VOIP: Cheaper, better

Sen. Manuel Roxas II, co-chairman of the Senate oversight committee on e-commerce, is set to file today a bill that aims to promote the widespread use and deployment of voiceover internet protocol (VOIP) as a cheaper way for Filipinos to communicate with friends and relatives abroad.

Roxas said there is an urgent need to review and amend some provisions of telecommunications laws.

He said the laws may have been rendered ineffective or obsolete by changing business models, consumer demands and technological innovations.

"Using VOIP lowers communication costs. It enables our OFWs (overseas Filipino workers) to communicate with their loved ones as often as they want, our BPOs (business process outsourcing) and exporters to transact businesses at lower cost, making them even more competitive," Roxas said.

VOIP is a generic term that refers to all types of voice communication using internet protocol technology, instead of the traditional circuit switch technology used by conventional telephone systems.

It enables users from different parts of the world to engage in voice conversations, even from long distances, without having to pass through part or all of the telecommunications facilities.

Based on a global research by industry consultants Frost and Sullivan, about 75 percent of global voice traffic will be done through VOIP by 2007.

The consulting firm also projected that sales of VOIP equipment will hit $2.7 billion — with Southeast Asia alone accounting for $1.2 billion — during the same period.

Using VOIP, a person can engage in international voice conversations without having to pass through and pay telephone companies who charge much higher fees for the use of their networks.

"In the global world of commerce there is a shift in business models brought about by technological innovations which may have rendered some of our laws practically ineffective," Roxas said.

He said there is a need to amend Republic Act 7925, otherwise known as the Public Telecommunications Policy Act. There is a continuing debate if VOIP technology can be classified as a telecom service by itself or a value-added service.

In a memorandum dated March 29, 2005, the National

Telecommunications Commission (NTC) argued that under RA 7925, VOIP is considered a value-added service (VAS). Giant telecommunication firms, however, argued against it.

"The commission hereby defines VAS as enhanced services beyond those ordinarily provided for by local exchange and inter-exchange operators, and overseas carries through circuit switched networks," it said.

But for his part, Roxas pointed out that interpretation of the law is not the key issue. Instead, he said that it is the market forces and the technology that have overtaken certain provisions of the law.

"Until Congress comes up with its own clear definition, this is the policy position of the NTC: that VOIP is not a traditional voice service, that it is not subject to capture by the telcos or the telecommunication companies," he said.

But Roxas noted that now, "the market is already ahead of us, rendering some provisions of our laws obsolete."

NTC has reported that OFWs, exporters and call centers are among the heavy users of VoIP because of its low cost.

The NTC also said the widespread use of VOIP makes it necessary for the government to come up with regulations that would encourage the development of new applications and services to enhance Philippine competitiveness in the global information and communication technology market.

"There is an immediate need to modernize some provisions of our existing laws to catch up with the trend. But Congress must see to it that our OFWs, call center operators and exporters or the consumers in general will continue to benefit and will not be taken advantage (of) by unscrupulous businessmen," Roxas said.

The Senate committee on public services is set to invite officials of telecommunication firms like Smart, Globe and Digitel to attend the next hearing. According to the NTC, parallel moves to push for VOIP regulation have also been filed at the House of Representatives. — Christina Mendez