What is Internet Telephony?

Internet Telephony: The Concept

(a) Meaning :

Internet Telephony is a form of Internet Protocol (IP) Telephony. IP Telephony is used as a generic term for the many different ways of transmitting voice, fax and related services over packet-switched IP-based networks. The basic steps involved in originating an Internet telephone call are conversion of the analog voice signal to digital format (binary data) and compression/translation of the data into IP packets for transmission over the Internet; the process is reversed at
the receiving end. This process is called modulation-demodulation, giving the term modem. The communication usually takes place real time.Thus, the main difference between Internet Telephony and normal telephony is that whereas in normal telephony, circuit switching technology is used, Internet Telephony is based on packet switching technology.

(b) Difference between Internet Telephony and Voice-over-IP

IP Telephony can be subdivided into two major groups: Internet Telephony and Voice-over-IP (VoIP), the difference being the type of the underlying IP network i.e. the medium of transmission. Internet telephony primarily involves the usage of the Internet rather than the Public Switched Telephone Network (PSTN) to transmit ‘real-time’ audio from one personal computer (PC) to another (or in some instances to another telephone itself). However, in the case of VoIP, it is generally an IP technology suite (i. e. a private network) that is used rather than the public Internet.
Another important distinction between Internet Telephony and VoIP is the quality of the transmission. Since VoIP is usually a closed / private network, the technical hurdles are less daunting, which results in greater reliability in the transmission of voice packets than in Internet Telephony where the voice packets are transmitted on the Internet. Therefore, the chances of having a live or real-time conversation are better in VoIP than in Internet Telephony.

(c) Methods of Internet Telephony

Following are the popular methods of Internet Telephony as recognised by the International Telecommunications Union (ITU)

(i) PC to PC
Under this method, calls are transferred from one PC to another PC. No gateway with a PSTN is required, because calls are not switched by a PSTN. Rather, the principal medium of transmission is always the Internet.

(ii) PC to Phone / Fax
Under the PC to Phone / Fax method, the conversion of speech into packets takes place on the originating users PC. The process is reversed at an Internet Telephone Service Providers (ITSP) gateway server, which then dials the called partys telephone number and, when a connection is made, starts sending the callers speech and transmitting the called partys speech in the other direction. The PC to Phone / Fax category includes PC to PhoneVoice and PC to Call Centre services.

(iii) Phone to Phone
Phone to Phone method of Internet Telephony is closely associated with the traditional telephone experience. ITSPs are required to install their own gateways and enter into termination agreements all over the world, both with independent ISPs as well as established PTOs. In Phone to Phone Internet Telephony, the customer, using an ordinary telephone, dials an access code and then the telephone number; the access code then routes the call to a special computer gateway (the IP network). Local computer gateways for companies offering this type of service must be optimally placed in strategic geographic areas. For instance, if a customer using phone-to-phone Internet Telephony plans to call London (England) from Mumbai (India), then local gateways must be located in both London and Mumbai. The gateways convert audio into data for transmission across the IP network and then convert incoming data back into analog signals.

Licensing Internet Telephony Services in India

Pursuant to the New Telecom Policy, 1999, the DoT has announced guidelines permitting ISPs to process and carry voice signals (Guidelines). ISPs can only offer these services within the service areas for which they have a licence. Pursuant to the Guidelines, the DoT has revised the Licence Agreement for ISPs to include the provision of Internet telephony services (Revised Licence). The Revised Licence has been issued under the authority granted to the DoT under the Indian Telegraph Act, 1855, the Indian Wireless Telegraphy Act, 1933 and the TRAI Act, 1997.

All ISPs desirous of providing Internet telephony services also have to make an application to the DoT for signing an Amendment to their existing ISP licence. The old ISP licence agreement, which banned Internet telephony services read as follows:
1.12.3 Telephony on the Internet: Telephony on the Internet is not permitted. The licence will be liable for termination for any violation of this clause of the Licence Agreement. The licensee shall also take measures on his own and as and when directed by the Government at his own cost to bar carriage of Telephone traffic over Internet.

However, the Revised Licence does not contain the above clause, and allows ISPs to provide Internet access / content services including, Internet telephony services.

(a) Provision of Internet Telephony Services  As per the Revised Licence, Internet Telephony is an application service, which customersof ISPs can avail of from their PCs or other IP based Customer Premises Equipment (CPE).The Revised Licence restricts the manner in which ISPs can provide Internet Telephony services to onlythree types:

(i) From a PC in India to a PC inside and outside India
(ii) From a PC in India to a telephone outside India
(iii) From an IP-based H.323/SIP Terminal in India to similar terminals in India and abroad provided they employ the IP addressing scheme of the Internet Assigned Numbers Authority ISPs are not allowed to provide any Internet telephony services which fall outside the purview of the above three modes.
It can be seen that the scope of Internet telephony in the second mode to only telephones outside India. So if an Internet telephony service provider allows a PC user in India to call a telephone in India, the same would violate the Revised Licence and the ISP could be penalized for the same. It seems that the DoT has stipulated this condition so that national long distance operators do not lose out on their customer and revenue bases.

(b) Services that fall outside the purview of Internet Telephony
The Revised Licence also states that ISPs are prohibited from offering the following types of services as they fall outside the purview of Internet telephony:

(i) Voice communication from anywhere to anywhere by means of dialing a telephone number (PSTN/ISDN/PLMN) as defined in National Numbering Plan;
(ii) Originating the voice communication service from a telephone in India;
(iii) Terminating the voice communication to telephone within India;
(iv) Establishing connection to any public switched network in India;
(v) Dial up lines with outward dialing facility from nodes; and
(vi) Interconnectivity between ISPs who are permitted to offer Internet telephony services and the ISPs who are not permitted to offer Internet telephony services.

(c) Quality of service (QOS) terms
The Do has not provided any parameters for the QOS14 for Internet telephony in the Revised Licence. The Guidelines and Revised Licence state that the Telecom Regulatory Authority of India (TRAI) shall prescribe the QOS from time to time.

The role of the TRAI is to create an environment conducive to the growth of telecom sector, and safeguard a customer’s interest and ensure that he gets the QoS that he has contracted for. As regards QOS, the TRAI has the substantive role in laying down standards, assessment of QOS, and action for improvements. It has, therefore, the following main functions
to perform in this regard:
(i) Setting Quality of Service Standards
(ii) Monitoring
(iii) Enforcement
As of now, the TRAI has not framed any QOS for Internet telephony. Once the TRAI imposes certain basic QOS parameters, ISPs will be obligated to meet the minimum QOS criteria while providing Internet telephony services to their customers.
In order that the customers can effectively utilize Internet telephony services, the TRAI should formulate the QOS terms as soon as possible.

(d) Tariff / Fees
The Guidelines state that the TRAI has not levied any tariffs on ISPs for the Internet telephony services that will be provided over the public Internet. However, there is a saving provision that states that the TRAI may levy a tariff at any time and it shall be binding on the ISP to pay such tariff. This provision has also been incorporated in the Revised Licence. Moreover, the ISPs do not have to pay any licence fee and USO levies for Internet telephony services. Nevertheless, the DoT reserves the right to impose a licence fee on the ISP at any time during the licence period.

Hitherto also, ISPs do not have to pay any licence fee for providing Internet services. The DoT has continued to impose this licence fee-free regime for ISPs in order to promote the proliferation of Internet usage and now, Internet telephony services. However, since Internet telephony services are in direct competition with basic telephony services, in the event there is unfair competition, the DoT could impose a licence fee to create a level-playing field.

(e) Security Monitoring
As per the Guidelines and Revised Licence, ISPs who provide Internet telephony services through their own Internet gateways would have to provide suitable monitoring facilities for the security agencies at their own cost. The ISPs also have to provide periodic reports to the DoT regarding the flow of Internet telephony traffic through its network.

(f) Inter-connection
The Revised Licence permits only ISPs who have obtained the requisite licence to offer Internet telephony services. It prohibits any interconnection between an ISP that is allowed to offer Internet telephony and an ISP that is not allowed to offer Internet telephony.

Emerging Legal Issues

(a) Ambiguity in Definition

While the Guidelines and Revised Licence discuss what services would amount to Internet Telephony for the Indian context, they have failed to define the term Internet telephony per se. The meaning given to the Internet telephony is a restrictive in nature, as it states what services would fall within and outside the purview of Internet telephony for the Indian ISPs. In fact, many of the services, which are prohibited under the Revised licence amount to Internet telephony in the international context. For example, originating or terminating a voice communication service from / to a telephone in India would amount to Internet telephony in the international context, if the public Internet is used as the medium of communication. The Guidelines and Licence do not lay down any clear parameters that need to be satisfied by any telecommunication service to be classified as Internet telephony. While this problem exists world over, and even at the ITU level, this ambiguity could lead to problems in the future when new forms of technology and modes of communication emerge. At the earliest, as TRAI has suggested, there is a need to distinguish between Internet Telephony and VOIP. The Governments of different countries need to come together and resolve this issue at the earliest.

(b) Meaning of PC and Telephone

The Revised Licence states that PC to PC Internet telephony is permitted in India. However, the Revised Licence does not clearly define a PC. Under the Information Technology Act, 2000 (ITA), a computer is defined as follows:
Computer means any electronic magnetic, optical or other high-speed data processing device or system which performs logical, arithmetic or memory functions by manipulations of electronic, magnetic or optical impulses, and includes all input, output, processing, storage, computer software, or communication facilities which are connected or related to the computer in a computer system or computer network. Thus the definition of a computer is extremely wide and is not merely restricted to a normal computer, which is used at home or in offices.

Moreover, while the Revised Licence states that the telephone call cannot be originated from or terminated on a telephone in India, it does not define the word telephone. Even the telecommunications laws in India have no clear definition of the term telephone.With the emergence of new technologies and products, the meaning of PC and telephone could be extended to also include personal digital assistants (PDA) (eg.palm pilots) and even mobile phones with computing power (like the Nokia 9110). Moreover, there is also a convergence between PDAs and telephones (like the TREO). If a call is made from such devices, it is uncertain whether the same would be legally permissible.

Another emerging legal issue is concerning IP phones. There exists some ambiguity as to whether IP phones can be freely used to provide Internet telephony services. While it is technically possible to originate calls from IP-based networks, it is uncommon to terminate calls from other networks onto an IP-based network (except in the case of IP PABX system). Since a call from to a number on the national numbering plan is prohibited, a call from an E.164 universal numbering plan may also not be allowed. However, the International Telecommunications Union is studying an option of assigning an E.164 numbering resource to an IP phone using the ENUM protocol. The ENUM protocol converts the E.164 number to an IP address, and a telephone user can call an IP phone by dialing the E.164 number. The perturbing question is whether this would be allowed under Indian laws as they stand right now.

Therefore, it would be necessary to determine and clarify the legitimacy of the type of instruments and the system being used while making an Internet telephone call in order to stay out of any legal problems.

(c) Quality of Services

One of the major difficulties in Internet telephony is in achieving a similar standard of QOS for Internet telephony services as for normal telephony services. The difficulty could arise due nature of the IP network. The IP network uses packet mode of data transmission that can degrade the quality of the voice communication as the packets could get lost in transmission on the public Internet, there could be a delay in transmission, there could be a variation in the packet arrival or there could be an echo effect due to the delay between the transmission of a signal and its receipt.

Therefore, while determining what amounts to real time in the context of Internet telephony, it is necessary that the TRAI keeps in mind the recommendations of the ITU on Real Time . The ITU in its recommendation no. G.114 (2.96 revision) recommended certain limits for one-way transmission time for conditions with echo adequately controlled . According to Recommendation G.131 (Stability and Echo):
0 to 150 ms: Acceptable for most user applications .150 to 400 ms: Acceptable provided that Administrations are aware of the transmission time impact on the transmission quality of user applications .above 400 ms: Unacceptable for general network planning purposes; however, it is recognized that in some exceptional cases this limit will be exceeded. Another practical difficulty that ISPs are facing is the lack of adequate co-operation from basic telephone operators. Unless the basic operators give better QOS in their agreements with ISPs, ISPs will not be able to provide better QOS to their subscribers. While last year, the TRAI released its recommendations for QOS for ISPs offering Internet Services, ISPs are unable to meet these QOS terms because of the lack of co-operation from basic operators. Therefore, the TRAI must keep in mind the existing competition and economic scenario while framing QOS for Internet telephony services.

(d) Liability of the ISP

The ITA contains provisions dealing with the liability of Network Service Providers (NSPs). A NSP has been defined under the Act to mean “an intermediary”. An “intermediary”, with respect to any particular electronic message, means any person who on behalf of another person, receives, stores or transmits that message or provides any service with respect to that message. Thus an ISP would be an NSP as it receives, stores or transmits electronic messages over the Internet on behalf of its subscribers. The ITA stipulates that every NSP is given general immunity as regards any offence under or contravention of the Act or the provisions made thereunder, if such NSP proves that:
(i) such offence or contravention was committed without its knowledge or
(ii) that it had exercised all due diligence to prevent the commission of such offence or contravention.
Under the ITA, publication or transmission or causing publication of any obscene information is an offence.

Therefore, if while using Internet telephony services, if the subscribers transmit any obscene information, the ISP could be held liable for such transmission. However, if the ISP can prove that it was not aware of such contravention or if it had taken reasonable steps to prevent such contravention, it may be immune from any penalty or liability. Therefore, ISPs must be careful to include appropriate terms in their subscriber agreements to preclude such liability.

(e) Validity of Messenger Services

Off late, there has been some debate regarding voice chat facility which instant messenger services have been offering. There are various issues that arise in this context which need to be addressed in order to determine whether such a voice chat facility is legal.

The first issue that arises is whether such services amount to Internet telephony. Under normal circumstances, they would amount to Internet telephony as the instant messengers use the public Internet as a means of transmitting voice between two or more users. The second and more important issue is whether these messenger services are permitted to offer these services in India. As discussed above, in order to offer Internet telephony services, the service provider requires a license. Currently only ISPs and basic service operators (i.e.BSOs, NLDOs and ILDOs) are allowed to provide such services as per the provisions of their licence. Moreover, no interconnection is allowed between an ISP who has the Internet telephony licence and an ISP that does not. Therefore, in order to offer the voice chat facility using the public Internet, the messenger would have to obtain an ISP licence. Otherwise, the messenger may have to enter into an appropriate arrangement with the ISP wherein the voice chat facility is offered to the messenger users. However, the validity of such an arrangement is also unclear under the law (specially as ISPs are not allowed to assign or sublicense their services). The issue is further complicated if the ISP with whom the messenger has an arrangement does not possess the Revised ISP licence. It is essential that ISPs and the messenger services settle this problem at the earliest.

(f) Blocking of Internet telephony websites

The ISP licence does not require that an ISP must provide Internet telephony services only to its Internet subscribers, nor does it mandate that Internet telephony and Internet services have to be provided together. However, news reports indicate that after April 1, 2002, some ISPs have started blocking access to websites of other rival ITSPs (including foreign ITSPs) . If so, do they have the authority to block the sites? Further, many ITSPs have tied up with international ITSPs to leverage their customer base. The viability of this option remains to be seen, as foreign ITSPs can set up 100% subsidiaries in India without the help of Indian ISPs. Infact, it may be economically advantageous for them to do so as they would already have their servers and networks established in foreign countries.

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