Out with the old and in with the new. Humans are consuming and generating more data than ever before, which is requiring businesses to make better data decisions. The analog era is coming to an end. Businesses and homes alike are looking for cheaper, more reliable, flexible options.

The FCC’s Ruling & What It Means

February 5th, 2020 concluded The Federal Communications Commission’s (FCC) open comment period regarding WC Docket No. 19-308, which aims to address provisions in the 1996 Telecom Act. This targets regulations dealing with unbundling and resale requirements affecting incumbent local exchange carriers (ILECs), also known as local telephone companies, and plain old telephone service (POTS). The proposal, set forth by the FCC, would no longer require ILECs to unbundle services including DS-0, DS-1, DS-3, and voice-grade loops and dark fiber transport.

Before enactment of the Telecommunications Act of 1996, local telephone companies held a monopoly on local telephone service. Congress passed the 1996 Act to open these local markets to competition and required ILECs to unbundle and open their networks to competitors at cost-based rates, and to offer for resale at wholesale rates telecommunications services that the ILEC offers at retail. At the same time that it established these local market-opening provisions, Congress also left it to the Commission to determine which network elements should be subject to unbundling obligations, and gave the Commission the authority to forbear from these and other regulatory obligations if they became no longer necessary in light of changes in the industry.

Over the past several decades, the telecom industry has become increasingly competitive because of the provisions in the 1996 Telecom Act, giving smaller companies existing infrastructure for resale at competitive prices. It gave providers the ability to offer voice and data solutions for a competitive price. Thus, we are circled back to today, where cloud solutions and VoIP/SIP are popular phone options for many companies.

Background on POTS, SIP, VoIP & Other Abbreviations

Plain old telephone service, or POTS, is exactly what it sounds like. It is an analog voice transmission phone system implemented over copper twisted pair wires. It is the plain old phone line technology most of us grew up with at home.

All of the advancements in technology over the years meant it was only a matter of time before POTS was replaced as everyone’s go-to phone system. A lot of businesses have IP telephony, or are in the process of migrating to it. We tend to use SIP and VoIP interchangeably. They both refer to communications over the Internet or other IP-based connection. Session Initiation Protocol, or SIP, is one of the protocols (the most popular one) used in VoIP communications. VoIP offers more cost savings compared to its traditional counterpart, while also offering many great features that aren’t possible with POTS. In fact, from a cost perspective, SIP and VoIP services will nearly always be less expensive than POTS, or service from ILECs. Depending on the exact circumstances and connections available, SIP/VoIP can typically save from 50% – 90% on monthly telecom expenses.

With the new rulings, now is an even better time to switch to VoIP as a primary option. Visit CallHarbor.com for more information on our VoIP hardware and our high-tech features, to chat with an agent, or to schedule a demo of our services.