Vonage Starts Charging 'Regulatory Recovery Fee'

slavitos writes "Vonage sent an email announcing that starting with 'your next billing cycle, Vonage will begin to charge a Regulatory Recovery Fee of $1.50 per phone number. This is a fee that Vonage charges its customers to recover required costs of Federal and State Universal Service Funds as well as other related fees and surcharges. State and Federal agencies collect these fees from communications providers to fund public projects such as rural and library communications programs.' That could mean that Vonage is losing at least some ground in its battle against government VOIP regulations."

Gotta love that "free market"

[Ricin]

Well no matter what the money tends to go into the same pockets anyway. Would that be a force of nature or something? :)

Psychology

[Wesley Felter]

Which would you prefer: "We're raising our prices, suckers!" or "We're not greedy, but we now have to pay the universal service fee, and we're passing that on you you"?

Re:I don't understand

[C10H14N2]

Maybe because voters have given governments (like Orange County, California) the right to dream up fees on unrelated activities (like speeding) to pay for their own mismanagement and bankruptcies (speeding causes bankruptcy?) or given them the authority to demand that cell-phone companies charge "local infrastructure" fees on their users just because they use a certain area-code and prefix. As an example, Sprint levies a local use fee of about $15 on me payable to the City of Long Beach, California while I live in Washington, DC not using a single atom of Long Beach's infrastructure. This is all the result of voting, be it yours or your rep's, not corporate greed. It should come as no surprise then that companies then charge you for fees resulting from our collective altruism and/or stupidity.

I would actually congratulate Vonage on itemizing it so you can then march into your representative's office and scream at them. If only every silly excise tax were so effectively communicated to consumers, maybe people would be more active in this "democracy."

Re:Why should the government control everything?

[westlake]

I thought the idea was to improve things using technology

and lifeline service/universal access, rural telephone services and library connectivity to the 'net couldn't possibly be ways to "improve things using technology?"

not tax the improvements so much that they're not improvements anymore

$1.50/mo scarcely seems so crushing a burden

Re:Why should the government control everything?

[headbulb]

well one thought comes to mind.
Some technology does need to be tazed.

Lets say that your in a city where it is cheap to put in a line. That line gets taxed. That money then goes towards subsidizing more expensive long haul lines or for people out on the farms.. So you can now call some far away family/friend over the line that was subsidized. kinda how roads are built using tax's on gas. The money I imagine would also go towards managing the phone companies.. Since vonage does connect to the ptsn this is a fair tax. It connects to the public phone network. So its all game. So voip isn't the thing gettting taxed its the services that is beign provided. (if it wasn't connected to the ptsn then it wouldn't be the same service)

just a bunch of thoughts

Vonage _IS_ a phone company and should pay

[linuxtelephony]

I know it is an unpopular view to maintain, but VonAge IS a phone company, they market themselves as a phone company, they provide the same services as a phone company, so they should pay the same fees and treated like other phone companies.

Just because they are use a different pipe into the home than a traditional telco should not exclude them from complying with the same rules and regulations a telco has to abide by.

If you don't like the rules VonAge has to live with, then attack the regulations themselves that apply to all phone companies.

VonAge is decidedly different than "voice" features in IM programs, or even outbound only low priced LD services. VonAge provides full featured, two way phone service. You get a phone number, people can call you if they are not on the Internet, and you can call people not on the Internet.

They've gotten a free ride long enough.

Other services are quite different. IM programs communicate between computers, or in some cases the computer user contacts a phone # somewhere. Other servicse provide out-bound only network to phone features. And so on. Each of these provides _some_ functionality of phone service, but not the full package. Thus, they should not get hit with telco regs or fees.

It could be argued that out-bound network to phone long distance services could be considered a long distance carrier and should comply with those regulations -- but that would all depend on the details of the service provided. A blanket generalized statement would cause more harm than good.

One thing further, if these services are considered telcos, then they should also be given common carrier status. If not, then they should not be considered a common carrier. If they are not a common carrier, then it opens them up to all kinds of legal nightmares, responsibility for content/control, possible liability, and more. You'd think they'd want to be a common carrier. They should not be allowed to claim "common carrier" and be excluded from phone company regulations.

Re:I don't understand

[blitziod]

does Vonage sound like good deal to anyone here? I mean i can get unlimted LD from MCIor from my local bell telephone company on a land line for roughly the same price. If i get the physical line installed i get the extra BW from that line. If I go with Vonage i am paying my net provider(cable. dsl, T1, etc) for the bandwidth.

In other words...

[inode_buddha]

Taxes. Hidden, but still basically taxes. All that's really happening here is that Vonage is passing the bill along to consumers.

That's why my landline phone bill averages out to about $70/mo in the Buffalo, NY region, even though the actual service is about $40. This is without making *any* long-distance calls, using Verizon (local incumbent monopoly, FWIW).

If you think that's bad, you should see what the electric looks like here, esp. after the blackout.

Re:Economics For Useless Twits

[whois]

Why is it you think telcos have insane profit margins? Aren't you paying 2.5c a minute, or whatever the crazy rate is that everyones paying now?

If not, why aren't you dialing 10-10-whatever.

Telcos are underpaid for "expansion costs" and overpaid for "maintenance cost". Maintenance costs next to nothing (things work right half the time, and when it doesn't at least people know what to repair) but expansion is an incredible expense with no garuntee of return on investment.

So telcos aren't expanding now, they're just trying to hold on to every customer they can.

Pay attention, because this is why you don't have fiber to your pee-pee yet. It's coming, but like everything else you'll have to pay "INSANE" profit margins for it.

As to CEO's making too much money. We live in a capitalist society. If you can find someone really smart who's fully qualified to run your company and only wants $35k per year, then go ahead and hire them. But you won't. CEO's make the money they do because people offer it to them. Complaining doesn't make it wrong, or right. It's just the way it is.

Re:Vonage _IS_ a phone company and should pay

[wfberg]

Companies' PBX boxes do the same. They're not regulated as telecommunications companies.

The deal with regulation is that ILEC's have a monopoly, because it's easier to dig one cable into every home (I say dig, I understand you USians still have overhead phone cables as well..) than to have 100 competing companies rolling out competing networks. In return for this monopoly, the ILEC must provide things like universal access, etc.

VOIP carriers are more like LD carriers, except for the fact that at least one of the endpoints is IP in stead of POTS or ISDN. No big deal, really.

The ILECs seem to be in favor of having VOIP carriers like vonage either completely destroyed, or as heavily regulated as cell phone providers - which makes absolutely no sense, even if cell phone providers weren't as overregulated as they are today (and by that I mean that there are not enough opportunities for meaningful competition, rather than 'ownership restrictions should go').

It would probably be unfair to other LD operators to have VOIP operators be totally unregulated whilst LD operators are - maybe a little more regulation for VOIP and a litte less for LD..

But what should be avoided at all cost is that it would be made illegal or impossible for end-users to use VOIP to talk to each other (and yes, the telco's and DSL people would LOVE to prohibit you from using voicechatting and/or vonage! There are bills introduced on all regulatory levels to this effect all the time..) because that would make it harder for ILEC/LD/VOIP telcos to make a living. The regulation should encourage competition, lower barriers of entry, level the playing field, and protect consumers, NOT stifle adoption of this (or any other) technology.

A buck fifty doesn't sound like much, but.. what do they (vonage/FCC) do in return for that money?