BOSTON -- Prepare for more VoIP regulation as the FCC more often treats VoIP as it does traditional phone service, panelists said Tuesday at the VON conference. The VoIP industry must pay more heed to rules emerging at the federal, state and international levels, they said. “You need good legal counsel to navigate these kinds of things,” said VON Executive Director Jim Kohlenberger.

Telecommunications infrastructure in rural America could deteriorate unless the Universal Service Fund is overhauled to reduce growing payments to competitive eligible telecom carriers, said McLean & Brown. The consultants wrote and paid for the study, publicized by the Coalition to Keep America Connected, a rural telecom group backing a cap on payments to CETCs, which mainly are rural wireless providers. “Payments to CETCs have skyrocketed, growing by more than 1,000 percent in the past six years,” said the coalition. The report concluded that USF growth as a result of increases in the number of CETCs renders “the existing system unsustainable.”

The FCC late Friday approved purchase and privatization of Alltel by TPG Capital and Goldman Sachs Capital with a condition that concerned some commissioners. The order contains language capping Universal Service Fund payments to Alltel at 2007 levels, unless Alltel files cost data showing its per-line costs are less than the capped funding level or immediate compliance with the E-911 public safety answering point (PSAP) location accuracy standard.

Seeking Universal Service Fund reform they can live with, telecom companies have been meeting in small groups for months trying to agree on proposals for the Federal-State Joint Board on Universal Service. As the joint board’s self- imposed Nov. 1 deadline nears, meeting participants have become more closed-mouthed about progress.

An order drafted by FCC Chairman Kevin Martin would approve Alltel’s pending purchase and privatization by TPG Capital and Goldman Sachs Capital, but would cap Universal Service Fund payments to Alltel at 2007 levels. In what agency sources see as a surprising twist, the cap would come off only if Alltel can show immediate compliance with E-911 accuracy standards. Alltel called commissioner offices asking for a quick vote on the merger, though the order as circulated by Martin doesn’t invoke an abbreviated timeline. The Alltel order is expected to get approval. Officials from TPG Capital and Goldman Sachs had been pressing harder for a vote in recent weeks (CD Oct 22 p10). Martin also circulated an order that would approve AT&T’s acquisition of Dobson, also with a USF cap.

SAN FRANCISCO -- The joint board may not be able to agree on long-anticipated recommendations to revamp universal service, a board leader said. “We might not be able to get anything out,” Ray Baum, the state chairman of Joint Board on Universal Service, said late Wednesday at the CTIA conference. “I'm cautiously optimistic,” Baum added. In any case, a Nov. 1 board target date for sending its recommendations to the FCC seems likely to slip. “We're going to make a vigorous effort” to send suggestions “by the end of next week,” he said.

The FCC’s proposal to cap the high-cost Universal Service Fund program for rural areas could “undermine efforts to make reliable wireless service available to all Americans,” said presidential candidate Sen. Christopher Dodd, D-Conn. “I urge you to ensure that any action taken does not negatively impact the safety and security of our nation’s rural communities,” Dodd said in an Oct. 18 letter to FCC Chairman Kevin Martin.

Small phone companies lose money because VoIP providers pay no access charges, the CEO of Laurel Highland Telephone Company told an FCC official. In an ex parte letter on the Monday meeting, CEO James Kail said his rural Pennsylvania company is seeing “dramatic increases” in uncompensated VoIP-originated traffic. The company, in fact, suspects that some VoIP providers “not only are avoiding payment of access charges” but also “may be enticing other carriers to migrate their traffic” to companies such as Laurel Highlands, Kail told Ian Dillner, FCC Chairman Kevin Martin’s aide. In September, one company, Choice One, terminated 32% more traffic on Laurel Highland’s network, compared with August data, Kail said in the filing. “Continued indecision about applying access charges to interconnected VoIP carriers by the Commission will lead to serious erosion” of Laurel Highlands’ “access revenue base,” he said. The FCC has placed various regulatory requirements on VoIP providers, including CALEA compliance, E-911 availability, Universal Service Fund contributions, telecom relay service, regulatory fee payments and protection of customer proprietary network information, Kail said. “The Commission should now take the logical next step, clarifying that access charges apply under current rules to interconnected, interexchange voice calls irrespective of the technology used to provide the service.” Two representatives of the National Exchange Carrier Association accompanied Kail to the meeting with Dillner.

UNIVERSAL CITY, Calif. - Flat-panel TV pricing appears headed for a calmer holiday season than last year, retailers and manufacturers said in separate panel discussions Thursday at the DisplaySearch HDTV conference. Inventory, save for some shortages in 32W and 37W LCD TVs, is ample, they said. Few said they expect a rerun of last year’s volatile price cutting, triggered in large part by Panasonic’s decision to lift minimum advertised prices for Black Friday.

UNIVERSAL CITY, Calif. -- Pioneer’s Project Kuro, designed to give the company’s plasma TVs deeper blacks and better color saturation, will benefit from Sharp’s recent $357 million investment in the maker (CED Sept 10 p1), Paul Meyhoefer, Pioneer vice president of display marketing and product planning, said at the DisplaySearch HDTV conference Thursday.