With E911 deadline past, what's next for VoIP firms?

By Marguerite Reardon
Staff Writer, CNET News.com

Published: December 1, 2005, 4:00 AM PST

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The deadline for Net phone providers to have their customers outfitted with enhanced 911 capabilities has come and gone. So what now?

At this point no one really knows. Officials at the Federal Communications Commission say they're still reviewing documents that were filed by voice over Internet Protocol, or VoIP, providers before a 12:01 a.m. Tuesday deadline. That means it's impossible to say for certain how many VoIP companies are in compliance with the mandate.

So far, the FCC hasn't taken action against specific companies. For the time being, the Internet telephony industry is in a kind of limbo. Companies such as Vonage and 8x8 say they plan to continue marketing to prospective customers and signing them up for their service, but in doing so the companies risk racking up heavy fines.

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What's new:
The deadline is past for Net phone service providers to outfit their customers with enhanced 911 capabilities. Many providers are not yet in full compliance with the FCC's E911 requirements, and industry executives aren't sure how the FCC will handle the situation.

Bottom line:
While the FCC continues to review documents pertaining to E911 service, Net phone service providers continue to market to potential customers and work on various solutions to technical problems posed by E911 requirements.

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"I don't know what the next step is," said Bryan Martin, president and CEO of 8x8. "This is the final filing since the FCC issued its mandate 120 days ago. We had a collective sigh of relief the other day after we filed, but now we don't know what comes next or how the FCC will react to our filing."

In May the FCC issued a mandate requiring all voice over IP providers to comply, within 120 days, with enhanced 911 services that automatically provide a caller's location and telephone number.

The FCC told VoIP operators that if they didn't comply with the rule by the deadline they would be forced to stop offering service to customers. But earlier this month, amid complaints from the industry, the FCC revised its position. Instead of being shut down, VoIP providers that don't comply will be unable to market their services to new customers in areas where E911 isn't yet available.

It's unclear what the FCC will do next. Some experts believe it will not strictly enforce the mandate, so long as VoIP companies are making progress.

"Normally there could be fees associated with noncompliance," said Maribel Lopez, a vice president at Forrester Research. "But I think there might be some leniency. It was an incredibly short deadline to begin with, and given the fact that the (much older) wireless industry is still filing for extensions, it doesn't seem like they could impose stiff penalties."

Technical riddles
The level of compliance varies. Vonage, the best known VoIP provider, claims that 90 percent of its customers can connect to the routers in the E911 network, but not all of these connections have been fully tested, according to a letter filed with the FCC.

Vonage officials said about 26 percent of its customers can access local E911 networks that have been fully tested. The company expects to boost that figure to 67 percent in the next 30 days, and Vonage executives expect to reach 97 percent of their customers with fully tested E911 service by the middle of next year.

Vonage blames its lack of compliance on tricky technical issues and resistance company officials claim they've faced from some traditional phone companies.

In a Nov. 14 letter to FCC chairman Kevin Martin, Jeffrey Citron, CEO of Vonage, accused Qwest Communications of not fully cooperating with Vonage's efforts to identify "dummy numbers," or unassigned phone numbers, that can be used to link out-of-area phone numbers to a local E911 operator.