AT&T Fires Back at Google on Net Neutrality
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AT&T said any new "net neutrality" rules imposed by US regulators need to apply to Web companies like Google as much as to phone companies to ensure a level playing field.
In a letter Friday to the head of the US Federal Communications Commission's Wireline Competition Bureau, the biggest US telephone company argued that Google would have an unfair advantage if its Voice service is not subject to the same rules proposed by the FCC on phone operators.
"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," Robert Quinn, AT&T's (NYSE: T) senior vice president for federal regulations, wrote to the FCC's Sharon Gillett.
Last week, FCC Chairman Julius Genachowski proposed new rules requiring operators to open their networks to any legitimate Internet content or service without discrimination.
If adopted, the rules would be a victory for big Internet companies like Google (NASDAQ: GOOG) at the expense of network operators like AT&T, Verizon Communications, Sprint Nextel Corp and T-Mobile.
Broadband carriers such as AT&T and Verizon Wireless have argued that existing net neutrality guidelines were sufficient and should not be codified into a rule. They argue that they need the ability to protect their networks from bandwidth-hogging applications.
T-Mobile is a unit of Deutsche Telekom AG. Verizon Wireless is a joint venture between Verizon and Vodafone Group Plc.
A lawyer for Google said the company's Voice service application is a Web software tool and should not be regulated like telephone companies.
"We feel comfortable that it is not a regulated service," Richard Whitt, a Washington D.C.-based lawyer for Google, told Reuters. "It is a service that originates from an online platform."
The FCC said it had received AT&T's letter and was reviewing it.
A Google Voice Advantage?
AT&T cited media reports that Google Voice was blocking some calls to phone numbers in certain rural areas in order to cut down on expenses. Phone companies are banned from blocking calls.
"Google Voice thus has claimed for itself a significant advantage over providers offering competing services," AT&T's Quinn said.
USTelecom, a trade group representing service providers, sided with AT&T in a statement, accusing Google of "effectively assuming the power to decide who its customer can call and what content they can access."
AT&T disputed Google's argument that Google Voice is not a traditional phone service and should not be regulated like one. AT&T described Google Voice as a "creatively packaged" offering similar to phone services that are regulated by the FCC.
"As such Google Voice would appear to be subject to the same call blocking prohibition applicable to providers of other telecommunications services," Quinn said in the letter.
The carrier also argued that even if Google Voice is classed as an Internet application, it should still be subject to rules requiring it to embrace competition, according to the FCC's fourth principle in its Internet Policy Statement.
"By openly flaunting the call blocking prohibition that applies to its competitors, Google is acting in a manner inconsistent with the fourth principle," Quinn wrote.
AT&T also argues that Google is flouting the FCC's recently announced non-discrimination principle by blocking calls to local phone operators in certain areas.
Google shares closed 0.9 percent lower at $492.48 on Friday, while AT&T ended 0.3 percent down at $26.96.