Research Of VoIP Regulation

Since the emergency of Internet Phone software from a Israel company, VoIP diverts numerous traffic from traditional telephone services and sequently incurs great structural changes to the industry. As a correspondence, there need some adaptation in the regulation policies.As a substitute, VoIP providers precede arbitrage between unprofitable Internet and profitable telecommunications network, especially P2P softwares. By transporting traffic in the internet which bypasses current settlement system of PSTN, VoIP service providers avoid cost compensation and further snatch revenue especially from long-distance phone calls which perform the foundation of universal services.On the other hand, the traditional operators in monopoly position concern the possibilities of competition. That's the reason they repel the introduction of new technologies so fiercely.That's the source of game play between VoIP service providers and traditional operators. And the target of regulator is to realize maximum of long-term social profit and keep balance between profit of service providers and surplus of customers, cost compensation and market competition. This paper is to discuss regulation resolution to solve these problems.In Chapter One, I made a brief introduction to the regulation theory and the practices in the telecom industry. Then in the following Chapter, after the description of VoIP development in the international market, including the business model of the most popular P2P software Skype, I analyzed the changes of social welfare in section 2.4 and further point out the regulation embrassment challenged by the VoIP which should be considered in the regulation framework. In the third and fourth parts of this paper, I made some recommendation on the base of regulation experience in other countries.