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VoIP - To Be or Not to Be a Telecommunications Company: Lower Court Reversed in Cable One Decision

By Zachary Atkins and Andrew Appleby

The Arizona Court of Appeals held that Cable One, Inc. was subject to c

June 14, 2013

By Zachary Atkins and Andrew Appleby

The Arizona Court of Appeals held that Cable One, Inc. was subject to central assessment as a telecommunications company because of its Voice over Internet Protocol (VoIP) service offering. The court found that Cable One, which provided cable television, Internet access and VoIP services, met the statutory definition of a “telecommunications company” because it owned communications transmission facilities and provided “telecommunications exchange and inter-exchange access.” The latter finding marked a significant departure from the lower court’s decision, which held that Cable One did not provide “telecommunications exchange and inter-exchange access” because it did not connect its VoIP subscribers to an exchange. The appellate court, in contrast, reviewed the legislative history and determined that “telecommunications exchange and inter-exchange access” mean local telephone service and long-distance telephone service, respectively. Since Cable One’s VoIP service permits subscribers to make and receive local and long-distance telephone calls, the appellate court concluded that Cable One provided “telecommunications exchange and inter-exchange access.” Cable One, Inc. v. Ariz. Dep’t of Revenue, Cause No. 1 CA-TX 12-0006 (Ariz. Ct. App. June 11, 2013).

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