CPUC to Explore Service Review Power Beyond POTS

California stepped toward regulating VoIP, broadband and wireless service quality. The California Public Utilities Commission voted 5-0 at a virtual meeting Thursday to open a rulemaking sought by consumer advocates to update telecom service-quality standards and enforcement. The Voice on the Net (VON) Coalition warned that states are preempted from regulating interconnected VoIP.

Through a separate 5-0 vote on a consent agenda, the CPUC also adopted draft resolution T-17759 authorizing Dish Network’s wireless subsidiary to provide California LifeLine services and a revised proposal denying Dish’s April 28 petition to modify the state commission’s April 2020 T-Mobile/Sprint OK. Under the latter decision in docket A.18-07-011, the commission will punt on the companies’ recently resolved dispute over T-Mobile’s planned CDMA shutdown (see 2202240039 and 2202030042).

The CPUC would consider updating its service quality standards for landline and additionally applying them to VoIP, wireless and broadband, under a revised proposed rulemaking posted Monday. Also, the rulemaking would give the CPUC a chance to reconsider its 2016 enforcement framework under General Order 133-D, which lets telcos avoid paying fines by promising to invest twice the amount in their network. The rulemaking responds to a petition by the CPUC’s independent Public Advocates Office (see 2109290058). The CPUC intends to complete the proceeding within two years of the proposed order’s adoption, the draft said.

"Consumers increasingly rely on VoIP, wireless and broadband services rather than plain old telephone services for their communications needs,” said Commissioner Darcie Houck at the webcast meeting. "The commission has acknowledged this trend in many proceedings, but thus far we have not updated our service quality rules to reflect this change." The CPUC previously decided wireless and VoIP providers meet the definition of telephone corporations, including in a disaster-rules proceeding, she said.

Landlines are only about 5% of California communications subscriptions, said President Alice Reynolds. "This leaves the majority of consumers without protection." COVID-19 and increasing natural disasters increased the importance of protection, she added. Commissioner John Reynolds agreed the CPUC has a key role in monitoring services, though he noted the agency isn’t predetermining what standards should apply to VoIP, broadband or wireless.

Enforcement changes are overdue, Commissioner Cliff Rechtschaffen said. The CPUC policy allowing carriers to avoid fines by investing double the amount in their network “just hasn’t worked,” with the Communications Division finding it hasn’t resulted in service

The Voice on the Net Coalition disagrees the CPUC "has jurisdiction over VoIP providers with respect to establishing service quality obligations,” emailed counsel Glenn Richard of Pillsbury. “The application of these rules to VoIP would run afoul of the FCC’s 2004 Vonage decision and others issued after that make clear that state regulation of interconnected VoIP is preempted.” CTIA declined to comment.

"The issues to be addressed in the new rulemaking are significant and warrant close examination prior to any changes being implemented," said a California Cable and Telecommunications Association spokesperson.

AT&T and Frontier Communications faced penalties under the existing enforcement policy. "These metrics are outdated for landline service quality standards and we look forward to discussing our concerns about them with the commission," emailed an AT&T spokesperson: The carrier opposes applying the metrics to wireless and VoIP.

The Utility Reform Network “strongly supports California PUC efforts to improve service quality requirements and apply them to all essential communications services,” emailed Telecommunications Policy Director Regina Costa. “Unreliable phone and cell phone service puts lives at risk, and unreliable broadband jeopardizes people’s ability to work, attend school, use remote healthcare, and receive essential information.”

The rulemaking “would definitively take the CPUC into territory that it has walked around for the past couple of years,” said Tellus Venture Associates President Steve Blum. “Although there's a reasonably clear case history for it to more tightly regulate VoIP service, its authority over broadband service of all kinds and mobile voice service is debatable. But we'll never know if federal regulators have complete primacy in those industries unless the CPUC contests it. The only sure thing is that we're looking at many years of litigation at the state and federal levels before the question is finally answered.”

The existing enforcement mechanism doesn’t work, said Blum. “In theory, that investment has to be in addition to what's already planned, but since no one outside the companies themselves know what's planned, it's a meaningless requirement.”

The CPUC Communications Division found “that service quality of the companies subject to General Order 133-D had declined, that existing fines were insufficient, and that investment had been steered away from the facilities required to provide reliable standard telephone service," Downey Brand attorney Brian Cragg blogged March 9. "The investigations also found that telephone companies had made investments in broadband services that disproportionately serve higher-income communities."

The CPUC has sent analysis of existing state middle-mile infrastructure to the California Department of Technology, as required by the state’s $6 billion broadband law, the agency said Wednesday. The commission reported on location, affordability and open-access availability to inform the CDT-led effort to build a state middle-mile network. As required by the same law, the CPUC last month adopted a local assistance grant program (see 2202240048) and may vote April 7 on adopting rules for a $2 billion last-mile federal funding account (see 2203020062).