Google Voice Rejection Ignites FCC Probe Into AT&T/Apple iPhone Exclusivity Agreement

Earlier this evening, word spread that the Federal Communications Commission is investigating Apple and AT&T regarding the recent rejection of Google's Voice application for the iPhone. At the heart of this investigation is the very nature of the exclusivity agreement between AT&T and Apple, and whether or not that agreement is hurting consumers, limiting choice, and hindering innovation.

According to reports, the FCC sent a letter to each of the three involved companies, in which contain all of the tough questions Slingbox owers have been asking since the SlingPlayer app for iPhone was apparently stripped of any ability to use AT&T's 3G network in order to be approved.

Here are just a few of the tough questions being asked:

  • Does AT&T play a hand in which apps ultimately get approved?
  • Does Apple and AT&T have standing contracts or agreements in regards to what apps can use the AT&T 3G network?
  • What are the standards for considering and approving iPhone applications?
  • Do any devices that operate on AT&T’s network allow use of other applications that have been rejected for the iPhone?

There are more... a whole lot more. TechCrunch managed to obtain copies of the three letters and posted them on their site in full. Hit up their site to read all the questions in full (trust me, it's worth the read).

While this probe was fueled by the rejection of Google Voice, the questions asked also allude to the FCC's interest in all apps that have been denied, in whole or in part, by Apple and AT&T. Depending on the outcome here, there may still be hope for a 3G enabled iPhone SlingPlayer, a full Skype app, Google Voice, and many more useful programs and services currently blocked from AT&T's 3G network or from the iPhone entirely.

No doubt Apple and AT&T will file for confidential treatment in this matter, so we may never know exactly what the FCC uncovers. What I do know is AT&T and Apple will be forced to sing a different tune, or things will continue status quo. I'm hoping for the former. Of course, I'd be much happier if Microsoft, Google, Palm, or anyone else put pressure on Apple and AT&T with innovative and open products that actually forced this dynamic duo to rethink their oppressive ways. Still, I'll take this in a pinch.

What do you think? Post your comments below.


I think it's a no-brainer. Of course they don't want Google Voice on there, especially over 3G or EDGE, just as the Skype app won't work on anything but Wi-Fi. If I could make calls from my unlimited Skype account over 3G, I'd never use any minutes, thus lowering their potential to make money.

It's interesting to see some high profile iPhoners defecting (i.e., Om Malik, Arrington are a few examples.)

I've complained about the draconian App Store and AT&T's crappy network enough... until they just changed something here in the burbs. Now I get flawless signal and no dropped calls at home... 4-5 bars and full 3G. Go figure. Maybe it won't last. That doesn't mean I'm not still thinking about the Pre, though. It would be easy for me to sell both my iPhones and switch.

They Won't change until competitors have a equal or better phone and open service. A phone capable of running a full Linux system would be nice.

Well, we all know it's about money here. The agreement between Apple and AT&T is meant to block certain applications from operating on the carrier's network where a competing product(In this case an application like Skype/Google Voice) allow the customer to circumvent the use of the carrier's service for voice communications which is part of how the carrier makes its money.

A few things bother me here, such as:
1. Using Skype or some other VoIP application doesn't always equate to the same level of access and quality that a regular cellular service can provide.
(so it seems to me that VoIP and Cellular Service are not 100% equivalent services and thus there is product differentiation here).

2. The carrier(AT&T) already makes money on both the Cellular call service as well as the 3G service which the customer is already paying for. Thus, this exclusive agreement between AT&T and Apple is to me, the same as having our ISP provider (for our laptop or home PC computer internet connections) tell us we can't use the internet for VoIP applications and we must use either our landline phones or cellular phones to make a voice call. Possibly due to one's ISP is either partly/wholly owned by a carrier such as AT&T and or there is some contract between the ISP and Carrier companies that restricts the use of VoIP.

To me, this is like trying to corner the market. Sounds similar to Microsoft saying that if you use a Microsoft OS, you can ONLY use the Internet Explorer application from Microsoft and no other Internet Browser from any other company.

This whole thing brings me to asking questions like: why so many people wish to 'jailbreak' and or 'Unlock' their iPhone? As, in the minds of the consumer who has flat out purchased the iPhone, they view the iPhone as their device to which they can do with as they please. By jailbreaking the iPhone, a whole slew of useful and interesting applications/functions are made available. Unlocking the iPhone allows the user to interchange which mobile carrier they use on the device.
Why is this wrong? it's the user's device. If the user decides to subscribe to multiple cellular carriers and pay the money for those services, then why can they not use their iPhone with the carriers interchangeably?

The reason: This forces the customer to purchase a whole new iPhone if they wish to have an iPhone on two different carrier networks. Equals to potential increase of Apple revenue. Equals mitigating the threat of competition from competing carriers from the current iPhone carrier's point of view. By not allowing VoIP applications decreases the threat of competition by companies(like Skype) to provide a similar service via VoIP that may cut into the carrier's profits from their cellular services.

So, government lobbying by these major cooperations like AT&T and Apple is a good thing? I don't think so. Free market and competition is what I believe it's all about. If a company can't be innovative and flexible to stay competitive, then the easy way out is to make all these draconian style contracts to try to protect themselves from competition, and thus limiting the flexibility of their products.

I would be very in favor of a divorce between phone makers and cellular service carries and have those carriers restructure their fees/services in order to stay competitive with other products/services such as Skype/Google Voice. Business/Technology is changing and businesses like AT&T need to keep up with these changes and be innovative. Otherwise make way. Will AT&T be another GM?



Connect With Techlore