So What's Up With That FCC Investigating Apple and AT&T Blocking Google Voice — Oh Wait, They Aren't . . .

So while I was gone, Apple and/or AT&T turned down Google’s effort to get a Google Voice Application certified for the iPhone, so the FCC launched an investigation into the matter.

Except they didn’t. Not exactly. Which is extremely important on the delicate question of FCC authority. Actually, the FCC invited three companies involved in a very high-level spat on an issue pending before the FCC in two proceedings to provide them with useful information on how the market actually works.

I know, I know, this is all boring legal stuff that folks who care just about outcomes hate with a passion — or think is just cheap legal handwaving. But these things matter, both as a matter of law and and as a matter of policy. The fact is that the FCC is very carefully not exercising authority over anyone. The companies don’t even need to respond. However, if they fail to respond, they invite the FCC (and the rest of us) to assume the worst. Because allowing industry folks to foreclose needed agency action by simply refusing to provide necessary information is a crappy outcome we’ve lived with for the last 8 years (longer, really). Far smarter to invite industry folks to respond to questions, but decide that at some point you need to move with the information you have. Heck, if the FCC pulls that trick only once, I bet we’ll see lots more folks with relevant information willing to come forward.

So while I expect lots of folks to yammer about FCC authority on August 21 when the answers are due, they’ll be barking up the wrong tree. Won’t stop ’em, of course. But for those who would like a sense of what is actually going on from a legal/regulatory authority angle —

More below . . . . .

First, lets get to the letters themselves. Here’s the letter to AT&T, the letter to Apple and the letter to Google. My, don’t they ask a lot of questions and look very official. But the attentive lawyer notices the following:

1) These letters come from the Wireless Bureau, not the Enforcement Bureau. Unlike, for example, the investigation into complaints about alleged cable misconduct last fall, these are not letters of investigation but simple requests for information.

2) They reference two already existing proceedings. RM-11361, the “Skype Petition,” and RM-11497, the Petition to ban handset exclusivities filed by the Rural Carrier Association. As the opening paragraph of each letter makes clear, the story that either Apple or AT&T (or both) rejected the Google Voice ap for anticompetitive reasons would seem to have relevance to either or both of these proceedings. As the letters all say, the Bureau is therefore “interested in a more complete understanding of this situation.”

3) The letters do not invoke any of the FCC’s statutory authorities to compel a response — which is standard procedure if the FCC is actually compelling a response. Instead, the letters merely describe how the parties can seek to have their information declared confidential.

So, there is no FCC investigation into the incident. The principle parties are, however, each invited to answer a bunch of questions the Wireless Bureau thinks would prove very helpful in assessing two open pending rulemakings. Indeed, the FCC has actually prevented more radical folks, such as yr hmbl obdn’t blogger or my far more prolific allies at Free Press, from writing to demand an actual investigation or file a fresh complaint of our own. By getting out in front and demanding (inviting, really) explanations and elaboration on key aspects of industry structure, how can we in the open networks camp do other than applaud? We can hardly fault the FCC for failing to act — nor can we complain that they have not acted vigorously enough unless the parties simply refuse to respond. In which case the FCC can go ahead and decide these two pending rulemakings based on the records (and authority) they do have. Rather than an outrageous over-extension of Commission authority to applications (as I expect some to call it), this becomes a clever move that spikes our guns from demanding just that.

I give a tip of the hat to Acting Bureau Chief Jim Schlichting (with, I expect, a nod to incoming Bureau Chief Ruth Milkman and Chairman Genachowski) for getting out in front of the curve in such an artful way. Such handling bespeaks a clever subtlety that commands some professional respect — if a bit of unease on my part as an advocate with a dog in this fight. Still, from my perspective, this is probably the best course, as it does not create a side issue about overreach. Any party that refuses to answer because the FCC lacks jurisdiction is free to say so without repercussions or genuine challenge to the FCC’s authority because the FCC did not purport to exercise any authority. (Even AT&T, and entity over which the FCC has clear authority pursuant to the Title III licenses AT&T operates, was not compelled to respond, neatly sidestepping any question as to whether this falls under the FCC’s Title III, Title II (via Section 332) or Title I authority.) And Google, a supporter of both rulemakings, can answer as fully as it likes without fear that it is somehow placing itself under FCC authority by responding.

Of course, this will not stop a passel of folks from claiming that the letters are an assertion of authority and an inappropriate one at that. Indeed, Apple may make such an assertion (although I expect them to be smarter and provide some answers while also saying they do so voluntarily and to assist the FCC because regulating Apple would fall outside the FCC’s jurisdiction). Some folks making the assertion will no doubt be genuinely confused by these legal distinctions. Others will bellow loud assertions about an outrageous overreach of FCC authority for the same reason folks in the healthcare debate yack on about “Death Panels” — it’s good theater to try to gum up the works entirely. Of course, the very same folks would protest with equal vigor if the FCC had tried to draw conclusions from the press or from filings submitted by third parties and had not tried to get information out of Apple, AT&T, and Google — as they did when the FCC made it’s decision in Comcast/BitTorrent without compelling more information from Comcast.

We’ll have to see what happens next. I’m hoping the FCC will send a clear message to industry that they can’t have it both ways. Yes, the FCC will ask very specific questions to inform itself about situations in the popular press. But you can’t veto progress by refusing to answer. A data driven FCC needs data, and if those who have the data refuse to provide it they have no one to blame bu themselves if they don’t like the results.

Stay tuned . . . .

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3 Comments

  1. Brett Glass says:

    Harold, you’re splitting legal hairs. Legally, you do not have to show ID at an airport when asked, either. But if you don’t, expect to be hassled and probably not to make your plane.

    The same is true in this case. No, the FCC doesn’t have the authority to regulate Apple. If it were, it would also be allowed to regulate other vendors of closed computing platforms that include telecommunications capability. (Can you say XBox, PS3, or Wii, anybody?) And you can bet that it would soon assert its authority to restrict or ban games such as “Grand Theft Auto.”

    The companies really have no choice but to respond, and then — if the FCC seeks to become the Federal Software Commission — challenge this vast overreach in court.

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  3. Stearns says:

    It seem to be promising the right result:

    Apple admits their agreement with AT&T requires them to block voip, but that they have not — yet — rejected the Google App.

    AT&T says they are reconsidering their policy.

    http://www.usatoday.com/mon

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