In a victory for cable television operators who depend on voice over IP (VoIP) telephony for revenue, the FCC said last week that rural telcos must connect calls made by voice-over-Internet protocol customers.
The decision breaks down of one of the last barriers preventing VoIP to fully compete with traditional phone carriers. The commission ordered rural service providers in Nebraska and South Carolina to connect telephone calls made by customers of Time Warner's VoIP service.
State regulators had argued that because the FCC had not classified VoIP providers as telecom services, the local telephone companies did not have to honor their phone calls.
The decision allows VoIP providers such as Time Warner to offer national phone service. Currently, some VoIP companies contract their phone service to a third-party provider. In Time Warner's case, Sprint Nextel is the actual phone provider.