WORLD: Skype's iPhone application raises protests

Publisher Name: 
Financial Times

Skype's application for
the Apple iPhone is igniting network neutrality disputes around the
globe after less than a week on the market.

The issue is
whether telecoms operators, which view Skype's mobile offerings as a
threat to their core business, can restrict usage of the iPhone
application on their networks.

Free
Press, a net neutrality advocacy organisation, on Friday asked the US
Federal Communications Commission to investigate whether AT&T was
violating US guidelines by preventing the application from running on
its 3G network.

An alliance of internet groups on Friday
responded to Deutsche Telekom and T-Mobile's threat to block the Skype
for iPhone application on its network.

The Voice on the Net
coalition (Von), which includes Google, Microsoft and Intel, called on
European regulators to ensure that consumers could access and run
smartphone applications of their choosing on any public network.

To
accommodate the boom in smartphone applications, telecoms operators
have begun handling an increased flow of data on their networks, mostly
without complaint.

But Craig Moffett, a telecoms analyst with
Sanford Bernstein, said the Skype for iPhone application represented a
threat to telecoms more ominous than overburdened networks.

"Where
the rubber really meets the road is voice over IP," Mr Moffett said.
"You can talk the talk about opening your network, but opening it up to
VoIP jeopardises your core business." 

The Skype for iPhone
application lets users make free calls to other Skype users and place
calls to landlines and other mobile phones at a low rate. Telecom
operators fear that a dramatic increase in mobile Skype usage could eat
into their revenues from minutes.

Net neutrality advocates argue
that blocking selective applications is disadvantageous to consumers
and stifles innovation. "Blocking of voice applications on mobile
devices, such as the announcement of T-Mobile to block Skype on iPhones
in Germany, is highly detrimental for consumer welfare in Europe," Von
said in a statement on Friday.

In its complaint to the FCC, Free
Press cited a comment made by AT&T's senior public policy
executive, Jim Cicconi, that it says is essentially an admission of
anti-competitive behaviour. "We absolutely expect our vendors not to
facilitate the services of our competitors," Mr Cicconi told USA Today.

Free
Press policy council Chris Riley said such behaviour was out of line
with the FCC's 2005 internet policy statement, which encouraged network
operators to allow consumers equal access to any application.

Blocking
the Skype application "is setting a dangerous precedent", said Mr
Riley. "We don't believe wireless carriers should be able to decide
what users can and can't do."

Although endorsed by the FCC, the
policy statement is not law, and as such is not enforceable. However,
net neutrality advocates believe the administration of President Barack
Obama could be more sympathetic to their concerns.

"Obama's technology policy since the early days of his campaign has started with net neutrality," Mr Riley said.

AMP Section Name:Technology & Telecommunications
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