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 Federal  Communications  Commission  FCC  04-  27 
 Before  the  Federal  Communications  Commission 
 Washington,  D.  C.  20554 


 In  the  Matter  of 
 Petition  for  Declaratory  Ruling  that  pulver.  coms  Free  World  Dialup  is  Neither 
 Telecommunications  Nor  a  Telecommunications  Service 


 )  ) 
 )  ) 
 )  )  WC  Docket  No.  03-  45 


 MEMORANDUM  OPINION  AND  ORDER 
 Adopted:  February  12,  2004  Released:  February  19,  2004 
 By  the  Commission:  Chairman  Powell,  Commissioners  Abernathy  and  Martin  issuing  separate  statements;  Commissioner  Adelstein  concurring  in  part,  dissenting  in  part,  and  issuing  a  separate 
 statement;  and  Commissioner  Copps  dissenting  and  issuing  a  separate  statement. 


 I.  INTRODUCTION 
 1.  In  this  Memorandum  Opinion  and  Order  (Order),  we  declare  pulver.  coms  (Pulver)  Free  World  Dialup  (FWD)  offering  to  be  an  unregulated  information  service  subject  to 


 the  Commissions  jurisdiction.  In  so  doing,  we  remove  any  regulatory  uncertainty  that  has  surrounded  Internet  applications  such  as  FWD.  We  formalize  the  Commissions  policy  of 
 nonregulation  to  ensure  that  Internet  applications  remain  insulated  from  unnecessary  and  harmful  economic  regulation  at  both  the  federal  and  state  levels.  This  action  is  designed  to  bring 
 a  measure  of  regulatory  stability  to  the  marketplace  and  therefore  remove  barriers  to  investment  and  deployment  of  Internet  applications  and  services.  Offerings  such  as  FWD  promise 
 significant  consumer  benefits  in  the  form  of  lower  prices,  new  pricing  models  and  enhanced  functionality.  Accordingly,  our  action  is  part  of  a  number  of  initiatives  that  are  designed  to  bring 
 the  benefits  of  Internet  protocol-  based  (IP-  based)  services  to  American  consumers. 
 II.  BACKGROUND 
 2.  On  February  5,  2003,  Pulver  filed  a  petition  for  declaratory  ruling  requesting  that  the  Commission  declare  FWD  to  be  neither  a  telecommunications  service  nor 


 telecommunications  as  those  terms  are  defined  in  the  Communications  Act  of  1934,  as 
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 Federal  Communications  Commission  FCC  04-  27 
 amended  (Act).  1  Through  FWD,  Pulver  offers  users  of  broadband  Internet  access  services  the  opportunity  to  join  other  such  users  in  becoming  members  of  the  FWD  community  in  order  to 
 communicate  directly  with  one  another  over  the  Internet.  2  For  reasons  provided  below,  we  grant  Pulvers  petition  and  also  declare  FWD  to  be  an  unregulated  information  service  that  is  subject 
 to  Commission  jurisdiction.  3 
 3.  The  Act  defines  telecommunications  as  the  transmission,  between  or  among  points  specified  by  the  user,  of  information  of  the  users  choosing,  without  change  in  the  form  or 


 content  of  the  information  as  sent  and  received.  4  Telecommunications  service  is  defined  as  the  offering  of  telecommunications  for  a  fee  directly  to  the  public,  or  to  such  classes  of  users  as 
 to  be  effectively  available  directly  to  the  public,  regardless  of  the  facilities  used.  5  Information  service  is  defined  as  the  offering  of  a  capability  for  generating,  acquiring,  storing, 
 transforming,  processing,  retrieving,  utilizing,  or  making  available  information  via  telecommunications,  and  includes  electronic  publishing,  but  does  not  include  any  use  of  any 
 such  capability  for  the  management,  control,  or  operation  of  a  telecommunications  system  or  the  management  of  a  telecommunications  service.  6 


 2 
 1  Pulver  Petition  at  1.  The  Commission  requested  and  received  comment  on  Pulvers  petition.  See  Pleading 
 Cycle  Established  for  Comments  on  pulver.  com  Petition  for  Declaratory  Ruling,  WC  Docket  No.  03-  45,  Public  Notice,  DA  03-  439  (rel.  Feb.  14,  2003).  See  Appendix  for  a  list  of  commenters. 


 2  Pulver  Petition  at  2-  3.  Throughout  this  Order,  we  use  the  term  members  to  refer  to  those  Internet  users  that 
 have  joined  the  FWD  community  by:  registering  with  FWD;  obtaining  an  FWD  identifying  number;  acquiring  and  configuring  customer  premises  equipment  (CPE)  to  enable  peer-  to-  peer  communications  via  broadband  Internet 


 access;  and  making  such  communications  entirely  over  the  Internet  to  other  users  that  have  similarly  joined  FWD,  facilitated  by  information  obtained  from  FWD  in  order  to  do  so. 


 3  We  reach  our  holdings  in  this  Order  based  on  FWD  as  described  by  Pulver  in  its  petition  and  subsequent  ex 
 partes.  We  thus  limit  the  determinations  in  this  Order  to  Pulvers  present  FWD  offering  (only  to  the  extent  expressly  described  below),  without  regard  to  any  possible  future  plans  Pulver  may  have.  See,  e.  g.,  BellSouth 


 Comments  at  4  &  n.  13  (quoting  a  Pulver  press  statement  about  eventually  charging  a  fee);  USTA  Reply  at  4  (citing  SBC  Comments  at  2  that  FWD  may  eventually  enable  calls  to  users  outside  the  FWD  community).  Furthermore, 
 this  declaratory  ruling  addresses  FWD  only  to  the  extent  it  facilitates  free  communications  over  the  Internet  between  one  on-  line  FWD  member  using  a  broadband  connection  and  other  on-  line  FWD  members  using  a  broadband 
 connection.  Therefore,  we  specifically  decline  to  extend  our  classification  holdings  to  the  legal  status  of  FWD  to  the  extent  it  is  involved  in  any  way  in  communications  that  originate  or  terminate  on  the  public  switched  telephone 
 network,  or  that  may  be  made  via  dial-  up  access.  See  Letter  from  Susan  M.  Hafeli,  Counsel,  pulver.  com,  to  Marlene  H.  Dortch,  Secretary,  Federal  Communications  Commission,  WC  Docket  No.  03-  45,  at  1  (filed  Dec.  11, 
 2003)  (Pulver  Dec.  11  Ex  Parte  Letter)  (acknowledging  that  third  parties  can  provide  FWD  subscribers  with  connectivity  to  the  public  switched  telephone  network  without  Pulvers  permission).  Rather,  we  will  address  the 
 legal  status  of  those  communications  in  our  companion  IP-  Enabled  Services  rulemaking. 
 4  47  U.  S.  C.    153(  43). 


 5  47  U.  S.  C.    153(  46). 
 6  47  U.  S.  C.    153(  20). 
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 Federal  Communications  Commission  FCC  04-  27 
 4.  FWD  is  an  Internet  application.  The  Internet  is  a  distributed  packet-  switched  network  of  interconnected  computers  enabling  people  around  the  world  to  communicate  with 
 one  another,  invoke  multiple  Internet  services  simultaneously  and  access  information  with  no  knowledge  of  the  physical  location  of  the  server  where  that  information  resides.  7  The  Internet 
 represents  a  paradigmatic  shift  in  network  technology:  intelligence  in  the  system  no  longer  resides,  as  it  did  in  the  legacy  circuit-  switched  network,  primarily  in  the  network  itself,  but  has 
 instead  migrated  to  the  edge  of  a  vastly  different  type  of  network    to  the  end  users  CPE.  FWD  is  an  example  of  this  migration  because,  as  explained  below,  Pulvers  service  bears  no 
 geographic  correlation  to  any  particular  underlying  physical  transmission  facilities.  FWD  depends  on  whether  a  user  can  establish  a  presence  on  the  network  at  some  point,  not  whether 
 the  user  can  access  the  network  from  a  specific  geographically  defined  end  point.  Internet  applications  like  FWD  thus  separate  the  user  from  geography  and  the  application  enabling  voice 
 or  other  types  of  communication  from  the  network  over  which  the  communication  occurs. 
 5.  As  described  by  Pulver,  FWD  offers  users  of  broadband  Internet  access  the  opportunity  to  join  other  such  users  worldwide  in  talking  with  one  another  directly  over  the 


 Internet  as  well  as  communicating  directly  via  video  or  text.  8  FWD  facilitates  this  interactive  communication  capability  by  offering  such  users  the  ability  to  become  FWD  members  through 
 an  initial  registration  process  followed  by  the  new  member  complying  with  other  requirements  specified  by  FWD  that  are  necessary  to  enable  communications  to  be  made.  9  Specifically, 
 members  must  have  an  existing  broadband  Internet  access  service  as  Pulver  does  not  offer  any  transmission  service  or  transmission  capability.  10  In  addition,  members  must  acquire  and 
 appropriately  configure  Session  Initiation  Protocol  (SIP)  phones  or  download  software  that  enables  their  personal  computers  to  function  as  soft  phones.  11  Once  these  criteria  are  met, 
 anyone  anywhere  in  the  world  can  obtain  a  Pulver-  assigned  five-  or  six-  digit  FWD  number  (not  a 


 3 
 7  See,  e.  g.,  GTE  Telephone  Operating  Cos.,  GTE  Tariff  No.  1,  GTOC  Transmittal  No.  1148,  CC  Docket  No.  98- 
 79,  Memorandum  Opinion  and  Order,  13  FCC  Rcd  22466,  22468,  para.  5  (1998)  (GTE  ADSL  Order). 
 8  Pulver  Petition  at  3;  Pulver  Reply  at  2-  3  &  n.  2. 


 9  Id.  Pulver  indicates  it  does  not  verify  the  identifying  information  members  submit  on  the  FWD  registration 
 screen  such  as  name,  address,  state  or  country.  See  Letter  from  Susan  M.  Hafeli,  Counsel,  pulver.  com,  to  Marlene  H.  Dortch,  Secretary,  Federal  Communications  Commission,  WC  Docket  No.  03-  45,  at  1  (filed  Dec.  16,  2003) 


 (Pulver  Dec.  16  Ex  Parte  Letter). 
 10  Pulver  Petition  at  3.  According  to  Pulver,  its  service  operates  with  any  type  of  broadband  connection  (e.  g., 
 cable  modem,  digital  subscriber  line,  satellite,  or  wireless).  Id.  As  noted  above,  we  do  not  address  FWD  to  the  extent  it  may  be  usable  via  dial-  up  access.  See  supra  note  3. 


 11  Pulver  Petition  at  3-  4.  Session  Initiation  Protocol  is  an  application-  layer  control  (signaling)  protocol  for 
 creating,  modifying,  and  terminating  sessions  with  one  or  more  participants.  These  sessions  include  Internet  telephone  calls,  multimedia  distribution,  and  multimedia  conferences.  See  J.  Rosenberg  et  al,  "SIP:  Session 


 Initiation  Protocol"  RFC  3261,  June  2002;  see  also  Letter  from  A.  Renee  Callahan,  Counsel,  to  Marlene  Dortch,  Secretary,  Federal  Communications  Commission,  WC  Docket  No.  03-  45,  at  n.  5  (filed  Dec.  12,  2003)  (MCI  Dec.  12 
 Ex  Parte  Letter). 
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 Federal  Communications  Commission  FCC  04-  27 
 North  American  Numbering  Plan  (NANP)  number)  12  to  facilitate  using  the  members  broadband  service  to  make  free  voice  over  Internet  Protocol  (VoIP)  or  other  types  of  peer-  to-  peer 
 communications  to  other  FWD  members.  13  According  to  Pulver,  it  neither  knows  nor  needs  to  know  where  its  members  are  geographically  located  in  order  for  its  members  to  use  FWD.  14  In 
 addition,  Pulver  indicates  it  can  not  determine  its  members  geographic  location.  15  Once  an  FWD  member  obtains  its  FWD  number,  that  number  is  completely  portable  to  any  broadband-accessible 
 location  to  which  that  member  may  go.  16  Moreover,  FWD  members  may  not  even  know  where  other  members  are  physically  located  during  any  given  communication  session  with 
 another  member  as  FWD  enables  members  to  register  up  to  25  different  locations  for  potential  receipt  of  communications  from  other  members,  any  one  of  which  locations  may  end  up  being 
 the  Internet  address  from  where  the  communication  is  actually  answered.  17 
 6.  According  to  Pulver,  FWD  acts  as  a  directory  or  translation  service,  informing  its  members  when  other  members  are  online  or  present,  thus  available  to  receive  a  call,  as  well  as 


 informing  them  of  the  Internet  address  necessary  to  reach  other  members  during  their  on-  line  presence.  18  Moreover,  Pulver  indicates  that  FWD:  offers  voice  mail  capabilities  to  those 
 members  who  opt-  in  to  this  function;  offers  conference  bridging  capabilities  to  members;  and  performs  limited  Internet  address  repair  for  its  members.  19  Although  FWD  facilitates  VoIP  or 
 other  types  of  communications  over  the  Internet  between  its  members,  Pulver  indicates  that  FWD  is  merely  an  Internet  application  that  provides  its  members  information  that  those  members 


 4 
 12  Pulver  Petition  at  3;  Pulver  Dec.  11  Ex  Parte  Letter  at  2-  3. 
 13  Peer-  to-  peer  is  a  communications  model  in  which  each  party  has  the  same  capabilities  and  either  party  can 
 initiate  a  communication  session.  In  recent  usage,  peer-  to-  peer  has  come  to  describe  applications  in  which  users  can  use  the  Internet  to,  for  example,  exchange  files  with  each  other  directly  or  through  a  mediating  server.  See 


 http://  searchnetworking.  techtarget.  com/  sDefinition/  0,sid7_  gci212769,00.  html. 
 14  See  Pulver  Dec.  16  Ex  Parte  Letter  at  1-  2. 


 15  Id.  In  fact,  the  record  shows  that  it  is  impractical  or  impossible  for  Pulver  to  obtain  member  location 
 information  (i.  e.,  the  originating  and  terminating  points)  for  any  given  communication  between  its  members.  According  to  Pulver,  since  it  manages  only  the  signaling  component  of  the  call,  it  has  access  only  to  the 


 application  layer  of  the  network  and,  thus,  the  information  available  to  it  is  inadequate  to  determine  the  actual  physical  location  of  an  underlying  IP  address.  Id. 


 16  Id;  see  also  Letter  from  Scott  Blake  Harris,  Counsel,  Cisco,  to  Marlene  Dortch,  Secretary,  Federal 
 Communications  Commission,  WC  Docket  No.  03-  45,  at  3-  4  (filed  Dec.  11,  2003)  (Cisco  Dec.  11  Ex  Parte  Letter). 
 17  See  Letter  from  Glenn  S.  Richards,  Counsel,  pulver.  com,  to  Marlene  H.  Dortch,  Secretary,  Federal 
 Communications  Commission,  WC  Docket  No.  03-  45,  at  1  (filed  Jan.  20,  2004)  (Pulver  Jan.  20  Ex  Parte  Letter). 
 18  Pulver  Dec.  11  Ex  Parte  Letter  at  2. 


 19  Pulver  Dec.  11  Ex  Parte  Letter  at  2;  Pulver  Jan.  15  Ex  Parte  Letter. 
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 Federal  Communications  Commission  FCC  04-  27 
 use  to  communicate  with  other  members.  20  Pulver  states  that  it  is  the  members  end-  user  devices,  not  Pulver,  that  establish  the  actual  connections  and  manage  the  calls.  21 
 7.  According  to  Pulver,  its  FWD  service  is  not  telecommunications  because  Pulver  provides  no  transmission  capabilities  to  its  members  and  is  not  a  telecommunications 
 service  because  Pulver  neither  provides  telecommunications  nor  charges  any  fee  for  its  FWD  service.  22  Finally,  in  its  petition  and  in  an  ex  parte  filing,  Pulver  has  argued  that  FWD  cannot  be 
 an  information  service,  as  that  term  is  defined  in  the  Act,  because  FWD  provides  no  data  transport  with  its  computing  capabilities.  23  In  determining  the  regulatory  classification  of  FWD, 
 we  examine  only  the  specific  functions  FWD  provides  its  members  as  described  above. 
 III.  DISCUSSION 
 8.  For  the  reasons  discussed  below,  we  declare  that  FWD  is  neither  telecommunications  nor  telecommunications  service  as  defined  in  the  Act  and  as  interpreted 


 by  the  Commission.  Moreover,  we  declare  that  FWD  is  an  unregulated  information  service  subject  to  federal  jurisdiction.  24 


 5 
 20  Pulver  Dec.  11  Ex  Parte  Letter  at  2. 
 21  Pulver  Dec.  11  Ex  Parte  Letter  at  2-  3  (noting  with  support  Electronic  Frontier  Foundations  statement  that 
 FWD  simply  allows  FWD  subscribers  to  use  telephone-  like  5-  or  6-  digit  numbers  to  locate  and  call  other  FWD  subscribers,  much  as  DNS  translation  allows  Internet  users  to  use  http://  www.  eff.  org  instead  of 


 http://  209.237.229.14.). 
 22  Pulver  Petition  at  7. 


 23  Pulver  Petition  at  n.  9;  Pulver  Dec.  11  Ex  Parte  Letter  at  3-  4  . 
 24  We  reject  the  argument  that  Pulver  has  failed  to  demonstrate  that  there  is  a  controversy  or  uncertainty 
 surrounding  its  offering  that  warrants  a  declaratory  ruling.  See,  e.  g.,  BellSouth  Comments  at  2-  4,  6;  Global  Crossing  Comments  at  1;  SBC  Comments  at  1-  3;  AT&  T  Reply  at  2.  Based  on  the  record  in  this  proceeding  and  in 


 accordance  with  our  rules,  it  is  evident  that  there  is  sufficient  uncertainty  about  the  classification  of  Pulvers  service  offering  to  warrant  a  declaratory  ruling.  We  also  determine  that,  given  the  discrete  nature  of  Pulvers  offering,  it  is 
 unnecessary  to  forgo  ruling  on  the  petition  until  after  completion  of  a  general  IP-  enabled  rulemaking.  See,  e.  g.,  BellSouth  Comments  at  4,  6-  7;  Global  Crossing  Comments  at  2;  Verizon  Comments  at  1-  2;  USTA  Comments  at  4- 
 6;  Minnesota  Dept.  of  Commerce  Reply  at  2-  3.  We  acknowledge  the  concerns  of  local  governments  that  we  not  prejudge  in  this  Order  any  questions  regarding  public  safety,  consumer  welfare,  and  the  role  of  local  government   
 all  of  which  are  presented  in  the  IP-  Enabled  Services  rulemaking,  in  which  we  will  examine  them  in  detail.  See  Letter  from  Matthew  C.  Ames,  Counsel  for  National  League  of  Cities  et  al.,  to  Marlene  H.  Dortch,  Secretary, 
 Federal  Communications  Commission,  WC  Docket  Nos.  02-  361,  03-  45,  03-  211  &  03-  251  (filed  Jan.  16,  2004).  The  Department  of  Justice  has  informed  the  Commission  that  it  plans  to  file  a  petition  for  rulemaking  asking  the 
 Commission  to  initiate  a  comprehensive  rulemaking  to  address  law  enforcement's  needs  relative  to  CALEA.  The  Commission  recognizes  the  importance  of  ensuring  that  law  enforcements  requirements  are  fully  addressed.  The 
 Commission  takes  seriously  the  issues  raised  by  law  enforcement  agencies  concerning  lawfully  authorized  wiretaps.  Accordingly,  the  Commission  plans  to  initiate  a  rulemaking  proceeding  in  the  near  future  to  address  the  matters  we 
 anticipate  will  be  raised  by  law  enforcement,  including  the  scope  of  services  that  are  covered,  who  bears  responsibility  for  compliance,  the  wiretap  capabilities  required  by  law  enforcement,  and  acceptable  compliance 
 standards.  Our  decision  in  this  Order  does  not  prejudice  the  outcome  of  our  proceeding  on  CALEA.  See  Letter  (continued.) 
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 Federal  Communications  Commission  FCC  04-  27 
 A.  Classification  of  FWD 
 9.  First,  we  conclude  that  FWD  is  not  telecommunications.  25  Under  the  statute,  the  heart  of  telecommunications  is  transmission.  26  As  explained  above,  Pulver  neither  offers 


 nor  provides  transmission  to  its  members.  Rather,  FWD  members  bring  their  own  broadband  transmission  to  interact  with  the  FWD  server.  27  At  least  one  commenter  has  argued  that  FWD  is 
 telecommunications  because  FWD  does  not  change  the  form  or  content  of  the  information  as  sent  and  received.  28  We  disagree.  FWD  acts  as  a  type  of  directory  service,  informing  its 
 members  when  fellow  members  are  online  or  present.  29  Thus,  even  if  FWD  were  providing  transmission  (which  it  is  not),  the  information  that  FWD  provides  is  not  information  of  the 
 users  choosing,  without  change  in  the  form  or  content  of  the  information  as  sent  and  received.  30  Instead,  FWD  provides  new  information:  whether  other  FWD  members  are  present;  at  what  IP 
 address  a  member  may  be  reached;  or,  in  some  cases,  a  voicemail  or  an  email  response.  31  Finally,  the  fact  that  Pulvers  server  is  connected  to  the  Internet  via  some  form  of  transmission  is 
 not  in  and  of  itself,  as  some  commenters  argue,  relevant  to  the  definition  of  telecommunications.  32  Pulver  may  use  some  telecommunications  to  provide  its  FWD  directory 
 service  but  that  does  not  make  FWD  itself  telecommunications. 


 6 
 (Continued  from  previous  page)  from  John  G.  Malcolm,  Deputy  Assistant  Attorney  General,  Department  of  Justice,  to  Marlene  H.  Dortch,  Secretary, 
 Federal  Communications  Commission,  CC  Docket  Nos.  02-  33,  95-  20,  &  98-  10;  CS  Docket  No.  02-  52;  WC  Docket  Nos.  03-  45,  03-  211,  &  02-  361  (filed  Feb.  6,  2004);  see  also  Letter  from  Patrick  W.  Kelley,  Deputy  General 
 Counsel,  FBI,  to  John  Rogovin,  General  Counsel,  Federal  Communications  Commission,  CC  Docket  Nos.  97-  213,  02-  33,  95-  20,  &  98-  10;  CS  Docket  No.  02-  52;  WC  Docket  Nos.  02-  361,  03-  45,  03-  211,  03-  251  &  03-  266  (filed 
 Jan.  28,  2004);  DOJ/  FBI  Comments  at  2-  3. 
 25  We  note  that  most  commenters  agree  with  this  conclusion.  See,  e.  g.,  Cisco  Comments  at  1;  Global  Crossing 
 Comments  at  2;  VON  Coalition  Comments  at  1;  Electronic  Frontier  Foundation  Reply  at  1.  But  see  Qwest  Comments  at  8-  9  (arguing  that  Pulver  utilizes  telecommunications  as  the  delivery  vehicle  when  it  provides  the 


 information  service  described  in  its  petition). 
 26  See  supra  para.  3. 


 27  Pulver  Petition  at  7. 
 28  See  Verizon  Comments  at  2-  3. 
 29  Electronic  Frontier  Foundation  Reply  at  2;  Pulver  Dec.  11  Ex  Parte  Letter  at  2. 
 30  See  47  U.  S.  C.    153(  43)  (definition  of  telecommunications);  see  also  Pulver  Reply  at  3  (explaining  that  FWD 
 does  not  transmit  information  of  the  users  choosing  without  change  in  the  form  or  content  of  the  information  as  sent  and  received). 


 31  See  Pulver  Dec.  11  Ex  Parte  Letter  at  2;  Letter  from  Glenn  S.  Richards,  Counsel,  pulver.  com,  to  Marlene  H. 
 Dortch,  Secretary,  Federal  Communications  Commission,  WC  Docket  No.  03-  45,  Attach.  at  16  (filed  Jan.  15,  2004)  (Pulver  Jan.  15  Ex  Parte  Letter). 


 32  See  SBC  Comments  at  3. 
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 Federal  Communications  Commission  FCC  04-  27 
 10.  We  also  conclude  that  FWD  is  not  a  telecommunications  service.  33  Section  153(  46),  the  definition  of  telecommunications  service,  refers  to  an  offering  of 
 telecommunications.  As  discussed  above,  however,  FWD  does  not  offer  telecommunications.  Therefore,  it  cannot  be  a  telecommunications  service.  In  addition,  as  its  name  suggests,  FWD 
 is  free  of  charge  to  users  and,  in  order  to  be  a  telecommunications  service,  the  service  provider  must  assess  a  fee  for  its  service.  34  Accordingly,  because  we  determine  that  FWD  is  not  a 
 telecommunications  service,  the  common  carriage  obligations  applicable  to  the  provision  of  such  service  as  set  forth  in  Title  II  do  not  apply.  35 


 7 
 11.  We  conclude  that  FWD  is  an  information  service  because  FWD  offers  a  capability  for  generating,  acquiring,  storing,  transforming,  processing,  retrieving,  utilizing,  or 
 making  available  information  via  telecommunications.  36  Through  its  server  accessible  over  the  Internet,  FWD  makes  available  to  its  members  information  that  enables  them  to  determine 
 whether  other  members  are  available  to  talk;  information  on  how  to  contact  other  members;  and  an  optional  voicemail  capability  that  enables  members  to  leave  messages  for  unavailable 
 members  who  have  chosen  this  feature.  37  Specifically,  FWD  offers  its  members  a  number  of  computing  capabilities.  38  First,  FWD  enables  its  members  to  acquire  information  about 
 other  members  online  presence  at  any  particular  time  (similar  to  an  instant  messaging  service).  39  Second,  FWD  stores  both  member  information  (e.  g.,  assigned  numbers)  and,  if  a  member  opts-in, 
 voicemail  messages  on  its  server,  that  are  accessible  to  other  members.  40  Third,  Pulver  provides  members  with  certain  information  (i.  e.,  identifying  numbers  and  passwords)  that  they 
 utilize  first  to  register  for  the  FWD  service  and  then  to  contact  other  members  who  are  online.  41  Fourth,  the  FWD  service  processes  the  SIP  invite  (i.  e.,  the  information  an  initiating 


 33  We  note  that  commenters  agree  with  this  conclusion.  See,  e.  g.,  Cisco  Comments  at  1;  Global  Crossing 
 Comments  at  2;  Qwest  Comments  at  1;  Verizon  Comments  at  3;  VON  Coalition  Comments  at  1;  AT&  T  Reply  at  3. 
 34  See  47  U.  S.  C.    153(  46)  (definition  of  telecommunications  service). 


 35  See  generally  47  U.  S.  C.    201  et  seq. 
 36  See  47  U.  S.  C.    153(  20).  Commenters  agree  that  FWD  is  an  information  service.  See,  e.  g.,  Qwest 
 Comments  at  1-  2,  6-  9;  MCI  Dec.  12  Ex  Parte  Letter  at  2. 
 37  See  Pulver  Petition  at  4;  Pulver  Dec.  11  Ex  Parte  Letter  at  2.  We  note  that  the  Commission  has  previously 
 determined  that  voicemail  is  an  information  service  and  has  exerted  ancillary  Title  I  jurisdiction  over  the  provision  of  such  an  information  service.  See,  e.  g.,  Implementation  of  Sections  255  and  251(  a)(  2)  of  the  Communications  Act 


 of  1934,  as  Enacted  by  the  Telecommunications  Act  of  1996;  Access  to  Telecommunications  Service,  Telecommunications  Equipment  and  Customer  Premises  Equipment  by  Persons  with  Disabilities,  WT  Docket  No. 
 96-  198,  Report  and  Order  and  Further  Notice  of  Inquiry,  16  FCC  Rcd  6417,  6457,  paras.  97-  98  (1999)  (Section  255  Order). 


 38  Pulver  Dec.  11  Ex  Parte  Letter  at  4. 
 39  Pulver  Petition  at  4. 
 40  Pulver  Dec.  11  Ex  Parte  Letter  at  2. 
 41  Pulver  Petition  at  3. 
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 Federal  Communications  Commission  FCC  04-  27 
 member  sends  to  the  FWD  server  indicating  it  wishes  to  communicate  with  a  recipient  member)  by  determining  both  the  recipient  members  Internet  addresses  and  online  availability.  42  Once 
 FWD  determines  that  the  recipient  member  is  available  online,  it  makes  available  the  SIP  invite  to  that  recipient  member.  43  Making  available  the  Internet  addresses  of  the  intended 
 recipient  member  enables  the  initiating  member  to  retrieve  this  information.  44  Finally,  if  a  members  equipment  generates  a  private  Internet  address  that  interferes  with  the  ability  of  the 
 users  CPE  to  determine  public  Internet  addresses,  FWD  will  transform  or  repair  the  addressing  information  and  will  relay  the  signaling  and  media  stream  via  a  protocol  conversion 
 solution  to  facilitate  delivery.  45 
 12.  In  the  case  of  each  of  these  specific  functions,  Pulver  is  offering  FWD  members  the  capability  of  generating,  acquiring,  storing,  transforming,  processing,  retrieving,  utilizing  or 


 making  available  information  in  a  way  contemplated  by  the  Act  to  qualify  as  an  information  service.  We  also  acknowledge  that  after  performing  these  specific  functions,  Pulver  no  longer 
 plays  a  role  in  the  exchange  of  information  between  its  members  (except  for  relaying  a  SIP  bye  message  generated  by  one  of  the  users  when  the  communication  is  terminated)    it  merely 
 facilitates  peer-  to-  peer  communication.  The  fact  that  the  information  service  Pulver  is  offering  happens  to  facilitate  a  direct  disintermediated  voice  communication,  among  other  types  of 
 communications,  in  a  peer-  to-  peer  exchange  cannot  and  does  not  remove  it  from  the  statutory  definition  of  information  service  and  place  it  within,  for  example,  the  definition  of 
 telecommunications  service.  To  find  otherwise  would  not  only  ignore  the  fact  that  Pulver  does  not  provide  telecommunications,  as  explained  above,  but  also  ignore  the  capabilities  described 
 above  that  FWD  makes  available  to  its  members. 
 13.  At  least  one  commenter  has  suggested  that  FWD  is  not  an  information  service  because  it  falls  within  the  definitions  exception  for  the  management,  control  or  operation  of  a 


 telecommunications  system  or  the  management  of  a  telecommunications  service.  46  We  disagree.  Examining  the  plain  language  of  the  definition  dictates  a  finding  that  the  exception 


 8 
 42  Electronic  Frontier  Foundation  Reply  at  2-  3;  see  also  Pulver  Dec.  11  Ex  Parte  Letter  at  2  (stating  that 
 Electronic  Frontier  Foundations  Reply  accurately  describe[  s]  FWD  as  it  is  currently  available). 
 43  Electronic  Frontier  Foundation  Reply  at  2-  3.  Similarly,  if  the  recipient  member  is  not  online,  FWD  makes 
 available  that  information  to  the  initiating  member  as  well.  Pulver  Dec.  11  Ex  Parte  Letter  at  2. 
 44  Qwest  Comments  at  4;  Electronic  Frontier  Foundation  Reply  at  7. 


 45  Pulver  Dec.  11  Ex  Parte  Letter  at  2. 
 46  See  Letter  from  Kathleen  M.  Grillo,  Verizon,  to  Marlene  H.  Dortch,  Secretary,  Federal  Communications 
 Commission,  WC  Docket  No.  03-  45  &  03-  211  at  5  (filed  Feb.  5,  2004)  (Verizon  Feb.  5  Ex  Parte  Letter);  see  also  supra  para.  3  and  n.  6.  In  the  Non-  Accounting  Safeguards  Order,  the  Commission  recognized  that  certain 


 capabilities  previously  treated  as  basic  services  when  provided  by  a  carrier  fell  within  the  telecommunications  management  exception:  adjunct-  to-  basic  services  and  no  net  protocol  processing.  Implementation  of  the  Non-Accounting 
 Safeguards  of  Sections  27  and  272  of  the  Communications  Act  of  1934,  as  amended,  First  Report  and  Order  and  Further  Notice  of  Proposed  Rulemaking,  11  FCC  Rcd  21905,  21957-  58,  paras.  106-  07  (1996)  (Non-Accounting 
 Safeguards  Order),  clarified  in  Order  on  Reconsideration,  12  FCC  Rcd  2297,  2298-  99,  para.  2  (1997). 
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 Federal  Communications  Commission  FCC  04-  27 
 could  not  apply  to  Pulver  because  Pulver  is  not  managing  a  telecommunications  system  or  telecommunications  service.  Examining  the  history  of  the  text  and  Commission  precedent 
 supports  the  same  result.  The  telecommunications  management  exception  was  initially  included  in  the  definition  of  information  service  contained  in  the  Modification  of  Final  Judgment.  47 
 That  definition  explained  what  services  the  BOCs  were  not  permitted  to  offer  while  recognizing  that  certain  computer  processing  capabilities  were  permitted  within  the  provision  of  their 
 regulated  services.  Thus,  the  telecommunications  management  exception  permitted  the  BOCs  to  improve  their  telecommunications  networks  without  running  afoul  of  the  restriction  on  providing 
 information  services.  48  Prior  to  the  MFJ  and  divestiture,  the  Commission  had  permitted  certain  computing  capabilities  to  be  incorporated  into  AT&  Ts  telecommunications  network  to  facilitate 
 and  modernize  the  provision  and  use  of  basic  telephone  service.  49  This  does  not  mean  that  when  Pulver  or  another  information  services  provider  offers  these  capabilities  on  a  stand-  alone  basis 
 that  they  are  transformed  into  telecommunications  services.  50 
 14.  We  reject  Pulvers  reading  of  the  definition  of  information  service.  Pulver  argues  that  FWD  cannot  be  an  information  service  as  that  term  is  defined  in  the  Act  because 


 Pulver  does  not  offer  transmission  to  its  members.  51  However,  the  statutory  definition  of  an  information  service  speaks  only  to  the  offering  of  various  types  of  computing  capabilities  via 
 telecommunications,  not  the  offering  of  telecommunications  itself.  The  fact  that  FWDs 


 9 
 47  See  United  States  v.  American  Tel.  &  Tel.  Co.,  552  F.  Supp.  131,  229  (D.  D.  C.  1982)  (subsequent  history 
 omitted);  Joint  Managers  Statement,  S.  Conf.  Rep.  No.  104-  230,  104th  Cong.,  2d  Sess.  (1996)  at  114. 
 48  See  American  Tel.  &  Tel.,  552  F.  Supp.  at  227,  229. 


 49  See  Amendment  of  Section  64.702  of  the  Commission's  Rules  and  Regulations  (Second  Computer  Inquiry), 
 Docket  No.  20828,  Final  Decision,  77  FCC  2d  384,  419-  428  (1980)  (Computer  II  Final  Decision)  (noting  those  computer  processing  capabilities  directly  related  to  the  provision  of  the  basic  service  that  telephone  companies  were 


 able  to  provide  as  part  of  their  tariffed  basic  service  (later  termed  adjunct-  to  basic  services,  see  North  American  Telecommunications  Association  Petition  For  Declaratory  Ruling  Under  Section  64.702  of  the  Commission's  Rules 
 Regarding  the  Integration  of  Centrex,  Enhanced  Services,  and  Customer  Premises  Equipment,  ENF  84-  2,  Memorandum  Opinion  And  Order,  101  FCC  2d  349,  358-  61  (1985)  (NATA  Centrex));  Amendment  of  Section 
 64.702  of  the  Commission's  Rules  and  Regulations  (Second  Computer  Inquiry),  Docket  No.  20828,  Memorandum  Opinion  And  Order,  84  FCC  2d  50,  60-  61  (1980)  (Computer  II  Reconsideration  Order)  (recognizing  certain 
 protocol  conversion  capabilities  may  occur  internal  to  a  carriers  network);  Computer  II  Final  Decision,  77  FCC  2d  at  421;  Communications  Protocols  under  Section  64.702  of  the  Commission's  Rules  and  Regulations,  Gen.  Docket 
 No.  80-  756,  95  FCC  2d  584,  para.  29  (1983)  (Protocols  Order). 
 50  Indeed,  in  discussing  various  types  of  signaling  that  occurs  within  a  basic  service,  the  Commission  noted  that 
 certain  protocol  processing  network  functions  intrinsic  therein  may  be  properly  associated  with  basic  service  without  changing  its  nature,  or  with  an  enhanced  service  without  changing  the  classification  of  the  latter  as 


 unregulated  under  Title  II  of  the  Act.  Protocols  Order,  95  FCC  2d  at  para.  15.  We  note  that  FWD  is  different  from  signaling  networks.  While  FWD  does  provide  information  that  members  use  to  initiate  communications  among 
 themselves,  FWD  does  not  manage  the  resulting  disintermediated  communication.  That  is  managed  by  the  members  themselves.  In  addition,  FWD  provides  many  features  not  offered  by  signaling  networks  (e.  g.,  directory 
 look-  up,  voice  mail,  emailed  responses,  conferencing  capabilities,  and  address  repair). 
 51  Pulver  Dec.  11  Ex  Parte  Letter  at  3-  4  (arguing  that  an  information  service  provider  must  offer  data  transport). 
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 Federal  Communications  Commission  FCC  04-  27 
 computing  capabilities,  as  described  above,  are  available  to  its  members  via  telecommunications    i.  e.,  the  telecommunications  underlying  its  members  Internet 
 connectivity;  the  telecommunications  connecting  Pulvers  FWD  server  to  the  Internet;  and  the  telecommunications  underlying  the  Internet  backbone  itself    is  sufficient  to  meet  the  statutory 
 definition  of  information  service.  52  In  explaining  the  difference  between  enhanced  services  and  information  services,  the  Commission  previously  noted  that  the  former  are  limited  to 
 services  offered  over  common  carrier  transmission  facilities  used  in  interstate  communications,    whereas  information  services  may  be  provided,  more  broadly,  via  telecommunications.    53 
 The  Commission  has  never  required  or  even  suggested  that  the  information  service  provider  must  be  the  entity  that  provides  or  offers  the  telecommunications  over  which  the  information 
 service  is  made  available  to  its  members.  54  As  described  above,  FWD  members  must  separately  acquire  broadband  service,  as  Pulver  does  not  offer  transmission  to  its  members. 


 B.  Commission  Jurisdiction  over  FWD 
 15.  Having  directly  addressed  the  issues  raised  by  Pulvers  petition,  we  believe  it  is  necessary  to  clarify  the  extent  and  nature  of  the  Commissions  jurisdiction  over  FWD,  an 


 Internet  application,  which,  among  other  things,  facilitates  consumers  ability  to  make  VoIP  calls,  but  does  not  directly  offer  such  VoIP  services  to  subscribers.  We  answer  the  statutory 
 questions  raised  by  the  petition  to  establish  the  Commissions  jurisdiction  in  this  area  and  to  avoid  speculation  as  to  the  nature  of  Commission  policy  in  this  area.  Thus,  while  we  plan  to 
 examine  jurisdictional  questions  more  broadly  in  our  IP-  Enabled  Services  Notice  of  Proposed  Rulemaking,  we  best  serve  the  public  by  being  clear  as  to  the  nature  of  our  authority  over  the 
 specific  service  at  issue  in  this  petition.  We  determine,  consistent  with  our  precedent  regarding  information  services,  that  FWD  is  an  unregulated  information  service  and  any  state  regulations 
 that  seek  to  treat  FWD  as  a  telecommunications  service  or  otherwise  subject  it  to  public-  utility  type  regulation  would  almost  certainly  pose  a  conflict  with  our  policy  of  nonregulation.  55 


 16.  As  discussed  more  fully  below,  two  separate  lines  of  reasoning  compel  this  determination.  First,  federal  authority  has  already  been  recognized  as  preeminent  in  the  area  of 


 10 
 52  See  Pulver  Dec.  11  Ex  Parte  Letter  at  3  (acknowledging  that  there  is  some  transmission  involved  in  the 
 provision  of  FWD). 
 53  See  Non-  Accounting  Safeguards  Order,  11  FCC  Rcd  at  21956,  para.  103. 


 54  While  we  do  not  rely  on  the  framework  outlined  by  the  Commission  in  its  1998  Report  to  Congress,  we  note 
 that  the  conclusion  we  reach  here  that  FWD  is  an  information  service  is  consistent  with  the  framework  discussed  by  the  Commission  in  that  report  for  two  reasons:  (1)  to  the  extent  FWD  service  is  carried  out  entirely  over  the 


 Internet  using  computer-  based  software,  this  resembles  what  that  report  characterized  as  computer-  to-  computer  VoIP  and,  as  contemplated  therein,  would  be  considered  an  information  service;  and  (2)  FWD  fails  the  four-  prong 
 test  for  determining  whether  it  is  a  phone-  to-  phone  service,  specifically,  because  it  does  not  use  NANP  numbers  and  does  not  use  the  same  CPE  as  may  be  used  for  circuit-  switched  calls  (rather  it  uses  dedicated  SIP  phones  or  soft 
 phones).  See  Federal-  State  Joint  Board  on  Universal  Service,  CC  Docket  No.  96-  45,  Report  to  Congress,  13  FCC  Rcd  11501,  11520,  para.  39  (1998)  (Stevens  Report). 


 55  We  note  that  this  conclusion  is  confined  to  the  FWD  service  as  described  in  this  Order.  See  supra  note  3. 
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 Federal  Communications  Commission  FCC  04-  27 
 information  services,  and  particularly  in  the  area  of  the  Internet  and  other  interactive  computer  services,  which  Congress  has  explicitly  stated  should  remain  free  of  regulation.  56  In  reaching 
 this  conclusion,  we  note  that  the  Commissions  traditional  test  for  determining  the  boundaries  of  interstate  versus  intrastate  jurisdiction    the  end-  to-  end  analysis    is  inapplicable  in  the  context 
 of  FWD  and,  even  if  it  were  applicable,  would  not  support  a  finding  of  intrastate  jurisdiction.  57  Second,  state-  by-  state  regulation  of  a  wholly  Internet-  based  service  is  inconsistent  with  the 
 controlling  federal  role  over  interstate  commerce  required  by  the  Constitution.  58 


 11 
 17.  Asserting  federal  jurisdiction  over  FWD  is  consistent  with    and  supported  by    the  states  already-  limited  role  with  regard  to  information  services.  The  Commission  has,  on 
 prior  occasions,  determined  that  certain  state  regulations  of  information  services  would  conflict  with  the  national  policy  of  nonregulation.  59  Several  decades  ago,  the  Commission  recognized  in 
 its  Computer  Inquiry  proceeding  60  that  enhanced  services  would  continue  to  develop  best  in  an 
 56  See  47  U.  S.  C.    230;  see  also  infra  para.  18.  In  section  230(  e)(  2)  Congress  defines  interactive  computer 
 service  as  any  information  service,  system,  or  access  software  provider  that  provides  or  enables  computer  access  by  multiple  users  to  a  computer  server.  47  U.  S.  C.    230(  e)(  2)  (emphasis  added). 


 57  See  47  U.  S.  C.    153(  22)  (defining  interstate  communication).  In  section  2(  a)  of  the  Act,  Congress  has  given 
 the  Commission  exclusive  jurisdiction  over  interstate  communications.  47  U.  S.  C.    152(  a).  Section  2(  b)  of  the  Act  reserves  to  the  states  jurisdiction  over  intrastate  services.  See  47  U.  S.  C.    152(  b);  see  infra  note  81. 


 58  See  infra  paras.  23-  25  (discussing  the  applicability  of  the  Commerce  Clause). 
 59  California  v.  FCC,  39  F.  3d  919,  931  (9  th  Cir.  1994)  (When  state  regulations  would  negate  national  policy,  the 
 Commission  may  preempt  state  regulations.). 
 60  The  Commission  launched  its  Computer  Inquiry  proceedings  more  than  30  years  ago.  See  Regulatory  and 
 Policy  Problems  Presented  by  the  Interdependence  of  Computer  and  Communication  Services  and  Facilities,  Docket  No.  16979,  Notice  of  Inquiry,  7  FCC  2d  11  (1966)  (Computer  I  NOI);  Regulatory  and  Policy  Problems 


 Presented  by  the  Interdependence  of  Computer  and  Communication  Services  and  Facilities,  Docket  No.  16979,  Final  Decision  and  Order,  28  FCC  2d  267  (1971)  (Computer  I  Final  Decision);  Amendment  of  Section  64.702  of  the 
 Commission's  Rules  and  Regulations  (Second  Computer  Inquiry),  Docket  No.  20828,  Tentative  Decision  and  Further  Notice  of  Inquiry  and  Rulemaking,  72  FCC  2d  358  (1979)  (Computer  II  Tentative  Decision);  Computer  II 
 Final  Decision,  77  FCC  2d  384  (1980);  Amendment  of  Section  64.702  of  the  Commission's  Rules  and  Regulations  (Third  Computer  Inquiry),  CC  Docket  No.  85-  229,  Report  and  Order,  104  FCC  2d  958  (1986)  (Computer  III) 
 (subsequent  cites  omitted)  (collectively  the  Computer  Inquiry).  In  its  Second  Computer  Inquiry  proceeding,  the  Commission  adopted  a  regulatory  scheme  that  distinguished  between  the  common  carriage  offering  of  basic 
 transmission  services  and  the  offering  of  enhanced  services.  Computer  II  Final  Decision,  77  FCC  2d  at  387;  Computer  III  Further  Remand  Proceedings:  Bell  Operating  Company  Provision  of  Enhanced  Services;  1998 
 Biennial  Regulatory  Review    Review  of  Computer  III  and  ONA  Safeguards  and  Requirements,  13  FCC  Rcd  6040,  6064,  para.  38  (1998).  The  former  services  are  regulated  under  Title  II  and  the  latter  services  are  not.  See 
 Computer  II  Final  Decision,  77  FCC  2d  at  428-  30,  432-  43  (indicating  it  would  not  serve  the  public  interest  to  subject  enhanced  service  providers  to  traditional  common  carrier  regulation  under  Title  II  because,  among  other 
 things,  the  enhanced  services  market  was  truly  competitive).  Although  the  1996  Act  uses  different  terminology  (i.  e.,  telecommunications  services  and  information  services)  than  used  by  the  Commission  in  its  Computer 
 Inquiry  proceeding,  the  Commission  has  determined  that  enhanced  services  and  information  services  should  be  interpreted  to  extend  to  the  same  functions,  although  the  definition  in  1996  Act  is  even  broader.  See  Non-Accounting 
 Safeguards  Order,  11  FCC  Rcd  at  21955-  56,  para.  102  (explaining  that  all  enhanced  services  are  information  services,  but  information  services  are  broader  and  may  not  be  enhanced  services). 
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 Federal  Communications  Commission  FCC  04-  27 
 unregulated  environment  and,  given  the  competitive  nature  of  the  market,  regulation  of  enhanced  services  was  thus  unwarranted.  61  For  example,  in  adopting  non-  structural  requirements  for  the 
 Bell  operating  company  provision  of  enhanced  services,  the  Commission  recognized  that  certain  state  requirements  affecting  the  intrastate  portion  of  jurisdictionally  mixed  enhanced  services 
 would  thwart  Commission  objectives  and  thus  were  not  permitted.  62  Indeed,  in  those  instances  where  the  states  have  attempted  to  assert  jurisdiction,  this  Commission  has  been  affirmed  in 
 asserting  its  national  policy  of  nonregulation.  63  Consequently,  states  have  generally  played  a  very  limited  role  with  regard  to  information  services.  We  see  no  reason  to  depart  from  this 
 precedent  here. 
 18.  Passage  of  the  1996  Act  increases  substantially  the  likelihood  that  any  state  attempt  to  impose  economic  regulation  of  FWD  would  conflict  with  federal  policy.  64  In  section 


 12  (continued.) 
 61  Computer  II  Final  Decision,  77  FCC  2d  at  433,  paras.  127-  28  ([  W]  e  believe  the  market  for  these  [enhanced] 
 services  will  continue  to  burgeon  and  flourish  best  in  the  existing  competitive  environment)  (further  citations  omitted);  see  Amendment  of  Section  64.702  of  the  Commission's  Rules  and  Regulations  (Second  Computer  Inquiry), 


 Docket  No.  20828,  88  FCC  2d  512,  541,  para.  83  n.  34  (Computer  II  Further  Reconsideration  Order)  (  we  have  determined  that  the  provision  of  enhanced  services  is  not  a  common  carrier  public  utility  offering  and  that  the 
 efficient  utilization  and  full  exploitation  of  the  interstate  telecommunications  network  would  best  be  achieved  if  these  services  are  free  from  public  utility-  type  regulation.).  Indeed,  the  Commission  said  that  states  may  not 
 impose  common  carrier  tariff  regulation  on  a  carriers  provision  of  enhanced  services,  id.,  and  such  state  regulation  of  entry  and  service  terms  and  conditions  (including  rates  and  features  availability)  ostensibly  applied  to 
 intrastate  enhanced  services  would  have  a  severe  impact  on  federal  open  entry  policies.  Amendment  of  Section  64.702  of  the  Commission's  Rules  and  Regulations  (Third  Computer  Inquiry),  CC  Docket  No.  85-  229, 
 Memorandum  Opinion  and  Order  on  Reconsideration,  2  FCC  Rcd  3035,  3070,  n.  374.  (1987)  (Computer  III  Phase  I  Recon).  The  precise  contours  of  these  state  limitations  were  the  subject  of  continued  litigation.  See  Computer  and 
 Communications  Industry  Assn  v.  FCC,  693  F.  2d  198,  204  (D.  C.  Cir.  1982)  (on  appeal  of  Computer  II  the  court  explicitly  noted  the  Commissions  preemption  of  any  state  regulation  of  enhanced  services,  affirming  Computer  II 
 in  its  entirety);  id.  at  205-  06  nn.  26-  28;  California  v.  FCC,  905  F.  2d  1217,  1239-  1242  (9  th  Cir.  1990)  (California  I)  (vacating  Computer  III  preemption  of  all  state  regulation  of  enhanced  services  due  to  Commissions  failure  to 
 consider  the  possibility  of  purely  intrastate  enhanced  services  and  what  effect  state  regulation  may  have  on  valid  Commission  goals);  but  see  California  v.  FCC,  39  F.  3d  919  (9  th  Cir.  1994)  (affirming  Commission  preemption  of 
 state  requirements  for  structural  separation  of  facilities  and  personnel  used  to  provide  the  intrastate  portion  of  jurisdictionally  mixed  enhanced  services,  and  state  regulations  regarding  CPNI  and  network  disclosure  rules).  The 
 Commission  has  stated  that  it  has  exclusive  jurisdiction  to  regulate  enhanced  services  where  it  is  not  possible  to  separate  out  the  interstate  and  intrastate  components  and  state  regulations  would  negate  valid  Commission 
 regulatory  goals.  See  Policy  and  Rules  Concerning  the  Interstate  Interexchange  Marketplace,  CC  Docket  No.  96-  6,  Further  Notice  of  Proposed  Rulemaking,  13  FCC  Rcd  21531,  21553  (1998)  (citing  California  III). 


 62  See  Computer  III  Remand  Proceedings:  Bell  Operating  Company  Safeguards  and  Tier  1  Local  Exchange 
 Company  Safeguards,  6  FCC  Rcd  7571,  7632,  paras.  122-  24  (BOC  Safeguards  Order)  (preempting  state  requirements  for  separation  of  facilities  and  personnel  in  the  provision  of  jurisdictionally  mixed  enhanced  services); 


 see  also  note  81  infra  (discussing  the  Commissions  mixed  use  standard  to  determine  jurisdiction). 
 63  See  California  III,  39  F.  3d  932;  see  also  Petition  For  Emergency  Relief  And  Declaratory  Ruling  Filed  By  The 
 BellSouth  Corporation,  7  FCC  Rcd  1619,  1620,  para.  7  (BellSouth  MemoryCall)  (preempting  order  of  the  state  public  utility  commission  because  of  its  impact  on  a  BellSouth  jurisdictionally  mixed  information  service). 


 64  See  MCI  Dec.  12  Ex  Parte  Letter  at  3  n.  8  (quoting  AT&  T  v.  Iowa  Utils.  Bd.,  525  U.  S.  366,  377-  80  &  n.  6  (1999) 
 ([  T]  he  question  in  these  cases  is  not  whether  the  Federal  Government  has  taken  the  regulation  of  local 
12
 Federal  Communications  Commission  FCC  04-  27 
 230  of  the  1996  Act,  Congress  expressed  its  clear  preference  for  a  national  policy  to  preserve  the  vibrant  and  competitive  free  market  that  presently  exists  for  the  Internet  and  other  interactive 
 computer  services  unfettered  by  Federal  or  State  regulation.  65  Courts  have  repeatedly  recognized  this  congressional  intent  and,  as  a  result,  have  rejected  state  attempts  to  regulate  such 
 services.  66  In  addition,  in  section  706  of  the  1996  Act  Congress  required  the  Commission  to  encourage  deployment  of  advanced  telecommunications  capability  to  all  Americans  by  using 
 measures  that  promote  competition  in  the  local  telecommunications  market.  67  We  recognize  that  most  states  have  not  acted  to  produce  an  outright  conflict  between  federal  and  state  law  that 
 justifies  Commission  preemption,  68  but  nevertheless  confirm  that  the  Commission  does  have  the  authority  to  act  in  this  area  if  states  promulgate  regulations  applicable  to  FWDs  service  that  are 
 inconsistent  with  its  current  nonregulated  status. 
 19.  We  find  that  granting  Pulvers  petition  and  declaring  FWD  to  be  an  unregulated  information  service  subject  to  Commission  jurisdiction  will  facilitate  the  further  development  of 


 FWD  and  Internet  applications  like  it  and  these  offerings,  in  turn,  will  encourage  more  consumers  to  demand  broadband  service.  69  Ensuring  that  FWD,  as  it  is  currently  offered, 


 13 
 (Continued  from  previous  page) 
 (continued.) 
 telecommunications  competition  away  from  the  States.  With  regard  to  the  matters  addressed  by  the  1996  Act,  it  unquestionably  has.)).  As  noted  previously  by  the  Commission,  through  its  1996  Act,  Congress  codified  the 
 distinction  that  the  Commission  made  between  basic  services  and  enhanced  services  (as  telecommunications  services  and  information  services).  See  Non-  Accounting  Safeguards  Order,  11  FCC  Rcd  at  21955-  56,  para.  102. 
 By  not  including  information  services  within  the  ambit  of  Title  II,  Congress  expressed  a  preference  that  information  services  not  be  regulated.  Although  the  Commission  has  clear  authority  to  do  so,  it  has  only  rarely  sought  to 
 regulate  information  services  using  its  Title  I  ancillary  authority.  See  Section  255  Order,  16  FCC  Rcd  at  6457. 
 65  See  47  U.  S.  C.    230(  b)(  2). 


 66  See,  e.  g.,  Vonage  Holdings  Co.  v.  Minnesota  Pub.  Utils.  Commn,  290  F.  Supp.  2d  993,  997,  1001-  02  (D. 
 Minn.  2003);  Southwestern  Bell  Tel.  Co.  v.  FCC,  153  F.  3d  523,  544  (8  th  Cir.  1998);  Zeran  v.  America  Online,  Inc.,  129  F.  3d  327,  330  (4  th  Cir.  1997). 


 67  47  U.  S.  C.    157  nt.  Section  706  of  the  1996  Act  is  located  in  the  notes  of  section  7  and  we  note  that  section  7, 
 itself,  clearly  explains  that  it  is  the  policy  of  the  United  States  to  encourage  the  provision  of  new  technologies  and  services  to  the  public.  To  implement  this  mandate,  the  Commission  has  considered,  among  other  things,  whether  its 


 rules  promote  the  delivery  of  innovative  advanced  services  offerings.  See  Review  of  the  Section  251  Unbundling  Obligations  of  Incumbent  Local  Exchange  Carriers,  Implementation  of  the  Local  Competition  Provisions  of  the 
 Telecommunications  Act  of  1996,  Deployment  of  Wireline  Services  Offering  Advanced  Telecommunications  Capability,  CC  Docket  Nos.  01-  338,  96-  98,  98-  147,  Report  and  Order  and  Order  on  Remand  and  Further  Notice  of 
 Proposed  Rulemaking,  18  FCC  Rcd  16978,  17125-  26,  para.  242  (2003)  (Triennial  Review  Order),  corrected  by  Errata,  18  FCC  Rcd  19020  (2003)  (Triennial  Review  Order  Errata),  petitions  for  review  pending,  United  States 
 Telecom  Assn  v.  FCC,  D.  C.  Cir.  No.  00-  1012  (and  consolidated  cases).  We  find  that  our  actions  in  this  ruling  are  also  consistent  with  this  provision  of  the  Act. 


 68  See  Vonage  Holdings  Corporation  Petition  for  Declaratory  Ruling  Concerning  an  Order  of  the  Minnesota 
 Public  Utilities  Commission,  WC  Docket  No.  03-  211  (filed  Sept.  22,  2003). 
 69  As  noted  above,  Congress  has  clearly  indicated  that  information  services  are  not  subject  to  the  economic  and 
 entry/  exit  regulation  inherent  in  Title  II.  In  so  doing,  however,  Congress  has  provided  the  Commission  with  ancillary  authority  under  Title  I  to  impose  such  regulations  as  may  be  necessary  to  carry  out  its  other  mandates 


 under  the  Act.  We  expressly  decline  to  exercise  Title  I  jurisdiction  over  FWD  to  impose  any  economic  or  entry/  exit 
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 Federal  Communications  Commission  FCC  04-  27 
 remains  unregulated  by  the  Commission  or  the  states  is  thus  consistent  with  the  requirements  of  the  Act.  70  To  rule  otherwise  would  effectively  apply  a  regulatory  paradigm  that  was  previously 
 developed  for  different  types  of  services,  which  were  provided  over  a  vastly  different  type  of  network.  Indeed,  we  would  risk  eliminating  an  innovative  service  offering  that,  as  noted  by 
 Pulver,  promotes  consumer  choice,  technological  development  and  the  growth  of  the  Internet,  and  universal  service  objectives.  71  For  reasons  provided  herein,  that  FWD  happens  to,  among 
 other  things,  enable  members  to  talk  over  the  Internet,  as  opposed  to  play  video  games,  for  example,  does  not  affect  our  conclusion  that  FWD  is  most  appropriately  characterized  as  an 
 unregulated  information  service. 
 20.  Unless  an  information  service  can  be  characterized  as  purely  intrastate,  72  or  it  is  practically  and  economically  possible  to  separate  interstate  and  intrastate  components  of  a 


 jurisdictionally  mixed  information  service  without  negating  federal  objectives  for  the  interstate  component,  exclusive  Commission  jurisdiction  has  prevailed.  73  FWD  clearly  can  not 
 appropriately  be  characterized  as  a  purely  intrastate  information  service.  FWDs  members  currently  reside  in  over  170  countries  around  the  world,  with  less  than  33%  of  those  members 
 indicating  their  country  of  residence  as  the  United  States.  74  Of  those  members  based  in  the  United  States,  all  50  states  are  identified  as  member  locations.  75  Because  FWD  facilitates  its 
 members  ability  to  contact  any  of  its  other  members  worldwide,  to  communicate  with  more  than  one  at  any  given  time,  and  because  these  members  physical  locations  can  continually  change,  it 
 is  evident  that  the  capabilities  FWD  provides  its  members  are  not  purely  intrastate  capabilities.  Moreover,  it  would  be  impractical  to  determine  whether  there  was  any  intrastate  component  to 
 FWD  given  the  fact  that  FWDs  information  service  as  provided  to  its  members  occurs  solely  within  the  confines  of  the  Internet. 


 14 
 (Continued  from  previous  page)  regulation.  Such  regulation  would  not  only  run  counter  to  our  decades  old  goals  and  objectives  to  enable 
 information  services  to  function  in  a  freely  competitive,  unregulated  environment,  but  would  directly  contravene  Congresss  express  directives  in  sections  706  and  230  of  the  Act  that  services  such  as  FWD  not  be  subject  to  such 
 regulation.  Moreover,  we  decline  to  impose  any  other  type  of  regulation  on  Pulvers  FWD  information  service  at  this  time. 


 70  Any  state  attempt  to  impose  economic  or  other  regulations  that  treat  FWD  like  a  telecommunications  service 
 would  impermissibly  interfere  with  the  Commissions  valid  federal  interest  in  encouraging  the  further  development  of  Internet  applications  such  as  these,  unfettered  by  Federal  or  state  regulation,  and  thus  would  be  preempted. 


 71  Pulver  Reply  at  6. 
 72  See  California  v.  FCC,  905  F.  2d  1217  (1990).  We  recognize  that  states  theoretically  could  have  a  role  in 
 regulating  a  purely  intrastate  information  service,  but  we  doubt  that,  with  the  particular  service  at  issue  here,  any  state  could  claim  FWD  to  be  purely  intrastate. 


 73  See  supra  para.  17. 
 74  See  Pulver  Jan.  15  Ex  Parte  Letter,  Attach.  at  3-  4;  Pulver  Jan.  20  Ex  Parte  Letter  at  1  (indicating  there  are 
 currently  about  141,000  registered  FWD  members,  approximately  45,000  of  which  identify  themselves  with  an  address  in  the  United  States). 


 75  See  Pulver  Jan.  20  Ex  Parte  Letter  at  1. 
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 Federal  Communications  Commission  FCC  04-  27 
 21.  Indeed,  these  characteristics  of  FWD  render  our  normal  approach  to  determining  jurisdiction  the  end-  to-  end  analysis  unhelpful.  Traditionally,  the  Commission  has  applied  its 
 so-  called  end-  to-  end  analysis,  looking  at  the  end  points  of  a  communication,  to  determine  the  jurisdictional  nature  of  any  given  service.  76  Briefly,  the  Commission  considers  the  continuous 
 path  of  communications,  beginning  with  the  inception  of  a  call  to  its  completion,  and  has  rejected  attempts  to  divide  communications  at  any  intermediate  points  between  providers.  77 
 While  our  traditional  end-  to-  end  approach  to  determining  a  communications  jurisdiction  has  relevance  for  a  circuit-  switched  network,  it  has  little  or  none  with  regard  to  FWD.  Indeed,  in  the 
 case  of  FWD  the  concept  of  end  points  has  little  relevance.  What  Pulver  provides  is  information  on  its  server  located  on  the  Internet.  78  If  an  FWD  member  uses  that  information  to 
 set  up  communications,  such  as  voice,  between  itself  and  other  members,  that  communication  the  only  conceivable  end  points  involved  here  is  transmitted  by  that  members  ISP  over  the 
 Internet.  That  does  not,  however,  impute  those  end  points  to  FWD,  which  remains  a  server  on  the  Internet.  Furthermore,  even  if  the  members  locations  were  somehow  relevant  to  their  use  of 
 FWD,  FWDs  portable  nature  without  fixed  geographic  origination  or  termination  points  means  that  no  one  but  the  members  themselves  know  where  the  end  points  are.  79  Attempting  to  require 
 Pulver  to  locate  its  members  for  the  purpose  of  adhering  to  a  regulatory  analysis  that  served  another  network  would  be  forcing  changes  on  this  service  for  the  sake  of  regulation  itself,  rather 
 than  for  any  particular  policy  purpose.  The  Act  counsels  against  it,  80  and  we  decline  to  do  it.  Finally,  we  are  not  aware  that  the  Commission  has  ever  applied  an  end-  to-  end-  analysis  for 


 15 
 76  See,  e.  g.,  Bell  Atlantic  Tel.  Cos.  v.  FCC,  206  F.  3d  1,  3  (D.  C.  Cir.  2000). 
 77  See,  e.  g.,  BellSouth  Memory  Call,  7  FCC  Rcd  at  1620;  Teleconnect  Company  v.  Bell  Telephone  Company  of 
 Penn.,  10  FCC  Rcd  1626,  1629  (1995);  GTE  ADSL  Order,  13  FCC  Rcd  at  22466,  22475-  78,  paras.  17-  21.  In  the  GTE  ADSL  Order,  the  Commission  disagreed  that  an  end-  to-  end  ADSL  communication  must  be  separated  into  two 


 components    an  intrastate  telecommunications  service  (provided  in  this  instance  by  GTE)  and  an  interstate  information  service  (provided  by  an  ISP).  GTE  ADSL  Order,  13  FCC  Rcd  at  22477-  78,  para.  20. 


 78  In  the  GTE  ADSL  Order,  the  Commission  identified  the  practical  difficulties  of  applying  its  end-  to-  end  analysis 
 to  Internet  communications  by  noting  that  such  communications  do  not  necessarily  have  an  identifiable  point  of  termination,  in  the  traditional  sense,  for  jurisdictional  purposes.  GTE  ADSL  Order,  13  FCC  Rcd  at  22479,  para. 


 22.  In  a  more  recent  context,  the  Commission  similarly  found  it  difficult  to  pinpoint  the  origination  of  a  communication  arising  over  the  Internet.  Provision  of  Improved  Telecommunications  Relay  Services  and  Speech-to- 
 Speech  Services  for  Individuals  with  Hearing  and  Speech  Disabilities,  CC  Docket  No.  98-  97,  Declaratory  Ruling  and  Second  Further  Notice  of  Proposed  Rulemaking,  17  FCC  7779,  7784,  para.  15  (2002)  (Because  the  first  leg  of 
 an  IP  Relay  call  comes  over  the  Internet,  rather  than  from  a  telephone,  there  is  no  automatic  way  to  determine  whether  any  call  is  intrastate  or  interstate.  This  is  because  Internet  addresses  do  not  have  geographic  correlates,  and 
 there  is  currently  no  Internet  address  identifier  that  can  automatically  give  the  location  of  the  caller.).  In  the  FNPRM  in  that  proceeding,  the  Commission  tentatively  proposed  to  use  an  end-  to-  end  analysis  to  define  whether  an 
 IP  Relay  call  is  interstate  or  intrastate  for  the  limited  purpose  of  determining  a  statutorily  mandated  cost  allocation.  Id.  at  7792,  para.  42;  see  also  47  U.  S.  C.    225(  d)(  3)(  B).  That  proceeding  is  still  pending.  Furthermore,  unlike  the 
 FWD  communications  addressed  in  this  Order,  the  IP  Relay  call  does  not  both  begin  and  end  in  the  Internet. 
 79  See  Pulver  Dec.  16  Ex  Parte  Letter  at  1-  2. 


 80  See  supra  para.  18. 
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 Federal  Communications  Commission  FCC  04-  27 
 determining  the  jurisdiction  of  a  particular  service  where  the  service  provider  was  not  itself  providing  some  aspect  of  the  users  underlying  transmission  capability. 
 22.  We  find  that  even  if  some  form  of  an  end-  to-  end  analysis  were  deemed  applicable  to  FWD,  FWD  would  be  considered  an  interstate  information  service  in  accordance  with  our 
 mixed  use  doctrine.  81  Where  separating  interstate  traffic  from  intrastate  traffic  is  impossible  or  impractical,  the  Commission  has  declared  such  traffic  to  be  interstate  in  nature.  82  Based  on  the 
 record  in  this  proceeding,  it  is  evident  that  it  is  impossible  or  impractical  to  attempt  to  separate  FWD  into  interstate  and  intrastate  components.  83  This  impossibility  results  from  the  global 
 portability  feature  of  an  FWD  members  unique  identification  number,  enabling  that  member  to  initiate  and  receive  on-  line  communications  from  anywhere  in  the  world  where  it  can  access  the 
 Internet  via  a  broadband  connection.  84  Moreover,  FWDs  technology  does  not  enable  Pulver  to  determine  the  actual  physical  location  of  an  underlying  IP  address.  85  Finally,  it  is  evident  that 
 more  than  a  de  minimus  amount  of  FWDs  offering  is  interstate.  86  Therefore,  we  would  analogize  the  FWD  offering  to  those  previously  deemed  exclusively  interstate  by  the 
 Commission  where  it  has  applied  its  mixed  use  rule.  87 
 23.  Finally,  our  conclusions  today  also  are  consistent  with  the  Commerce  Clause,  which  denies  the  States  the  power  unjustifiably  to  discriminate  against  or  burden  the  interstate 


 flow  of  articles  of  commerce.  88  The  nature  of  FWD  as  an  Internet  application  not  bound  by  geography  may  well  render  an  attempt  by  a  state  to  regulate  any  theoretical  intrastate  FWD 
 component  an  impermissible  extraterritorial  reach.  89  In  other  words,  as  we  have  noted  above,  FWD  itself  is  merely  an  Internet  application  available  on  Pulvers  server,  which  members 


 16 
 81  See  MTS  and  WATS  Market  Structure,  Amendment  of  Part  36  of  the  Commissions  Rules  and  Establishment  of 
 a  Joint  Board,  CC  Docket  Nos.  78-  72,  80-  286,  Decision  and  Order,  4  FCC  Rcd  5660,  n.  7  (1989)  (MTS/  WATS  Market  Structure  Separations  Order)  (the  Commission  found  that  mixed  use  special  access  lines  carrying  more 


 than  a  de  minimis  amount  of  interstate  traffic  to  private  line  systems  are  subject  to  the  Commissions  jurisdiction  because  traffic  on  many  such  lines  could  not  be  measured  without  significant  additional  administrative  efforts). 


 82  Id. 
 83  See,  e.  g.,  MCI  Dec.  12  Ex  Parte  Letter  at  1;  Cisco  Dec.  11  Ex  Parte  Letter  at  5;  Level  3  Dec.  16  Ex  Parte  Letter 
 at  2;  Verizon  Feb.  5  Ex  Parte  Letter  at  2. 
 84  See  Pulver  Dec.  16  Ex  Parte  Letter  at  1-  2. 


 85  Id. 
 86  See  supra  para.  20. 
 87  See,  e.  g.,  Cisco  Dec.  11  Ex  Parte  Letter  at  4-  5;  Vonage  Dec.  10  Ex  Parte  Letter  at  3-  4. 
 88  U.  S.  Const.  art.  1,    8,  cl.  3;  see  also  Oregon  Waste  Sys.  v.  Dept  of  Envtl.  Quality,  511  U.  S.  93,  98  (1994). 
 89  See  Cotto  Waxo  Co.  v.  Williams,  46  F.  3d  790,  793  (8  th  Cir.  1995)  (  Under  the  Commerce  Clause,  a  state 
 regulation  is  per  se  invalid  when  it  has  an  extraterritorial  reach,    that  is,  when  the  statute  has  the  practical  effect  of  controlling  conduct  beyond  the  boundaries  of  the  state.  The  Commerce  Clause  precludes  application  of  a  state 


 statute  to  commerce  that  takes  place  wholly  outside  of  the  states  borders.)  (citation  omitted). 
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 Federal  Communications  Commission  FCC  04-  27 
 anywhere  reach  via  the  Internet.  FWD  members  reaching  Pulvers  server  to  initiate  a  communication  may  be  located  anywhere  in  the  world  where  an  Internet  connection  is  available 
 to  them.  Because  of  the  way  FWD  is  offered,  one  states  regulation  of  FWD  may  have  the  practical  effect  of  requiring  those  same  regulations  to  be  applied  to  FWD  service  for  all  users. 


 24.  Moreover,  even  where  state  regulation  is  not  a  per  se  violation  of  the  Commerce  Clause,  courts  have  inquired  whether  the  burden  imposed  on  interstate  commerce  by  state 
 regulation  would  be  clearly  excessive  in  relation  to  the  putative  local  benefits.  90  This  may  well  be  the  case  with  respect  to  FWD.  As  an  initial  matter,  we  cannot  envision  how  state  economic 
 regulation  of  the  FWD  service  described  in  this  proceeding  could  benefit  the  public.  In  contrast,  however,  the  burdens  upon  interstate  commerce  would  be  significant.  Even  if  it  were  relevant 
 and  possible  to  track  the  geographic  location  of  packets  and  isolate  traffic  for  the  purpose  of  ascertaining  state  jurisdiction  over  a  theoretical  intrastate  component  of  an  otherwise  integrated 
 bit  stream,  such  efforts  would  be  impractical.  Tracking  FWDs  packets  to  determine  their  geographic  location  would  involve  the  installation  of  systems  that  are  unrelated  to  providing  its 
 service  to  end  users.  Rather,  imposing  such  compliance  costs  on  providers  such  as  Pulver  would  be  designed  simply  to  comply  with  legacy  distinctions  between  the  federal  and  state 
 jurisdictions.  Here,  such  distinctions  do  not  appear  to  serve  any  legitimate  public  policy  purpose.  Investment  in  such  systems  would  improve  neither  service  nor  efficiency.  In  a 
 dynamic  market  such  as  the  market  for  Internet  applications  like  FWD,  we  find  that  imposing  this  substantial  burden  would  make  little  sense  and  would  almost  certainly  be  significant  and 
 negative  for  the  development  of  new  and  innovative  IP  services  and  applications. 
 25.  Furthermore,  if  Pulver  were  subject  to  state  regulation,  it  would  have  to  satisfy  the  requirements  of  more  than  50  state  and  other  jurisdictions  with  more  than  50  different 


 certification,  tariffing  and  other  regulatory  obligations.  State  regulation  of  FWD  would  make  FWD  unique  among  Internet  applications  as  the  only  Internet  application  to  be  subject  to  such 
 state  obligations.  Indeed,  allowing  the  imposition  of  state  regulation  would  eliminate  any  benefit  of  using  the  Internet  to  provide  the  service:  the  Internet  enables  individuals  and  small  providers, 
 such  as  Pulver,  to  reach  a  global  market  simply  by  attaching  a  server  to  the  Internet;  requiring  Pulver  to  submit  to  more  than  50  different  regulatory  regimes  as  soon  as  it  did  so  would 
 eliminate  this  fundamental  advantage  of  IP-  based  communication.  Certainly,  it  is  this  kind  of  impact  Congress  considered  when  it  made  clear  statements  about  leaving  the  Internet  and 
 interactive  computer  services  free  of  unnecessary  federal  and  state  regulation  noted  above.  91 


 17  (continued.) 
 90  See  Pike  v.  Bruce  Church,  Inc.,  397  U.  S.  137,  142  (1970);  see  also  Cotto  Waxo  Co.  at  793  ([  I]  f  the  challenged 
 statute  regulates  evenhandedly,  then  it  burdens  interstate  commerce  indirectly  and  is  subject  to  a  balancing  test.  Under  the  balancing  test,  a  state  statute  violates  the  Commerce  Clause  only  if  the  burdens  it  imposes  on  interstate 


 commerce  are  clearly  excessive  in  relation  to  the  putative  local  benefits.  )  (citation  omitted). 
 91  We  note  the  existence  of  other  network-  based  service  examples  where,  although  an  intrastate  component  of 
 such  service  may  exist,  this  intrastate  component  must  nonetheless  yield  to  exclusive  federal  jurisdiction  in  the  area  of  economic  or  other  state  regulations  affecting  entry  to  advance  articulated  congressional  or  federal  deregulatory 


 objectives.  See,  e.  g.,  49  U.  S.  C.  A.    14501  (preempting  state  economic  regulation  of  motor  carriers);  Carsten  v.  United  Parcel  Service,  Inc.,  1996  WL  335421(  E.  D.  Cal.  1996)  (holding  that  section  14501(  c)(  1)  clearly  reaffirms 
 Congresss  intent  to  preempt  state  laws  relating  to  the  prices  of  motor  carriers);  47  U.  S.  C.    332(  c)(  A)  (preempting 
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 Federal  Communications  Commission  FCC  04-  27 
 IV.  CONCLUSION 
 26.  For  the  reasons  set  forth  above,  we  declare  FWD  to  be  neither  telecommunications  nor  a  telecommunications  service.  Furthermore,  we  declare  FWD  to  be 


 an  unregulated  information  service  subject  to  the  Commissions  jurisdiction. 


 V.  ORDERING  CLAUSE 
 27.  Accordingly,  IT  IS  ORDERED,  pursuant  to  sections  1,  2,  3,  4(  i)  and  303(  r)  of  the  Communications  Act  of  1934,  as  amended,  47  U.  S.  C.  ,  151,  152,  153,  154(  i),  303(  r)  and 


 section  1.2  of  the  Commission's  rules,  47  C.  F.  R.    1.2,  that  pulver.  coms  Petition  for  Declaratory  Ruling  IS  GRANTED. 


 FEDERAL  COMMUNICATIONS  COMMISSION 
 Marlene  H.  Dortch  Secretary 


 18 
 (Continued  from  previous  page)  state  regulation  of  entry  or  rates  of  commercial  mobile  radio  service  providers);  New  York  State  Commission  v. 
 FCC,  749  F.  2d  804  (1984)  (preempting  state  and  local  entry  regulation  of  satellite  master  antenna  television.). 
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 Federal  Communications  Commission  FCC  04-  27 
 APPENDIX 
 Commenters  in  WC  Docket  No.  03-  45 


 Commenters  Abbreviation  BellSouth  Corporation  BellSouth 
 Cisco  Systems,  Inc.  Cisco  FBI/  Department  of  Justice  DOJ/  FBI 
 Global  Crossing  North  America,  Inc.  Global  Crossing  International  Softswitch  Consortium  ISC 
 MCI  (f/  k/  a  WorldCom,  Inc.)  MCI  pulver.  com  Pulver 
 Qwest  Communications  International  Inc.  Qwest  SBC  Telecommunications,  Inc.  SBC 
 United  States  Telecom  Association  USTA  Verizon  Verizon 
 Voice  on  the  Net  Coalition  VON  Coalition  Vonage  Vonage 


 Reply  Commenters  Abbreviation  AT&  T  Corp.  AT&  T 
 Cisco  Systems,  Inc.  Cisco  Electronic  Frontier  Foundation  EFF 
 Minnesota  Department  of  Commerce  Minnesota  Dept.  of  Commerce  Michigan  Public  Service  Commission  Michigan  PSC 
 pulver.  com  Pulver  United  States  Telecom  Association  USTA 


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 Federal  Communications  Commission  FCC  04-  27 
 STATEMENT  OF  CHAIRMAN  MICHAEL  K.  POWELL 


 Re:  Petition  for  Declaratory  Ruling  that  pulver.  coms  Free  World  Dialup  is  Neither  Telecommunications  Nor  a  Telecommunications  Service,  WC  Docket  No.  03-  45 


 Today  we  affirm  our  commitment    and  fulfill  our  statutory  obligation    to  keep  the  Internet  free  from  unnecessary  government  regulation.  In  todays  Order,  we  declare  the  Free 
 World  Dialup  (FWD)  offering  of  Pulver.  com  to  be  a  service  subject  to  exclusive  federal  jurisdiction.  Like  email  and  instant  messaging,  FWD  builds  on  consumer  acceptance  of  those 
 services  and  operates  as  a  free,  peer-  to-  peer  application  that  connects  consumers  around  the  corner  and  across  the  globe.  Our  ruling  formalizes  the  Commissions  policy  of  non-  regulation 
 of  the  Internet  and,  in  so  doing,  preserves  the  Internet  as  a  free  and  open  platform  for  innovation.  Just  as  important,  todays  ruling  removes  barriers  to  investment  and  deployment  of  Internet 
 applications  and  services  by  and  ensuring  that  Internet  applications  remain  insulated  from  unnecessary  and  harmful  economic  regulation  at  both  the  federal  and  state  levels. 


 At  the  outset,  I  would  like  to  acknowledge  the  positive  cooperation  we  have  received  from  the  law  enforcement  community  in  this  and  related  proceedings.  Make  no  mistake,  this 
 item  fully  addresses  law  enforcements  legitimate  interests  in  this  area.  We  have  worked  extensively  with  law  enforcement  and  established  a  process  to  specifically  address  unique  issues 
 associated  with  implementing  the  Communications  Assistance  for  Law  Enforcement  Act  (CALEA)    a  process  that  fully  satisfies  the  Department  of  Justice. 


 There  is  another  related  freedom  at  work  in  this  proceeding    the  freedom  of  consumers  to  increasingly  choose  innovative,  personalized  Internet  applications  and  services.  We  know 
 from  experience  that  IP-  enabled  services  such  as  Pulver.  coms  FWD  offering  can  spur  demand  for  broadband  connections  by  providing  consumers  with  a  feature-  rich  set  of  Internet  voice 
 applications.  We  also  should  be  mindful  that  the  largest  barriers  to  progress  and  the  development  of  this  and  other  services  like  it,  are  conflicting  sets  of  economic  regulations  and 
 onerous  taxes.  While  many  states  have  not  acted  to  produce  an  outright  conflict  between  federal  and  state  law  that  justifies  Commission  preemption,  todays  Order  confirms  that  the  Commission 
 possess  significant  authority  to  act  in  this  area  if  a  conflict  of  law  should  occur.  Whether  state  or  federal  in  origin,  regulation  of  Internet  applications  such  as  FWD  is  not  only  inconsistent  with 
 the  network  architecture  of  the  Internet,  but  also  with  Congresss  directive  to  ensure  the  Internet  remains  free  of  unwarranted  federal  or  state  regulation.  Among  other  provisions,  section  230  of 
 the  1996  Telecommunications  Act  states  Congresss  unambiguous  preference  for  a  national  policy  to  preserve  the  vibrant  and  competitive  free  market  that  presently  exists  for  the  Internet 
 and  other  interactive  computer  services  []  unfettered  by  Federal  or  State  regulation.  92  Today,  we  give  some  substance  to  this  statutory  command. 


 20 
 92  See  47  U.  S.  C.    230(  b)(  2). 
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 Federal  Communications  Commission  FCC  04-  27 
 We  should  all  work  to  implement  Congresss  clear  preference  for  a  vibrant  free  market  in  Internet  applications.  In  this  sense,  FWD  is  really  only  the  beginning.  As  we  embark  on  the 
 next  phase  of  the  digital  migration,  our  end  goal  must  remain  a  world  in  which  consumers  choose  how  they  communicate,  rather  than  one  in  which  that  choice  is  dictated  to  them  by  a 
 monopoly  or  the  government.  Todays  Order  provides  an  excellent  foundation  for  a  house  that  is  becoming  more  and  more  filled  with  innovative  products  and  greater  digital  opportunities. 


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 Federal  Communications  Commission  FCC  04-  27 
 to  cooperate  fully  with  any  warrants  seeking  to  intercept  calls  placed  by  Free  World  Dialup  subscribers. 


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 Federal  Communications  Commission  FCC  04-  27 
 DISSENTING  STATEMENT  OF  COMMISSIONER  MICHAEL  J.  COPPS 
 Re:  Petition  for  Declaratory  Ruling  that  pulver.  coms  Free  World  Dialup  is  Neither  Telecommunicaitons  Nor  a  Telecommunications  Service,  Memorandum  Opinion 
 and  Order  (WC  Docket  No.  03-  45) 
 In  this  Order,  we  leap  before  we  look.  The  Commission  declares  that  Free  World  Dialup  is  an  information  service  but  does  not  address  any  of  the  consequences  of  its  decision.  This 
 headlong  jump  into  Title  I  presents  stark  challenges  for  law  enforcement  and  has  implications  for  universal  service,  public  safety  and  state  and  federal  relationships  that  we  have  yet  to  untangle  or 
 assess.  Under  these  circumstances  I  believe  it  is  reckless  to  proceed  and  I  cannot  support  this  decision  at  this  time. 


 Two  years  ago,  when  the  Commission  set  out  to  reclassify  wireline  broadband  Internet  access,  I  suggested  it  was  irresponsible  to  do  so  without  addressing  the  larger  implications  of  our 
 decision.  Shortly  thereafter,  the  Commission  proceeded  down  the  identical  path  in  a  declaratory  ruling  reclassifying  cable  modem  service.  My  objections  were  the  same.  We  said  we  were 
 conferring  certainty  to  business,  but  the  decision  has  been  overturned  in  court,  confusion  still  reigns  and  the  larger  questions  remain  unanswered. 


 Yet  here  we  go  again.  Like  before,  our  approach  is  backwards.  With  bugles  blaring,  we  pronounce  the  classification  of  a  service,  but  leave  the  hard  part  understanding  the 
 consequences  for  another  day  and  time. 
 I  would  dissent  to  this  item  purely  on  law  enforcement  and  national  security  grounds.  The  Communications  Assistance  for  Law  Enforcement  Act  (CALEA)  expressly  exempts  entities 
 providing  information  services  from  complying  with  law  assistance  capability  requirements.  No  assurances  from  companies,  statements  from  this  Commission  or  last-  minute  letters  from  an 
 Executive  Branch  agency  have  yet  demonstrated  a  satisfactory  solution  to  this  thorny  problem.  On  January  28,  the  Federal  Bureau  of  Investigation  sent  a  letter  clearly  requesting  that  the 
 Commission  complete  a  rulemaking  on  CALEA  prior  to  the  other  related  but  non-  CALEA  specific  broadband  proceedings.  Otherwise,  the  letter  pointed  out,  the  outcome  of  our 
 broadband  classification  decisions  could  serve  to  prejudice  law  enforcements  rights  under  CALEA.  This  letter  urged  us  to  stop  in  our  tracks.  It  urged  us  to  resolve  national  security  needs 
 before  moving  ahead.  Even  in  a  more,  shall  we  say  forthcoming  letter  of  February  4,  the  Department  of  Justice  stated  that  [  w]  hile  it  would  obviously  be  our  preference  that  the  FCC 
 decide  these  issues  prior  to  considering  other  broadband  proceedings,  we  recognize  that  this  is  not  practical.  Both  letters  are  part  of  the  public  record. 


 I  met  with  both  the  Federal  Bureau  of  Investigation  and  the  Department  of  Justice,  but  I  think  anyone  who  reads  this  correspondence  will  be  left  with  the  indelible  impression  that  law 
 enforcement  strongly  prefers  that  the  Commission  resolve  outstanding  CALEA  matters  before  proceeding  with  any  further  broadband  reclassification  efforts.  I  do  not  understand  why  it  is  not 


 24 
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 Federal  Communications  Commission  FCC  04-  27 
 practical  to  pause  and  resolve  these  concerns  before  proceeding  to  categorize  Free  World  Dialup  service.  The  majority  apparently  prefers  to  act  now  and  fix  law  enforcement  issues  later  along 
 with  universal  service,  public  safety,  disability  access  and  a  host  of  other  policies  we  are  only  today  beginning  to  address  in  a  related  rule-  making  on  IP-  enabled  services.  This  rush  to 
 reclassify  will,  I  fear,  lead  us  down  a  road  wherein  we  are  compelled  to  engage  in  legal  calisthenics  and  contortion  of  both  CALEA  and  the  1996  Act  in  order  to  meet  our  statutory 
 obligations. 
 This  petition  has  been  in  front  of  the  Commission  for  over  a  year.  It  is  an  important  decision    but  not  so  important  that  it  cannot  wait  a  little  while  longer  while  we  conduct  an 
 expeditious  review  of  the  problems  that  a  too  hasty  decision  could  bring. 


 25 
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 Federal  Communications  Commission  FCC  04-  27 
 STATEMENT  OF  COMMISSIONER  KEVIN  J.  MARTIN 


 Re:  Petition  for  Declaratory  Ruling  that  pulver.  coms  Free  World  Dialup  is  Neither  Telecommunications  Nor  a  Telecommunications  Service,  WC  Docket  No.  03-  45. 
 Today,  the  Commission  takes  its  first  important  step  in  bringing  the  benefits  of  VoIP  closer  to  all  American  consumers.  By  declaring  Pulver.  coms  peer  to  peer  offering  to  be  an 
 unregulated  information  service,  we  provide  a  clearer  regulatory  framework  that  will  not  unduly  burden  these  offerings  with  economic  regulation. 


 I  believe  that  Pulver.  coms  Free  World  Dialup  (FWD),  and  other  similar  offerings  are  critical  in  the  Commissions  efforts  to  encourage  local  competition  and  provide  all  Americans 
 with  greater  choices  and  lower  prices  for  communications  services. 
 As  I  have  stated  previously,  as  VoIP  services  move  toward  becoming  a  substitute  for  traditional  telephony  services,  we  need  to  carefully  consider  and  address  any  questions  and 
 concerns  regarding  the  obligations  to  provide  traditional  public  safety  services  such  as  911  and  the  ability  to  comply  with  law  enforcement  requirements.  I  thus  support  todays  announcement 
 that  the  Commission  will  soon  initiate  a  comprehensive  rulemaking  to  address  law  enforcements  needs  relative  to  CALEA  and  that  our  decision  today  will  not  prejudice  the 
 outcome  of  that  proceeding. 


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 Federal  Communications  Commission  FCC  04-  27 
 STATEMENT  OF  COMMISSIONER  JONATHAN  S.  ADELSTEIN 
 CONCURRING  IN  PART  AND  DISSENTING  IN  PART 
 Re:  IP-  Enabled  Services,  Notice  of  Proposed  Rulemaking  (2004)  (Approving  in  Part,  Concurring  in  Part). 


 Re:  Petition  for  Declaratory  Ruling  that  pulver.  coms  Free  World  Dialup  is  Neither  Telecommunications  Nor  a  Telecommunications  Service,  Memorandum  Opinion  and 
 Order,  WC  Docket  No.  03-  45  (2004)  (Concurring  in  Part  and  Dissenting  in  Part). 
 Today,  we  consider  two  items    a  comprehensive  Notice  of  Proposed  Rulemaking  and  a  declaratory  ruling  on  a  specific  service    related  to  Voice  over  Internet  Protocol  (VoIP)  and 
 Internet  Protocol  (IP)-  enabled  services. 
 NPRM 
 With  this  Notice,  we  examine  the  extent  and  legal  significance  of  the  telecommunications  industrys  growing  adoption  of  IP-  enabled  services.  This  technological  evolution  stems  from  the 
 development  of  a  common  digital  protocol,  the  IP  in  VoIP.  It  is  integral  to  an  explosion  of  choices  for  consumers,  such  as  phones  in  PDAs,  voice  through  Instant  Messaging-  like  services, 
 not  to  mention  lower  prices  on  the  services  we  are  accustomed  to.  I  am  struck  by  the  wealth  of  innovation  occurring  under  the  banner  of  VoIP.  As  a  consumer,  I  think  we  all  have  much  to 
 look  forward  to. 
 As  a  Commissioner,  I  think  we  take  an  important  and  responsible  step  today  by  opening  a  comprehensive  Notice  of  Proposed  Rulemaking  on  the  regulatory  issues  associated  with  IP-enabled 
 services.  VoIP  services  have  matured  recently  and  it  is  apparent  that  VoIP  providers  have  their  sights  set  on  that  most  mainstream  of  telecommunications  markets    the  residential 
 consumer.  VoIP  providers  point  out  that  their  services  have  the  potential  to  provide  a  rich  and  diverse  array  of  complementary  non-  voice  applications  that  will  stir  demand.  All  indications  are 
 that  IP  is  becoming  the  building  block  for  the  future  of  telecommunications. 
 Questions  about  what  this  evolution  means  for  consumers,  providers,  and  this  Commission  are  far  from  simple.  What  they  present,  though,  is  an  opportunity    indeed  a 
 necessity    for  this  Commission  to  facilitate  that  evolution.  Todays  items  herald  the  Commissions  role  in  promoting  innovative  technologies.  At  the  same  time,  though,  we  are 
 charged  under  the  Communications  Act  with  ensuring  that  the  goals  set  out  by  Congress  are  fulfilled.  Forging  the  right  regulatory  scheme  to  achieve  these  goals  is  our  task  and  it  is 
 fundamental  that  we  begin  to  wrestle  with  these  issues  in  earnest. 
 I  would  like  to  thank  Chairman  Powell  for  his  leadership  on  VoIP.  The  Chairman  convened  a  forum  on  these  issues  in  December  that  I  found  extremely  useful.  I  have  also 
 appreciated  his  willingness  to  engage  his  colleagues  in  the  deliberations  over  these  items.  We  do  not  agree  on  every  detail  about  how  to  move  forward,  but  I  appreciate  his  willingness  to 


 27 
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 Federal  Communications  Commission  FCC  04-  27 
 accommodate  so  many  of  my  concerns  as  we  start  this  larger  rulemaking. 
 I  fully  expect  that  this  Notice  will  allow  us  to  develop  a  comprehensive  record  about  the  development  of  IP-  enabled  services.  Chief  among  our  tasks  is  to  determine  how  the  adoption  of 
 IP-  enabled  services  affects  those  most  fundamental  telecommunications  policies  embodied  in  the  Communications  Act.  The  Act  charges  us  to  maintain  universal  service,  which  is  crucial  in 
 delivering  communications  services  to  our  nations  schools,  libraries,  low  income  consumers,  and  rural  communities.  We  will  need  to  look  closely  at  how  IP-  enabled  services  affect  our 
 ability  to  fund  and  deliver  those  services.  The  support  that  our  universal  service  programs  bring  to  our  nations  rural  communities  is  critical,  so  I  am  particularly  glad  that  this  Notice  seeks  direct 
 comment  on  issues  of  concern  to  Rural  America. 
 As  we  go  forward,  we  also  must  understand  how  IP-  enabled  services  will  affect  the  provision  of  911,  E911,  and  other  emergency  services;  the  ability  of  people  with  disabilities  to 
 access  communications  services;  the  application  of  our  consumer  protection  laws;  the  ability  of  our  law  enforcement  officials  to  rely  on  CALEA  to  protect  public  safety  and  national  security; 
 and  other  national  priorities  such  as  consumer  privacy  and  network  reliability.  We  must  understand  that  our  decisions  can  have  disparate  impact  on  particular  communities.  We  raise 
 many  issues  in  todays  NPRM,  and  we  will  need  to  reach  out  to  the  many  and  diverse  interests  of  consumers,  network  providers  of  all  types,  hardware  and  software  manufacturers,  and  federal, 
 state  and  local  policymakers. 
 I  agree  with  my  colleagues  that  there  may  be  some  questions  that  we  need  to  answer  about  the  regulation  of  VoIP  services  sooner  rather  than  later.  There  are  time  sensitive  issues  on 
 the  table  for  us,  such  as  the  erosion  of  the  base  of  support  for  universal  service.  This  Commission  has  not  hesitated  in  the  past  to  address  issues  of  regulatory  arbitrage,  and  I  think 
 that  we  will  have  to  look  closely  and  quickly  at  some  of  the  concerns  that  have  been  brought  to  our  attention. 


 Pulver.  com 
 In  approaching  these  monumental  tasks,  however,  I  am  concerned  that  we  not  get  too  far  ahead  of  our  record.  The  rapid  and  dynamic  pace  of  the  migration  to  IP  and  broadband  services 
 counsels  for  a  full  consideration  of  the  issues  wherever  possible. 
 Many  persuasive  arguments  were  made  as  to  why  Pulver.  coms  Free  World  Dialup  (FWD)  is  not  telecommunications  or  a  telecommunications  service.  I  concur  that  this  service  is 
 not  telecommunications  or  a  telecommunications  service  and  in  practice  should  remain  largely  unregulated.  In  particular,  the  peer-  to-  peer  nature  of  FWD  differs  in  significant  respects  from 
 traditional  telecommunications  services  that  traditional  phone  companies  have  offered.  However,  I  cannot  fully  join  todays  pulver.  com  Order  because  it  reaches  far  beyond  the  petition 
 filed  by  pulver.  com  and,  regrettably,  speaks  prematurely  to  many  of  the  important  questions  raised  in  todays  NPRM. 


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 Federal  Communications  Commission  FCC  04-  27 
 Despite  attempts  to  characterize  this  Order  as  limited  to  the  specific  facts  of  pulver.  coms  FWD,  I  am  concerned  that  the  decision  speaks  much  more  expansively.  By  deciding  the 
 statutory  classification  of  pulver.  coms  service  as  an  interstate  information  service,  the  Order  raises  a  host  of  questions  about  the  continuing  relevance  of  those  most  fundamental 
 telecommunications  policy  objectives  that  Congress  has  entrusted  to  this  Commission.  At  last  Decembers  VoIP  forum,  I  talked  about  these  concerns  and  was  struck  by  how  widely-  held  those 
 concerns  seemed  to  be. 
 Todays  Order  does  not  fully  address  these  widely-  acknowledged  concerns.  One  might  read  this  Order  as  silent  on  many  of  these  ultimate  issues,  which  strikes  me  as  curiously 
 dismissive  given  the  magnitude  of  the  responsibilities  entrusted  to  us.  Parsing  more  closely,  the  declarations  about  jurisdiction  and  the  unregulated  nature  of  the  service  seem  to  presume  the 
 outcome  of  the  very  rulemaking  we  launch  today.  Pulver.  coms  petition  did  not  request  a  ruling  on  the  appropriate  jurisdictional  classification,  and  many  parties  may  be  unaware  that  we 
 planned  to  reach  that  question  in  this  Order.  With  both  the  jurisdictional  finding  and  the  unaddressed  implications  of  the  statutory  classification,  I  would  have  preferred  that  we  defer 
 these  important  policy  considerations  until  the  Commission  has  a  more  comprehensive  record  with  the  benefit  of  the  participation  of  the  many  stakeholders  who  should  be  part  of  this  debate. 


 One  area  where  we  did  have  participation  was  in  the  critical  area  of  law  enforcement.  Legitimate  concerns  were  raised  by  the  Federal  Bureau  of  Investigation  and  the  Department  of 
 Justice.  While  the  Department  of  Justice  has  acquiesced  to  the  desire  to  open  this  inquiry,  its  clearly  stated  preference  was  to  resolve  CALEA  matters  as  soon  as  possible.  While  I  dissented 
 from  todays  ruling  that  FWD  is  an  information  service,  I  am  pleased  that  we  commit  to  opening  a  CALEA  proceeding  very  soon,  and  that  the  Justice  Department  has  not  objected  to  our  moving 
 forward  in  the  interim. 
 For  these  reasons,  I  can  only  concur  in  part  and  dissent  in  part  on  the  pulver.  com  Order  and  thus  I  can  only  concur  in  those  portions  of  the  NPRM  where  that  item  imports  this 
 overreaching  analysis. 
 Finally,  I  would  like  to  thank  the  Wireline  Competition  Bureau,  and  in  particular,  the  Competition  Policy  Division.  Bureau  staff  members,  as  well  as  my  own  staff,  have  spent 
 countless  hours  and  long  nights  working  through  complex  issues.  They  are  truly  public  servants  of  the  highest  caliber. 


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