FCC votes to deregulate international calling market

The Federal Communications Commission voted Thursday to eliminate outdated regulations that govern agreements between American phone carriers and foreign firms.

The International Settlements Policy was established more than 80 years ago to ensure fair treatment for U.S. carriers when negotiating with foreign firms dominant in their home markets.

But the past 15 years have seen international calling rates drop precipitously, from 74 cents per minute to 8 cents per minute, even as the amount of international calling minutes has increased two and a half times.

"These changes have made the ISP less relevant and necessary to ensure fair competition," the commission said in an announcement. "In some cases the ISP may now be hindering attempts by U.S. carriers to negotiate agreements that reduce international telephone rates for American customers.

By eliminating the rules, the FCC said, American carriers would have more flexibility to make deals with foreign counterparts that reflect the current state of the market. The vote was 4-0, with Republican Commissioner Meredith Attwell Baker not participating.