Information or Telecommunications? How Regulation Affects Hosted PBX and Law Enforcement

Communications is a tightly controlled industry in the U.S. With new hosted PBX technologies, some issues have cropped up that caused the FCC to run into a snag when it comes to properly regulating them. Some of these might seem like simple semantics, but even something as minor as figuring out what to call a hosted PBX service can snowball into something more serious.

Look at it this way- there are separate regulations for information services and telecommunications services. Information services, like the internet, are not as tightly regulated as telecommunications services, like telephone services. So… how should regulators qualify Voice-over-IP systems? They’re essentially a telecommunications service, but one that relies on the internet. Do calls made over the internet qualify as phone calls, or as internet data content? Calling them an “internet content” would make internet-based phone services subject to far fewer regulations than traditional phone services. Needless to say, VoIP service providers are pushing for an information services classification, while traditional phone companies are lobbying for a telecommunications services classification.

This classification problem resulted in a major issue when it came to complying with law enforcement. There’s passed in the 1994 called the Communications Assistance for Law Enforcement Act, which outlines how wiretapping may occur to provide information for law enforcement officials. The law, controversial enough as it is, did not require voip service providers to comply with it initially because their service was not qualified as “telecommunications”. In the years since CALEA was passed it has been greatly expanded to include all VoIP and broadband internet traffic.USA telecommunications providers must install hardware and software, so that it supports the ability of a law enforcement agency (LEA) to perform real-time surveillance of any telephone or Internet traffic.

Another problem regarding a hosted PBX system and law enforcement has to do with emergency services. With a VoIP hosted PBX system, the physical address and other information of a company may not be transmitted. That’s fine if a company wants to keep their information anonymous when they place calls, but what if one of those calls is to 911? 911 dispatchers need to know the physical location where a call is being made from, especially if it is disconnected or the caller is otherwise unable to provide their location. Hosted PBX service providers are required to disclose this limitation to their VoIP customers.

One of the growing pains that any innovative new technology goes through inevitably involves government regulation. Leaving PBX systems unregulated might work out well for new companies that want to start up, but it’s not good for their customers. So, to ensure that they are capable of complying with things like emergency services and law enforcement, things like VoIP and hosted PBX need to be appropriately classified, and acted on accordingly.