Apple and AT&T’s Colluding, Anti-Competitive Ways

By  |  Monday, August 24, 2009 at 1:38 pm

Metallica And Justice For AllApple, AT&T, and Google’s responses to the FCC inquiry have received plenty of coverage. So I’m not going to rehash those letters line by line. However, I did want to focus on the Net Neutrality angle. Perhaps, the crux of the matter. And while I may not know the legal standards or thresholds for collusion and anti-competitive practices, as a frustrated customer of both AT&T and Apple, that’s exactly the perception I’m left with.

Apple says that they make final decisions on all App Store approvals. Except when AT&T has “expressed concerns.” Or when bound by the conditions of their contract with AT&T.

The parties state that VoIP apps (like Skype) are blocked from AT&T’s data network to protect the pipe. But they’ve had no problems approving music streaming services, which could actually consume more bandwidth than a VoIP app and possibly for longer periods of time. Related, AT&T uses language to prevent customers from redirecting a TV signal to a mobile handset. Which is why Slingbox iPhone client has been crippled/restricted to WiFi usage. Yet AT&T upsells mobile TV video services (starting at $15/month) on many handsets and the iPhone facilitates baseball game video streaming (also for a fee). Content which is obviously destined for TV, given the simulcast commercial breaks of silence.

So I’m calling BS on their FCC responses. I pay $30/month for data access. And it seems to me that Apple and AT&T are collaboratively and selectively blocking apps that could compete with their own service offerings. The app that triggered this investigation isn’t even a “bandwidth hog” and doesn’t provide VoIP connectivity. However, it does allow me to make phone calls at better rates than AT&T offers. Bottom line: If AT&T (and Apple) were solely concerned with protecting their network, they’d institute bandwidth caps and/or maximum streaming bitrates/resolutions. But, as it stands, the wireless industry is protecting their antiquated business model and needs to grow up evolve. We customers are ready. These two providers clearly aren’t.

[This post is republished from Zatz Not Funny.]


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8 Comments For This Post

  1. Anon Says:

    Wait, what do you mean by Google Voice “doesn’t provide VoIP connectivity” ? Of course it does, but your point is still valid that data is data and if we pay for data they shouldn’t limit what we do with it.

  2. DaveZatz Says:

    Google Voice does not route a call direct from an iPhone to a distant number. Google essentially calls your local phone and calls the remote phone and then links the two. There’s VoIP, but it’s not using AT&T’s data network it’s using AT&T’s cell network. I’m sure they could go totally data, but we’ll start with the smaller battles we’re more likely to win. 😉

  3. Anon Says:

    So if I place a call via Google Voice on an iPhone, am I paying per-minute for the voice/cell use on the iPhone?

  4. DaveZatz Says:

    It depends on that app and the platform. I suspect on the iPhone, as long as it’s locked down pretty tight and doesn’t allow third party multitasking/background apps, you’d most likely tell Google Voice what number you’d like to call. That info would be sent to Google over the data network. Then Google would call your cell phone and the number you wanted to reach and merge the two. Your phone would ring on AT&T’s voice network – so you’d use domestic US minutes. EVEN if “calling” overseas, for example. This is how it works now if you use Google Voice on the iPhone via the web page. You’d probably end up using data for listening to voicemail though – a truer VoIP experience.

    Google Voice for SMS is VERY interesting. And probably even more scary for AT&T. You’d send via the data plan, so for “free”. Receiving *could* be “free” if they implemented push notifications.

    Many scenarios are possible. I’m hopeful that the FCC even taking a look has AT&T and Apple reevaluating how they’re going to handle this sort of stuff going forward. And if they don’t do the right thing before the HTC Hero launches on Sprint it may be too late for them to keep me around.

  5. Hamranhansenhansen Says:

    > Apple and AT&T’s Colluding, Anti-Competitive Ways

    … are not nearly as bad as everything Verizon does, and yet results in better phones and happier customers.

    For example, for an iPhone to run on Verizon, Apple would have to do all the same things they do for AT&T, PLUS they would have to pull the GSM hardware and antennae from the iPhone and put in Verizon hardware and antennae and they would have to put on the Verizon app store and so on. The Verizon iPhone would not run in China or Europe or Canada when you visit (like the current iPhone) because no Verizon there, it’s only in the US. Even when you finish your Verizon contract, you can’t run your Verizon phone anywhere but Verizon, you can’t sell to anyone but a Verizon user. Recently I sold my original iPhone that I bought from “colluding, anti-competitive Apple and AT&T” to a guy in Italy who is running it there now. Not possible with any other US carrier.

    I hate the cell phone industry, too. I just think it’s a little strange that Apple is at the top of everyone’s hit list like they invented the industry and all it’s problems. They are the newest player, and they’ve worked around the industry very well, redefining it in some ways. They are the ones who brought in open Unix core OS and open HTML 5 API as standards on smartphones. They are the ones who brought a desktop-class native platform to a smartphone for the first time. They are the only cell phone platform with universal Wi-Fi and quarterly software updates and instant patches and many, many more sophisticated computing features that you don’t even find on most desktop PC’s.

    I mean, when you talk about anti-competitive and cell phones and the US market, if “Verizon” and “Sprint” and “CDMA” aren’t the first things out of your mouth then you’re being disingenuous. They are not even part of the global phone network. You can’t make a call and access the Internet simultaneously on these proprietary networks. No international travel, no SIM’s, no moving your phone to another network no matter what, and features pulled out of your phone by your handset maker at the whim of Verizon or Sprint.

    I mean, we’re talking about AT&T being protective of its network bandwidth and possibly having something to do with a handful of apps like Skype and iTunes (yes even Apple’s iTunes) being limited in what they can do over 3G. That is nothing compared to your phone coming with its Wi-Fi antennae missing or disabled because Verizon said so.

    Let’s get REAL. I call BS on this Apple-bashing. Everybody else is worse.

  6. Anonymous coward Says:

    I will never understand Americans discussing mobile telephony.
    Dave Zatz is *perfectly* right when he says “the wireless industry is protecting their antiquated business model”. But the AT&T/Apple thing is just a particular case of a *much broader problem*. This is true in every single country on Earth, and the bad guys are the operators. They are desperately trying to continue with their business model based on overcharging the customer, and they will do everything not to become a simple pipe. There are things which can help, like more competition (but all three GSM carriers in my country sell iPhones and Phone-specific plans, and iPhones can be bought without a plan too, so in my view iPhones are irrelevant here, also because blocking third-party VoIP or overcharging not carrier-initiated streaming is a common practice independently of the handset), smart regulation, etc. A bit smarter customer base could also help: I use Jajah on my mobile phone and my monthly bill is ridiculously low, and I make around 200 international calls every month.
    It’s Hamranhansenhansen who puts things into perspective, you need to talk CDMA, TDMA, GSM, 3G, Qualcomm, nobody ever mentions Qualcomm!, etc etc to understand the historical reasons of this mess and how we can get out of it. It will be a slow process.
    Sorry for my poor English. Ciao.

  7. DaveZatz Says:

    Hamranhansenhansen, AnonymousCoward – I agree completely this issue is much larger than AT&T and Apple. However, that’s who I’m currently a customer of and who the FCC has sent inquiries. Not sure I’d go as far as saying CDMA is a problem, but Verizon is notorious for locking down their handsets (such as the storied past of blocking third party nav apps on Blackberry devices) and it’s true they haven’t embraced WiFi handsets.

    But back to AT&T, they’ve also blocked Sling’s Finder ID service in the past (before updating their terms of service to prohibit tv streaming) and my work aircard was blocked from using my company VPN. I know my limit is 5GB, leave it to me to manage that number instead of forcing me into a higher tier of service designed to gouge business customers.

    Of course, I also speak with my checkbook. I dropped my AT&T card for Sprint. And if the HTC Hero hits before Apple and AT&T rethink their policies, I’m jumping to Sprint for that too.

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