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


Apple, AT&T, and Google‘s responses to the FCC inquiry have received plenty of coverage. So we’re 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 (with free outbound SMS). 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.

8 thoughts on “Apple and AT&T’s Colluding, Anti-Competitive Ways”

  1. There’s a second issue here as well… why is Apple a gatekeeper for software I want to load on my device? They say the iPhone runs the same OS X on my laptop. Yet I don’t have to buy apps solely from Apple for my Macbook. Nor do they get to approve what I choose to run. As Harry McCracken asks, I too wonder whose iPhone is it? Maybe these guys have forgotten how the EU and DOJ worked to separate IE from the OS to enable competition.

  2. The good news is that this is churning up a lot of turmoil towards a company like Apple that is very sensitive about its public image. For years the carriers have been restricting features as simple as BlueTooth on the sets they sell and limiting purchasing ring tones from their web site only,etc, etc. Public outcry never made a dent in their thick hides. But Apple likes to look shiny!

    So maybe the airwaves will begin to finally open up for many new features previously capped by AT&T with the help of Apple and their other international carriers/partners making them available.

  3. It’s funny how AT&T says they didn’t tell Apple to reject the GV app. Of course they didn’t have to tell them since it is in AT&T’s contract with Apple. Reading those responses reeks of BS statements. If Apple and AT&T were honest, I doubt the FCC could do anything. It seems their responses are just asking for more FCC criticism though.

  4. Ok this is one thing I have been thinking about lately. AT&T now sells netbooks with 3g connection, I bet you can add skype and sling onto those and be able to use any of them with little to no problems.

    So what’s the how is my iPhone any different? I can kind of understand on letting skype use wifi just so your not using skype instead of your AT&T minutes, I guess. But then why let yahoo, aol, ect add their messenger so you can text you friends without useing text minutes?

    I do agree Dave, Apple should just make sure that the apps that come though the app store are not carrying any viruses, ect. And AT&T just needs to become “dumb pipes”.

    Also on a side note to this post. I hope you got permission from Metallica to use the cd cover, I would hate to see you feeling the wrath of Lars Ulrich ;).

  5. I wondered if/when we’d get a comment on them. ;) Fortunately, I very specifically chose the album art linked to an Amazon affiliate code – so, in theory, I’ve stayed within Amazon’s TOS here and am basically reselling the CD instead of merely swiping the image I wanted to use.

  6. hmm, when cable companies, a REAL monopoly, impose bandwidth caps, it is for true quality of service issues; but when AT&T, which at least competes against Verizon, imposes limits it is for anti-competitive reasons….

  7. @Charlie

    Cable companies are not monopolies. They are franchised utilities, just like water, power, mass transit and sewer.

    Your municipality entered into an agreement with your Cable provider that allowed tax incentives and wiring rights to the Cable operator in exchange for hefty franchise fees, job creation and improved communication services for the community. If you have an issue with your cable provider you need to take it up with your city council.

    Further, Cable companies are heavily restricted by the FCC to have no more than 30% of HH to specifically prevent them from becoming monopolies.

    On the flipside, ATT is using massive size, oppressive subscription contracts and a true monopoly on the iPhone to stifle the competition.

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