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Friday, September 25, 2009, 05:00 pm PT (08:00 pm ET)

AT&T fires back at Google on net neutrality rules

AT&T has written the Federal Communications Commission's Wireline Competition Bureau to insist that any new net neutrality rules need be apply to everyone in the industry, including web companies like Google.

Google has helped lead the drive to impose net neutrality rules on cable and phone operators, in order to prevent Internet service providers from selectively blocking or slowing access to content or network applications from competitors. AT&T, which would be impacted by such rules both as broadband provider and as a wireless mobile company, maintains that Google itself needs to comply with the same regulations AT&T must if it wants to compete with telephone services like Google Voice.

An article published by Reuters reported that Robert Quinn, AT&T's senior vice president for federal regulations, wrote the FCC on Friday saying, "To the extent 'net neutrality' is animated by a concern about ostensible Internet 'gatekeepers,' that concern must necessarily apply to application, service, and content providers."

Quinn said Google has blocked its Google Voice users from placing calls to some phone numbers in rural locations in order to cut costs. AT&T, like other phone companies, are prohibited from selectively denying service to their users by regulations designed to guarantee phone access to all users regardless of whether it is profitable for them to do so. Without such regulations in place, much of rural America would never have been commercially viable for private phone companies to service.

Quinn said that "Google Voice thus has claimed for itself a significant advantage over providers offering competing services." His comments were echoed by USTelecom, a telephony trade group which issued a statement that accused Google of "effectively assuming the power to decide who its customer can call and what content they can access."

Google opts itself out of regulation

In reply, Google lawyer Richard Whitt told Reuters, "We feel comfortable that [Google Voice] is not a regulated service. It is a service that originates from an online platform." Whitt acknowledged that Google Voice was blocking calls, and said that "the company is doing that because certain local telephone carriers in rural areas charge AT&T and other long-distance companies especially high rates to connect calls to their networks."

Marguerite Reardon, reporting for CNET, explained, "Because they are small, rural phone companies are allowed to charge connection fees that are about 100 times higher than the rates that large local phone companies can charge. But in a practice known as traffic-pumping, some of these rural carriers are sharing revenue with adult chat services, conference calling centers, party lines, and others that are able to attract lots of incoming phone calls to their networks. The rural carriers charge the high rates and then split the revenue with these partners."

In its public policy statement on the issue, AT&T wrote that "A June 2007 FCC decision prohibits other providers, including those with which Google Voice competes, from taking such action [to selectively block calls]. Google has dismissed the Commission’s order, claiming that Google Voice 'isn’t a traditional phone service and shouldn’t be regulated like other common carriers.'"

AT&T insists that Google Voice is simply a "creatively packaged" service with the same features as existing FCC-regulated phone services. "By openly flaunting the call blocking prohibition that applies to its competitors," Quinn wrote, "Google is acting in a manner inconsistent with the spirit, if not the letter, of the FCC's fourth principle contained in its Internet Policy Statement. Ironically, Google is also flouting the so-called 'fifth principle of non-discrimination' for which Google has so fervently advocated."

"While Google argues for others to be bound by net neutrality rules, it argues against itself being bound by common carriage, which the Financial Times aptly recognized as an ‘intellectual contradiction.'" Quinn wrote. "Such a contradiction highlights the fallacy of any approach to Internet regulation that focuses myopically on network providers, but not application, service, and content providers."

He concluded, "the Commission cannot, through inaction or otherwise, give Google a special privilege to play by its own rules while the rest of the industry, including those who compete with Google, must instead adhere to Commission regulations. We urge the Commission to level the playing field and order Google to play by the same rules as its competitors."