On July 24, 2025, the California Public Utilities Commission (PUC) has adopted new service quality metrics that apply to fixed interconnected VoIP providers. Enforcement of the new rules will begin on July 1, 2026. The PUC adopted three service quality metrics: (1) service outage repair time; (2) installation interval; and (3) customer service call answer times. Failure to meet the standards will result in fines. There are also new reporting obligations. The PUC order and appendix can be found here and here. There is considerable ambiguity around the application of these standards to over-the-top VoIP services offered through software licenses and CCA members that serve very small businesses in California should consult with telecom counsel.
Important caveats. There are two important limitations to the new rules: (1) they only apply to fixed interconnected VoIP providers, they do not apply to nomadic-only providers; and (2) they only apply to residential customers or to small businesses with five or fewer lines. VoIP services provided to businesses purchasing more than 5 lines are exempt. The definitions of fixed and nomadic providers are taken from the PUC’s VoIP licensing proceeding. Fixed interconnected VoIP providers “offer voice service tied to [a] physical address associated with [a] subscriber’s primary place of use or registered location.” Nomadic-only providers “offer voice service not tied to [a] physical address associated with [a] subscriber’s primary place of use or registered location.” CCA has informed the PUC in the VoIP licensing proceeding that its members generally are nomadic-only providers. The out-of-service repair metric is further limited to facilities-based fixed interconnected VoIP providers.
As noted, the service metrics do not apply to businesses purchasing more than 5 “lines.” The PUC’s order does not have a specific definition of “line” but does defines an “access line” which appears relevant. An access line is a connection that provides a real time, two-way voice telecommunications service or VoIP service to or from any device used by an end user. A rough rule of thumb may be that each license (or seat) to use VoIP service on a device could be considered a line.
VoIP Out-of-Service Repair Metric
Finding that VoIP outages are “alarmingly high,” the PUC requires facilities-based fixed interconnected VoIP providers to repair individual customer outages within 24 hours, as measured from the receipt of a customer outage ticket. Outages are measured at the individual access line level. Providers must compile reports of outages on a monthly basis and submit them to the PUC quarterly. The PUC establishes various exemptions to the repair time, such as declared emergencies, natural catastrophes, or lack of premises access. Failure to meet the standards results in both fines payable to the state, starting at $5 per line per day, and credits payable to customers, starting at 1/30th of the service’s monthly bill for each day that exceeds the 24-hour repair standard. The fines and credits increase up to 4 times for longer outage times. Providers should consult the order for specific levels.
Fixed interconnected VoIP providers that fail to repair 90 percent of access line outages within 24 hours in a calendar month for six months or more within a calendar year must submit a Corrective Action Plan that outlines specific actions the company will take to improve performance.
The Order does not appear to define “facilities-based” in the context of fixed interconnected VoIP providers. The PUC is assessing the definition of a facilities-based VoIP provider in the VoIP licensing proceeding that may provide guidance. Otherwise, the PUC does have a general definition of facilities-based, which includes owning or operating last mile connections that is taken from previous service quality requirements. The PUC, however, struck reference of VoIP providers in that previous definition, which appears to suggest that the updated definition does not now apply to VoIP providers.
Installation Interval and Installation Commitment
The PUC requires fixed interconnected VoIP providers to establish basic VoIP service within 5 business days of when a customer places an install order. Providers must meet that standard 100 percent of the time, subject to certain delineated exemptions such as declared emergencies, natural catastrophes or lack of premises access. Failure to meet the standard results in a customer credit of $5 per day for each day over five days. The customer credit must be provided within 60 days. The metric does not appear to be limited only to facilities-based fixed providers but to all fixed interconnected VoIP providers.
The order defines an installation as the “process by which a service provider installs, configures, or programs a functional telephone line” at a customer’s premises for the provision of voice, data, or other communications service. This definition of “installation” creates some ambiguity as to the application of this standard to a customer that already has a broadband connection and is seeking to purchase over-the-top software-based services that includes VoIP. Again, the metric only applies to residential customers or small businesses with 5 or fewer lines. If a VoIP provider serves these customers, they must compile reports monthly and submit them quarterly to the Commission.
Answer Time/Customer Service Standard
The order adopts the following six customer service related requirements for fixed, interconnected VoIP providers:
Providers may give their customers an option to use a call-back service. If a customer uses the call-back service, and if the provider calls back within 24 hours, the call will not count against achievement of the answer time standard.
These standards must be met no less than 80% of the time measured on a quarterly basis. Failure to provide all six criteria results in a monthly fine equal to the following formula: number of access lines x $5 x 10% x number of days of noncompliance/ 365. Providers must compile monthly reports and submit them to the PUC quarterly.
The customer service standards do not apply to providers serving fewer than 5000 access lines total in California.
Reporting Requirements
Covered VoIP providers must internally compile compliance information monthly and submit reports to the PUC quarterly, within 45 days following the end of each quarter. These reports will be used to determine compliance and any related penalties. These quarterly reports must include: (1) active access line count; (2) service performance measures compared to established standards; (3) allowable exemptions (e.g., declared emergencies) wherever applicable, and (4) violations in Environmental and Social Justice (ESJ) communities. Providers must retain records for five years.
Fixed, facilities-based interconnected VoIP providers must also file with the PUC all Community Isolation reports currently required to be filed with the California Office of Emergency Services. These are outages that effect 911 services and are defined as an outage that lasts at least 30 minutes and potentially effects at least 100 end users in a single zip code or 50% of end users in a zip code with less than 100 end users. These outages must be reported within 60 minutes of discovery of the outage.
Providers must also provide the PUC with copies of any network outages filed with the FCC.
Providers that incur a fine for missing one of the service metrics must file an annual report with the PUC detailing all fines.
Next Steps
CCA members that provide fixed interconnected VoIP service in California that includes service to very small businesses should consult with telecom counsel and carefully review the PUC’s order and its attachment. You may also contact the CCA regulatory committee or Michael Pryor at mpryor@bhfs.com if you have questions.
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