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FCC denies SBC's request for price flexibility

SBC won't have much freedom in setting prices for linking Internet calls to the phone network. But the FCC promises to revisit the topic soon.

Declan McCullagh Former Senior Writer
Declan McCullagh is the chief political correspondent for CNET. You can e-mail him or follow him on Twitter as declanm. Declan previously was a reporter for Time and the Washington bureau chief for Wired and wrote the Taking Liberties section and Other People's Money column for CBS News' Web site.
Declan McCullagh
Federal regulators have denied a request from SBC Communications for more flexibility in charging for Internet voice connections.

In its 12-page ruling, the Federal Communications Commission on Thursday stressed that it reached this conclusion largely on procedural grounds and will address voice over Internet Protocol rules in a broader, separate ruling. The vote was 4-0.

SBC had asked for an exemption from decades-old "common carrier" obligations such as government-approved pricing. Its request dealt with SBC's "TIPToP" service, which links VoIP calls to the traditional phone network.

"While we had hoped that the FCC today would embrace the opportunity our petition offered to conclusively set a policy framework for the converging world of communications, we also remain optimistic that this Commission, through the leadership of Chairman (Kevin) Martin, is poised to take these issues head-on over the next several months," James Smith, a senior vice president at SBC, said in a statement.

The FCC is currently working on a far-reaching set of regulations that deal with Internet protocol services. A portion deals with price regulation.

"Although, by today's action, we deny SBC's forbearance petition on procedural grounds, I believe that the issues presented by this petition are important ones that require the commission's attention," FCC Chairman Martin said Thursday.

Another reason for the agency to deny SBC's request is the Brand X case, already before the U.S. Supreme Court and expected to be decided in June. Depending on the wording, a decision on cable regulation could impact other Internet services.