Out-Law News 2 min. read

Ofcom unveils tighter VoIP regulation

Ofcom has tightened its regulatory grip on Voice over Internet Protocol (VOIP) telephone services. The telecoms regulator insists that sellers of VoIP are more up front about the nature and limitations of the service.

Advert: Infosecurity Europe, 24-26 April 2007, Grand Hall, Olympia, London, UKCustomers will have to sign a document saying that they understand that access to emergency services numbers will not be available during power cuts on VoIP services, and labels to that effect must be placed on equipment to be sold, according to new rules from Ofcom.

Providers must also now comply with a consumer protection code of practice according to the rules, which are the result of a three-year consultation process.

VoIP services are not available during power cuts because they depend on the operation of an internet-connected machine more complex than a normal telephone. VoIP telephony is the sending of phone signals in information packets over data networks rather than over dedicated voice lines.

The regulations were greeted with some hesitation by the industry body representing UK VoIP providers, the Internet Telephony Service Providers' Association (ITSPA). "Although they are broadly acceptable, ITSPA is wary that the detail of the new rules may have unfortunate implications for UK businesses and consumers," said the body in a statement.

"Members have expressed a number of fundamental concerns with the statement," it said. "VoIP will be subject to a stricter regulatory framework than any other technology within the UK telecommunications industry. These new regulations will be particularly hard to enforce against providers who are based overseas, but market their services within the UK. This will be a significant threat to the UK consumer, who may not be aware of the disparity."

Advert: Free OUT-LAW breakfast seminars, Protecting your name on the net; and Overseas transfers of personal dataThe Association also said that the regulation would cost its members money, and that this could put it at a competitive disadvantage compared with competitors based overseas who are not subject to Ofcom's regulation.

Ofcom said in its statement announcing the regulation that the VoIP sector was an important one, and was bound to become even more significant.

"VoIP services continue to have a greater and greater impact on the UK communications sector. Over the last year, a range of new services has been launched and uptake has increased significantly," it said. "In time, VoIP services have the potential to offer significant new benefits to consumers, including more competition and choice, lower prices and new services such as second lines and nomadic services."

VoIP providers are not required to ensure that customers can always have access to emergency services such as police, fire or ambulance services in the same way that mobile and traditional telephone companies are.

Ofcom said that as part of the consultation process a number of respondents expressed concern that leniency on VoIP firms on this issue was leaving customers at risk of not being able to contact emergency services. Ofcom agreed, and said it will investigate a change to those rules.

"We have completed initial research that suggests that there is potential for [customer] detriment," Ofcom said. "Therefore, we will consult on whether, and if so how, certain VOIIP services should be required to offer emergency services access. In assessing the need for any new requirement, we will continue to carefully consider the impact of such regulation on market entry, innovation and competition. This consultation will take place this summer."

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