Texas Bill Would Go Against Trend by Mandating Limited VoIP Regulation
The Texas House’s State Affairs Committee is considering legislation that would buck a recent national trend of states pre-empting regulation of VoIP services by requiring partial Public Utility Commission of Texas (PUCT) oversight of those services. A revised version of the bill, HB-2650, would give PUCT oversight of consumer complaints against VoIP providers and require those providers to either cap the length of subscribers’ contracts at 180 days or allow them to opt out of their contract without penalties after the 180-day mark. The bill has encountered opposition from industry, which lobbied for recent bills in other states to pre-empt regulation of VoIP. State Rep. Ed Thompson, HB-2650’s Republican sponsor, told us he believes it’s unlikely the bill will make it out of the State Affairs Committee but he wants to draw attention to the issue and find ways to improve VoIP providers’ self-regulation of consumer issues.
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The revised version of HB-2650 is significantly narrower than the bill's original version introduced last month, Thompson said. The original HB-2650 would have brought VoIP under full PUCT regulation -- a proposal that got significant pushback from telecom officials in the state, Thompson said. He said he narrowed the bill to cover only consumer complaints and particularly the length of VoIP contracts because he believes VoIP subscribers in the state were “hung out to dry” in resolving complaints against providers because of a lack of oversight from PUCT. “Right now the only remedy is through the courts, and most small business owners don’t have the time or resources to fight something like that,” Thompson said.
HB-2650 contrasts substantially with actions in four states -- Kentucky, North Dakota, Pennsylvania and West Virginia -- that reduced or eliminated state regulators’ authority over aspects of wireline and VoIP (see 1503130057). Those statutes have received significant backing from industry stakeholders, including the Voice on the Net (VON) Coalition. VON Coalition President Glenn Richards said his group would “oppose any effort to undermine the existing law in Texas that provides regulatory certainty for providers of VoIP and other IP services. If anything, the market for these services has gotten more competitive, which obviates the need for additional regulatory oversight.”
State industry stakeholders have continued to oppose HB-2650 in its revised form, with Texaltel Executive Director Charles Land being the bill’s most public opponent. The state telecom group opposes the contract limits imposed under the bill because the provision is “a step backwards” by imposing additional regulation at the state level, Land said. The contract limits would also “ultimately disserve consumers” because it would likely result in higher prices for VoIP services, he said. Thompson said he knew when he introduced HB-2650 last month that he was facing a “David vs. Goliath” situation but said he believes the bill will draw attention to what he views as a lack of sufficient protections for VoIP subscribers. “I’m a pro-business individual and I want the government to leave me alone as well, but as a society we need to give protections to consumers against bad actors,” he said.