. VoIP has changed the way we think about distances, locations, telephones, and the distinctions between voice and data. As with most technological breakthroughs, VoIP originally was the province of early adopters who had the technological savvy to configure VoIP applications on their computers and the patience to tolerate the poor quality that plagued early applications. Mainstream consumers embraced the new technology only after providers like Vonage introduced commercial mass market VoIP applications that served as nearly direct substitutes for traditional voice telephony. Although voice substitution represents perhaps the least innovative benefit that VoIP-based applications and services can offer, the familiarity of traditional voice telephony services and improved quality of the commercial applications made mainstream users comfortable enough to try the new technology.

Providers of VoIP services were increasingly capturing greater market share and introducing innovative new features when disaster struck - some callers attempted to contact emergency services by dialing 911 using VoIP services that did not support 911 emergency services. In the most infamous case, an infant died after her mother attempted to reach emergency services by dialing 911 several times using Vonage's VoIP service, which routed 911 calls to a prerecorded message instructing callers to hang up and dial 911. In another instance, a girl in Houston was unable to connect to a 911 dispatcher after her parents were shot during a robbery. The tragedies that resulted from failed attempts to reach emergency services by dialing 911 on VoIP services received national media attention.

In response to these tragedies, the Federal Communications Commission (Commission) adopted rules imposing 911 requirements on providers of "interconnected VoIP services," which are a specific subset of VoIP services that are substitutes for traditional voice telephony. The "VoIP 911 rules" require all providers of interconnected VoIP services to offer 911 emergency services as a condition to providing service and customers cannot "opt out" of receiving compliant 911 emergency services. The "one size fits all" rules apply equally to all interconnected VoIP services without distinguishing between (i) retail and wholesale services, (ii) fixed and nomadic (mobile) services, or (iii) residential and enterprise services. Consequently, providers of interconnected VoIP services are prohibited from serving any location where they are unable to offer a compliant 911 service, even if the customer does not want or need 911 service from the VoIP service provider.

Certain aspects of the VoIP 911 rules were particularly burdensome. For example, the VoIP 911 rules require providers of interconnected VoIP services to route every 911 call via the legacy dedicated wireline E911 (Enhanced 911) Network, which means that service providers relying on the most efficient and modern technology must tie their services to the legacy wireline telephone network. Despite this requirement, the Commission did not adopt any rules granting providers of interconnected VoIP services access to the legacy wireline telephone network to provide access to providers of interconnected VoIP services. Worse yet, unlike providers of traditional wireline and wireless telecommunications services, providers of interconnected VoIP services did not enjoy statutory immunity from 911 lawsuits. The Commission noted that providers of interconnected VoIP services could instead seek to protect themselves from liability for negligence through their customer contracts and through their agreements with Public Service Answering Points (PSAPs).

The impact of the burdensome VoIP 911 rules on residential and nomadic interconnected VoIP services has been particularly dramatic. While "subscriber addition rates" for fixed and enterprise VoIP services have continued to grow each quarter since 2003, subscriber addition rates for residential and nomadic VoIP services have remained constant or fallen since the Commission adopted the VoIP 911 rules in June 2005. Indeed, until June 2005, the growth rates for nomadic VoIP services had mirrored those of fixed services. The market statistics reflect the fact that many providers of interconnected VoIP services stopped providing nomadic services altogether when the Commission adopted its VoIP 911 rules, choosing instead to focus on providing fixed services to enterprise customers. The burdens and risks associated with providing nomadic VoIP services, or even fixed VoIP services to the residential market, simply proved to be too high for many providers of interconnected VoIP services.

Soon after the Commission adopted the VoIP 911 rules, Congress began considering bills to extend the same liability protection that providers of traditional wireline and wireless telecommunications services enjoy to providers of interconnected VoIP services. Over three years later, on July 23, 2008, President Bush signed into law the New and Emerging Technologies 911 Improvement Act of 2008 (H.R. 3403) or the "NET 911 Improvement Act." Like the Commission's VoIP 911 rules, the legislation mandates that providers of interconnected VoIP services, which the Act calls "IP-voice enabled service providers," offer 911 and E911 to subscribers. However, the NET 911 Improvement Act includes important provisions designed to increase the emergency calling capabilities not only for interconnected VoIP services but also for any other emerging technology. These provisions seek to ensure that the regulatory 911 obligation is imposed in a technologically neutral manner so that anyone providing emergency calling services, regardless of the technology used to provide those services, is treated in the same manner as providers of traditional telecommunications services.

The most important change effected by the Act is the extension of liability protection to providers of interconnected VoIP services, public safety and others involved in handling 911 calls. Providers of interconnected VoIP services now have the same liability protections when handling 911 calls as those available to wireless and wireline telecommunications service providers. Specifically, providers of interconnected VoIP services are now indemnified for acts or omissions involving emergency calls to medical or law enforcement service providers.

Until the NET 911 Improvement Act, statutory immunity for handling 911 calls was granted to providers of wireline telecommunications services on a state-by-state basis. Pursuant to federal law, providers of wireless telecommunications services have long enjoyed the same degree of liability protection for handling 911 calls as wireline carriers. The NET 911 Improvement Act extends this liability protection to all parties involved in handling 911 calls, including providers of interconnected VoIP services. Importantly, the Act includes immunity for future services to the extent that they provide emergency calling capabilities irrespective of the technology they employ. By granting liability protection on a technologically neutral basis to all parties involved in handling 911 calls, Congress removed one of the principle obstacles to the improvement of our nation's emergency services network and the deployment of new technologies for providing voice telephony.

The NET 911 Improvement Act also ensures that providers of interconnected VoIP services have the right to access any 911 and E911 capabilities necessary to comply with their obligation to provide 911 and E911. Specifically, the legislation gives providers of interconnected VoIP services access to the same tools for implementing 911 and E911 as mobile service providers, and on the same rates, terms and conditions. As such, companies that provide equipment or services for handling 911 calls will not be able to deny access to this technology or profiteer from the sale of necessary components.

By October 21, 2008, the Commission must promulgate regulations to govern access to capabilities to provide 911 and E911 services. The Commission's new regulations must:


Ensure that providers of interconnected VoIP services have access to necessary technology and equipment under the same terms and conditions provided to commercial mobile service companies;


Account for any VoIP-specific technical, network security, or privacy requirements that are specific to interconnected VoIP services; and


Require providers of interconnected VoIP services to register with the Commission and provide a point of contact for public safety and government officials.

By requiring the Commission to adopt rules governing mandatory access by providers of interconnected VoIP services to necessary 911 capabilities, the Act removes another key obstacle to the deployment of nomadic and residential interconnected VoIP services with compliant 911 emergency services. Ironically, the full scope of the potential impact of these rules is unclear. Specifically, many providers of interconnected VoIP services narrowed their offerings or left the market altogether shortly after the VoIP 911 rules became effective in 2005. The vast majority of the remaining providers either rely on third-party vendors ( e.g ., Intrado) to gain access to necessary 911 capabilities or they are affiliated with incumbent local exchange carriers that own the capabilities. Time will tell whether the new rules will entice new providers to enter the market or existing providers to begin relying less on third-party vendors.

The Act also requires the creation of a plan for a national IP-enabled emergency network that would improve location information for nomadic devices and multi-room structures, such as apartments and office buildings, and allow 911 call centers to receive emergency messages via all methods of IP and mobile communication - including e-mail and text messages. The Commission must report to Congress within 270 days ( i.e ., April 25, 2009).

Importantly, the NET 911 Improvement Act does not mandate a specific framework for regulating technology nor does it try to fit a new technology into legacy-minded regulations. Rather, the NET 911 Improvement Act seeks to develop policy goals for improving emergency calling capabilities for all technologies, but in a manner that allows the industry and regulators to work together to develop solutions that are technically feasible. In so doing, the Act seeks to advance the development of next generation IP-based 911 systems so that we can migrate away from the current network technology that was developed in the 1960s. This approach stands in stark contrast to the Commission's VoIP 911 rules, which required providers of interconnected VoIP services to adapt their modern and efficient technologies to legacy technologies, which inhibited the development not only of advanced 911 emergency services but also of all interconnected VoIP services.

The NET 911 Improvement Act signals a change in direction for the regulation of 911 and E911 emergency services. By addressing some of the key obstacles that providers of interconnected VoIP services face in a technologically and competitively neutral manner, the Act may facilitate entry to, and expansion of, the market for interconnected VoIP services and expedite the deployment of the next generation of emergency 911 services. The achievement of the stated goals of the Act now lies largely in the hands of the Commission, which must implement important provisions of the Act, and state regulatory authorities, to which the Commission may delegate authority to enforce the rules it adopts to implement the Act. In any event, the new developments should create new opportunities for both providers and users of interconnected VoIP services.

Todd D. Daubert is a Partner in the telecommunications practice group in the Washington, D.C. office of Kelley Drye & Warren LLP. He focuses on representing companies in regulatory, appellate, litigation and transactional matters and his practice involves a broad range of technology and communications law issues. Devin L. Crock, an Associate in the telecommunications practice group, assisted in the preparation of this article.

Please email the author at tdaubert@kelleydrye.com with questions about this article.