Cable Broadband, VoIP Covered by CALEA

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Cable companies that provide high-speed Internet access and offer managed Internet-protocol-based phone services must comply with a law that authorizes law enforcement to wiretap communications networks, the Federal Communications Commission tentatively ruled Wednesday in a unanimous decision designed to shore up the country’s defense against terrorism.

Under pressure from the Department of Justice and state law enforcers, the FCC acted in an effort to plug holes in the national surveillance network and deny drug dealers, kidnappers and terrorist cells a broadband safe haven from a 1994 statute called the Communications Assistance for Law Enforcement Act, or CALEA.

“Our support for law enforcement is unwavering, and it is our goal in this proceeding to ensure that law-enforcement agencies have all of the electronic-surveillance capabilities of CALEA authorizing them to combat crime and terrorism and to support homeland security,” FCC chairman Michael Powell said.

The DOJ, the FBI and the Drug Enforcement Agency were concerned that in the wake of FCC rulings that classified cable-modem service and at least one voice-over-IP service as information services, they would lack authority to invoke CALEA against cable-broadband platforms and VoIP providers.

Because CALEA covers telecommunications carriers and not information-service providers, law enforcement feared that the FCC had carved out an unacceptable CALEA loophole at a time when the nation is waging a global war against terrorism after the Sept. 11, 2001, attacks on New York and Washington, D.C.

When the FCC’s final rules take effect, cable companies that offer high-speed Internet services and managed-VoIP services must install software that permits law enforcement to track communications by routing address and by content of the communication instantaneously, an FCC official said. Some of the cost can be reimbursed by the federal government.

Cablevision Systems Corp. -- which offers its “Optimum Voice” VoIP service to 4.4 million homes in the New York area and which has signed up 100,000 subscribers -- already complies with CALEA, a Cablevision spokesman said.

According to New York Attorney General Eliot Spitzer, New York State accounts for about 30% of the 1,500 communications intercepts that courts authorize each year.

The National Cable & Telecommunications Association issued a short statement agreeing with the FCC’s decision insofar as it would apply to VoIP services. The NCTA statement did not directly endorse the FCC’s ruling to the extent that it covered broadband-access providers and to the extent that it did not cover nonmanaged VoIP services.

"The cable industry strongly supports the application of CALEA requirements to VoIP services. We will study the FCC's proposals and file formal comments once we have had the opportunity to review them further,” NCTA spokesman Brian Dietz said.

In his statement, Powell noted that the FCC planned to apply CALEA to broadband providers without altering the agency’s March 2002 ruling that cable-modem service is an information service within the meaning of federal communications law.

However, that FCC ruling was overturned by the U.S. Court of Appeals for the Ninth Circuit, which held that cable-modem service is partly a telecommunications service -- an interpretation that might require cable operators to sell wholesale broadband access to competing broadband access providers.

By appeasing the DOJ with its CALEA action, Powell may have gained its support to appeal the Ninth Circuit’s ruling to the Supreme Court later this month. The NCTA is planning to appeal with or without the DOJ's support.

Ed Thomas, chief of the FCC’s Office of Engineering and Technology, said the new CAELA rules would cover any communication flowing over cable’s broadband networks.

“It’s access to the channel. It’s not necessarily service-specific,” Thomas said. “That information could be anything from video to instant messaging, and it does apply to that, provided that it goes over a broadband-access connection.”

The FCC acknowledged that its ruling was not comprehensive.

It would not cover so-called nonmanaged VoIP services, including peer-to-peer Internet-phone services provided by Pulver.com Inc. (www.pulver.com) and Skype Technologies S.A.

Skype is Web-based software that users can download to speak with other Skype customers free-of-charge. A Skype user requires a headset and microphone that plug into a computer with a broadband connection. The service has 7.7 million users around the globe.

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