Calif. ICS Authority Stops at Voice, Companies Warn

Consumer and prison inmate advocates urged the California Public Utilities Commission to regulate video calling and other non-voice services used by incarcerated people to communicate with their families. But big inmate calling service (ICS) providers said Friday the CPUC can’t regulate those products because they're Title I information services under the 1996 Telecom Act.

The CPUC sought comments in November (see 2111290059) on the legal question of whether it may regulate rates, fees and service quality for video calling services, written communications including SMS and email, and "entertainment services such as photo sharing, music or video entertainment and/or internet access services." The agency estimated a decision on legal jurisdiction would come about 90 to 120 days after replies are filed Feb. 28. The commission capped voice rates earlier in docket R.20-10-002 (see 2108190046).

“The timing is interesting … because states' regulatory powers got a big boost” Friday when the 9th U.S. Circuit Court of Appeals upheld California’s net neutrality law, Prison Policy Initiative General Counsel Stephen Raher emailed Monday. The court said the FCC can’t preempt states after giving up its own broadband authority (see 2201280057). PPI is involved in ICS regulatory proceedings in several states but isn’t “aware of any others that are actively looking at jurisdiction over non-voice calling services,” he said. The 9th Circuit decision strengthens California’s ability to tackle broadband-enabled ICS rates, said Brenda Villanueva, The Utility Reform Network (TURN) managing director-telecom.

CPUC President Alice Busching Reynolds must reassign the rulemaking to a new commissioner due to Martha Guzman Aceves leaving the commission to become administrator of EPA Region 9. The assigned administrative law judge will keep things moving meantime, emailed Paul Goodman, Center for Accessible Technology (CforAT) legal counsel: With replies due Feb. 28, a new commissioner should have “plenty of time to get up to speed.” No matter who's assigned, expect the proceeding to move ahead quickly, said Goodman. “It’s an enormously important issue to the Commission.”

The FCC never affirmatively declared classification for any ICS service, commented PPI, CforAT, TURN and the CPUC’s independent Public Advocates Office. The FCC and states regulated AT&T's failed Picturephone service from the 1960s and 1980s like a telecom service, and the 1996 act and FCC precedent say service classification “hinges on the nature of the service that the consumer uses, not by the end-user hardware or the technology used to manage the telecommunications system,” they said: Even if it were Title I, the FCC can’t preempt states, and no federal law would conflict with a CPUC rate cap. ICS providers are telephone corporations that the CPUC may regulate under state law, and the agency also has authority under state police power, the advocates said.

Video calling, like voice, is "an essential communicative tool for people who are incarcerated and their families,” but ICS providers charge exorbitantly, the advocates said. “Establishing rates for one while ignoring the other would fall short of achieving the CPUC’s goal of protecting these captive customers.”

"Unless the CPUC exercises jurisdiction over video calls, electronic messages, and related services, its intent will be frustrated” because companies “bundle regulated and unregulated services into their telecom contracts, allowing them to circumvent rate regulation on one revenue stream,” commented Californians for Jail and Prison Phone Justice Coalition. ICS “providers have preyed on incarcerated peoples’ basic human need for connection, charging as much as a dollar a minute for a video call that would have been free in the outside world,” it said. With in-person visits canceled due to the COVID-19 pandemic, “hundreds of thousands of Californians have been entirely dependent on phone calls, video calls, and electronic messages to communicate with their incarcerated loved ones.”

Prison video calls "depend on broadband technologies to be offered," making them "broadband-enabled services” that federal law and FCC rulings have determined to be information services, argued Global Tel*Link. Even if the CPUC had authority, “imposing rate caps and associated regulation on video and related services would not be in the public interest” because they would stifle growth and innovation, GTL said.

Securus said the FCC classified its video calling service as Title I. Law and precedent “readily demonstrates that video sessions and other services fall well outside of the CPUC’s statutorily defined authority,” it said. “When ... the state’s regulation inevitably includes regulating interstate services that the FCC has decided must be free of such regulation, the state’s effort must yield.”

CPUC regulation here “would have profound consequences for hundreds, if not thousands of companies that are not public utilities and likely are completely unaware that the CPUC is even considering extending its jurisdiction over these services,” warned Securus: The CPUC should suspend further consideration in the ICS docket until it undertakes a general rulemaking.

Text messaging and internet access services "are beyond the scope of both NARUC’s and the FCC’s calls for state action to address intrastate prison calling rates," and as information services are beyond the state's authority to regulate, commented CTIA. CalTel and other small LECs agreed that the CPUC lacks jurisdiction.