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Vonage Wins Waiver From FCC to Directly Access Telephone Numbers

April 18, 2013

Vonage Holdings Corp. (VG:US) today won the right to directly access telephone numbers for assignment to its customers, as U.S. regulators study allowing other voice-over- Internet companies to also bypass middlemen who supply numbers.

The U.S. Federal Communications Commission in a 4-0 vote granted Holmdel, New Jersey-based Vonage a six-month trial as the agency writes rules that Internet-calling companies say would clear the way for lower-cost calls over modern networks. Opponents such as Level 3 Communications Inc. (LVLT:US) say the change risks service quality.

Internet-calling companies now buy numbers from traditional phone companies that are tied to area codes, and are accredited by states. The change could offer new freedom for phone numbers to be assigned regardless of location. For example, numbers in the 212 area code might be offered to customers who don’t live in New York.

“It’s about numbers, but it’s about a lot more,” said FCC Chairman Julius Genachowski. “This continues our ongoing efforts at the agency to modernize our rules for today’s broadband marketplace.”

The changes would reduce barriers for “innovative, online” providers of voice services, Genachowski said.

The agency must vote again on rules before the wider change could take place.

The links between place and phone number have already weakened as people retain numbers when they switch wireless carriers, or to a voice-over-Internet provider.

Middle Men

Vonage, , now buys access to numbers, including their area codes, from middlemen such as Broomfield, Colorado-based Level 3 that have government authorization to pull numbers in a system managed by the North American Numbering Plan Administration, a neutral overseer run by NeuStar Inc., (NSR:US) based in Sterling, Virginia.

Level 3 opposes the change, saying calls might be mishandled by companies without experience as certified telecommunications carriers.

Allowing companies that aren’t state-regulated to get direct access to numbers sets up the possibility of anti- consumer practices, groups including Consumers Union said in an April 11 letter to Genachowski. Other signers included Common Cause, AARP and the National Association of Regulatory Utility Commissioners, a Washington-based nonprofit representing state commissions.

Robert McDowell, a Republican FCC member who has announced his resignation, didn’t take part in today’s vote. Genachowski, chairman since 2009, on March 22 said he would leave the agency within weeks and hasn’t specified his last day.

To contact the reporter on this story: Todd Shields in Washington at;

To contact the editor responsible for this story: Bernard Kohn at

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