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Dayton’s stance on Internet voice service is a 20th-century policy

Minnesota had a real opportunity to bring our telecommunications regulatory structure into the 21st century this session by joining 34 other states in saying no to state-specific regulation of voice-over-Internet protocol services (“VoIP”) and other IP-enabled services. I was proud to author the original legislation (HF 776) and join with Sen. Dan Sparks (SF 895) in a bipartisan effort to help spur more telecom investment in the state.

Rep. Tim Sanders

This VoIP-IP legislation, which had bipartisan support in both the House and the Senate, made its way into the final deliberations of the Supplemental Budget Bill that included $35 million for the state’s broadband fund. Unfortunately, however, because of Gov. Mark Dayton’s adamant and unfounded opposition, those provisions were removed from the Supplemental Budget Bill on the last day of the recently concluded legislative session. It’s ironic that while the Dayton administration continues to call for more funding for the state broadband fund, it takes a “ regulate first” approach to the kinds of services that foster more broadband deployment and bring innovation to industry and consumers alike. It is the exact same VoIP service that the governor, my colleagues in the Legislature, and other members of the state government currently enjoy in their own offices.

Supported by Broadband Task Force

I wish Dayton’s administration would have heeded the policy recommendation of his own Broadband Task Force to modernize Minnesota’s telecommunications industry. It was a recommendation that was strongly supported by the Minnesota High Tech Association and its president and CEO, Margaret Anderson Kelliher, the former DFL House Speaker and chair of the Broadband Task Force.

Instead of siding with his own Broadband Task Force and 17 of his fellow current or former Democratic governors, like Gov. Jerry Brown of California and John Hickenlooper of Colorado, who have signed similar VoIP IP legislation into law, the governor chose to heed to the false alarms of the Minnesota Legal Aid Society and AARP Minnesota, which claimed that adoption of such legislation in Minnesota would cause customers to lose their traditional landline phones and telephone rates to go up. In fact, none of their false and misleading predictions has come true in any state where the bills have been signed into law. The consumer harms that have been predicted by these opponents of the VoIP bill have not been experienced in the more than 30 states that have passed similar legislation. Moreover, not a single state found it necessary to undo these laws.

The Dayton administration’s assertion that voice service delivered via the Internet should be regulated is a policy statement that harks back to the 20th century when landline phones were the only communications service available. In an era of unprecedented competition and growth in wireless, apps and devices, I fear that the Dayton administration is perfectly content to leave Minnesota there in the 20th century.

Rep. Tim Sanders, R-Blaine, represents District 37B in the Minnesota House of Representatives.


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Comments (7)

  1. Submitted by David Wintheiser on 06/20/2016 - 09:20 am.

    Opposition is understandable

    Having read the bills and compared them to similar bills that have passed in Colorado and California (as the author notes), I have to say that the opposition to this bill is warranted and understandable.

    The main difference between these bills in Minnesota and the bills passed in other states is that other states have relaxed regulatory restrictions on VOIP as part of a more comprehensive package of developing broadband and fiber-optic services in their states: Colorado not only relaxed regulation on VOIP services, but also deregulated landline services as a way to keep the two services competitive in an environment where not all consumers will necessarily want to switch from the landline service they’ve relied on for years. California, meanwhile, expressly allows the state to regulate VOIP services where required by federal law — meaning that the state can continue to regulate services for privacy concerns, accessibility concerns, and other issues that have already been covered in federal law. The House version of the bill seems to tap-dance around this, noting that existing regulations are ‘to the extent allowed by federal law’ and that the bill would neither curtail nor expand any authority granted by the Federal Communications Act of 1934. It’s possible the two different textual structures might be interchangable, but it seems to me that the more detailed handling of the language in the Minnesota bill might be deliberate, to allow certain loopholes where Minnesota is not obligated to enforce federal law.

    If handing over money and regulatory authority to industry is a 21st century virtue, then yes, I agree this bill is very 21st century. But if you grew up during a time when ‘dial tone’ was the most reliable technology in the world, and note how much less reliable internet service is today, then you might find continued regulation of VOIP services to be just the thing you want to ensure that industry is held to a high standard for a technology that is likely going to eventually be relied upon for emergency services (via VOIP 911 calls), and provides much greater opportunity for the harvesting of personal information than Plain Old Telephone Services (POTS) ever did.

  2. Submitted by Paul Udstrand on 06/20/2016 - 09:31 am.


    I would note that rather than discussing the VoIP-IP proposals and the nature of the regulation Dayton is proposing, Sanders simply spends his time attacking Dayton. At a time when the courts have just ruled that the internet is a public utility it’s seems odd that one would argue that VoIP shouldn’t be regulated in any way.

    Republicans love to talk about innovation but the frequently lack any real understanding of its actual nature. Basic ground rules don’t inhibit innovation, real innovation is about working with limitations, not eliminating limitations. Limitations on human testing don’t forestall or prevent Medtronic innovations. The “free market” unregulated approach to internet services has produced for Americans one of the most expensive, slowest, and least accessible high speed infrastructures in the world. There’s no reason to assume that rolling out VoIP the same way would work any better.

    And someone should probably explain to Sanders the fact that if you want something to become law, you need to work with the person who signs it into law… it think it’s called: “compromise” and it’s a standard feature of divided government. Again, what kind of “regulations” did Dayton want to see, and why wouldn’t you agree include them in order to get your bill passed?

  3. Submitted by Bruce Bednarek on 06/20/2016 - 10:32 am.

    Won’t lose their land line

    I’m far from being a techno-wizard but how can you retain a hard wired land line if VoIP prevails and traditional telephone service goes away? Help – anyone?

    • Submitted by Connie Sullivan on 06/20/2016 - 02:50 pm.

      You can’t, Bruce. If traditional land-line service is allowed to be terminated by CenturyLink the way former-Bell phone companies in the Eastern part of the U.S. have already applied to do, you won’t be able to have a traditional phone that works anymore.

      The AARP is rightly against bills like this, and against eliminating land lines that do such lovely things like provide fantastic sound and automatically tell the 911 operator where you’re making your call from (down to the apartment number!). There are significant ways in which the internet is more complicated, more unstable, more expensive, has more built-in obsolescence and fewer helpful services than traditional phones.

    • Submitted by Paul Udstrand on 06/20/2016 - 02:53 pm.

      In theory…

      VoIP is a land line in the sense that as an internet service it would use either existing cable or phone lines. However, someibe still has to build and maintain those lines and infrastructure which is why the public utility model worked so well for establishing traditional phone service in the first place. So yeah, if everyone is using Comcast or Centurylink lines but not enough people are paying Centurylink or Comcast to use those lines eventually the infrastructure eventually degrades.

      Most if not all of the State Government offices actually switched to VoIP a few years ago. While it has worked well by and large there have been some notable outages and glitches that simply didn’t happen with traditional land lines.

  4. Submitted by Bill Willy on 06/21/2016 - 03:05 pm.

    A pure ALEC bill

    “Starting in 2007, AT&T, Verizon, Centurylink and the cable companies, working with a group called the American Legislative Exchange Council (ALEC), created state-based model legislation and principles designed by the companies to accomplish one thing — the removal of all regulations, obligations and oversight on the companies’ businesses. 25 states have removed some, if not all regulations and oversight, and there are more to come . . .”

    Here’s the list of ALEC’s “Communications and Information Technology” members:

    Charter Communications
    Comcast Cable Communications
    Cox Communications, LLC
    The DIRECTV Group, Inc
    Time Warner Cable
    Verizon Communications

    This link leads to the “model legislation” — the “Advanced Voice Services Availability Act of 2007” — that group came up with and posted on ALEC’s web site (for easy sharing with sympathetic state legislators around the country like Pat Garofalo, Tim Sanders and several other Minnesota Republicans):

    And while the details of the “suggested” legislation vary in each of the bills that was passed in the (now) 34 states that have, as Tim puts it, “joined the 21st century,” the basic ALEC objectives behind them are:

    “Remove Regulation: ‘Basic Service,’ commonly known as ‘POTS,’ (Plain Old Telephone Service) and all other services including broadband or VoIP are ‘deregulated’ and the regulations and obligations are being removed on the incumbent utility.

    “Remove Oversight: The state commissions are being stripped of oversight capabilities and in many cases are ‘defunded,’ with major budget cuts to staff.

    “Remove ‘Quality of Service’: No more requirements or oversight, including the removal of any metrics or penalties if the company doesn’t fix services or supply quality service in a timely fashion – or at all.

    “Remove ‘Carrier of Last Resort’ (COLR): The companies had obligations to supply services to all customers—and this is now being diminished or removed completely.

    “Let the FCC Remove Competition: On the state level, the obligation of the incumbents to offer ‘wholesale services’ to competitors is now based on FCC and the Telecom Act rules, not state laws.

    “Remove Customer Protections — such as the ability to take the company to court instead of having to arbitrate based on the incumbent’s own contracts.”

    Here are the key provisions of Tim Sander’s bill that Gov Dayton and Senate Democrats stripped out of the budget bill:

    House File 776 is . . . “A bill for an act relating to telecommunications; prohibiting regulation of voice-over-Internet protocol service and Internet protocol-enabled service.”

    “Voice-over-Internet protocol service. ‘Voice-over-Internet protocol service’ or ‘VoIP service’ means any service that (1) enables real-time two-way voice communications that originate from or terminate at the user’s location in Internet protocol or any successor protocol, and (2) permits users generally to receive calls that originate on the public switched telephone network and terminate calls to the public switched telephone network.

    ” ‘Internet protocol-enabled service’ or ‘IP-enabled service’ means any service, capability, functionality, or application provided using Internet protocol, or any successor protocol, that enables an end user to send or receive a communication in Internet protocol format or any successor format, regardless of whether that communication is voice, data, or video.”

    After clearly defining the meaning of VoIP and “internet protocol-enabled services” (basically anything Minnesotans might do on the internet related to voice, data or video) the bill gets right to the ALEC-pushed heart of the matter. Here is the key to Tim Sander’s vision of how to move Minnesota into the 21 century. It’s in Section 3 of the bill:

    “REGUALATION PROHIBITED. Except as provided in this section, no state agency, including the commission and the Department of Commerce, or political subdivision of this state shall by rule, order, or other means directly or indirectly regulate the entry, rates, terms, quality of service, availability, classification, or any other aspect of VoIP service or IP-enabled service.”

    Isn’t that beautiful? Isn’t it visionary? Isn’t it reassuring? Don’t you wish the same kind of law applied to your electric bill, your water bill, your (current) phone bill? Notice how there is no mention of any standards whatsoever that those providing “internet protocol-enabled” services need to provide, how they need to provided them, etc. . . . Essentially, the bill is nothing more than a very clear proclamation that

    NO STATE AGENCY, including

    – the commission and Department of Commerce which, if I’m not mistaken, includes the Public Utilities Commission

    – or political subdivision of this state


    – by rule, order or other means directly or indirectly regulate

    – the entry

    – the rates

    – the terms

    – the quality of service

    – the availability

    – the classification

    – or ANY OTHER ASPECT of VoIP service or IP-enabled service.

    House File 776 bill does an excellent job of addressing most, if not all, of the original objectives of ALEC and its Communications and Information Technology members. That group is in the state-by-state process of doing all it can to create a regulation-free monopoly of “their part” of the internet (voice, data, video) — the next global goldmine — and Tim Sanders was only too happy to do what he could to be their pack mule.

    For him to have the nerve to author a Community Voices piece that accuses Mark Dayton of being out of touch while extolling the “bi-partisan” virtues of his “21st century telecommunications solution” and pretending it is something that would benefit all Minnesotans is yet another prime example and reminder of why it is NO Minnesotan should trust or vote for anyone running for office as a member of today’s version of the Republican party.

    And here’s a reminder of how fortunate Minnesotans were that Mark Dayton was elected in 2010 instead of Tom Emmer . . .

    “On May 23, 2011, Wisconsin Governor Scott Walker signed into law one of the first bills he requested, a radical deregulation of the telecommunications industry in Wisconsin. Under the bill, the Wisconsin Public Service Commission (PSC) could no longer set telecommunication rates to keep prices low for consumers, perform audits of providers, or investigate consumer complaints. It guts the PSC’s authority to regulate rates of basic phone service in areas with little or no competition…The bill tracks ALEC’s ‘Regulatory Modernization Act’ which prohibits any commission from regulating rates and charges, terms and conditions of services, mergers or acquisitions and more.”

    Now that Tim is retiring from the House and is so concerned about living someplace that has 21st century vision and laws, Wisconsin would seem like a great place for him to move.

  5. Submitted by christopher mitchell on 06/23/2016 - 12:48 pm.

    Thanks for Fighting for Price Increases

    Show me a single state where telecommunications deregulation has led to better service and lower prices for people. AARP is right about this.

    Maybe the only thing worse than 20th century regulations is 19th century robber barons screwing us.

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