Google Responds, Calls For Intercarrier Compensation Reform

October 29th, 2009 by · 12 Comments

When AT&T (NYSE:T, news, filings) fired back at Google Voice, complaining to the FCC that it was blocking calls that AT&T was forbidden to block, the response from the blogosphere was rather incredulous.  It wasn’t the same thing, it wasn’t even related to last mile networks and thus network neutrality is irrelevant, and Google Voice isn’t even a real voice service.  I tried to make the point that AT&T wasn’t really trying to stop Google Voice, it was using Google as a foil to be heard on the topic of intercarrier compensation.  In its response, Google surprised me by not taking the the “we’re all-IP so obscure telecom regulations shouldn’t apply” line, they actually picked up the gauntlet.

First, the company narrowed the field to just 100 or so numbers that they believe are clear cases of traffic pumping, i.e. RLECs partnering with chat lines and other providers to abuse rural prefixes with high access charges to host high volume lines and split the proceeds that flow in involuntarily from other carriers.  They didn’t bury the issue under technicalities.  They didn’t back down, rather they isolated and clarified the real problem.  Second, they reiterated their previous somewhat impersonal call for intercarrier compensation reform to restore the proper balance.

In other words, they acknowledged that there’s something that needs addressing here and they didn’t bail on the issue by claiming they aren’t part of the telecom world.  They are going to make the new FCC a) actually fix the system or b) publicly endorse traffic pumping.  Will the FCC choose the option c) punt as they always have?  Or will the fact that Google and AT&T actually want the same thing here give Genachowski enough cover to push through intercarrier compensation reform?  As I’ve said a few times now, enforcing network neutrality without fixing intercarrier compensation is like putting up wallpaper over water damage.  We need a healthy regulatory framework from the top to the bottom.

So Kudos to Google for not ducking the issue or claiming immunity,  now let’s use this chance to find a permanent fix for once.

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Categories: Government Regulations · VoIP

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12 Comments So Far

  • Dave Rusin says:

    Decades long argument … three words … “Bill and Keep” … problem solved.

    No political will to to this.

    • Epoe says:

      Bill and Keep you mean drop the price of Unlimited Long Distance down to 1.70 like Magic Jack has and let them connect to the Public Switched Telephone Network for free!!!

      That can’t be good for Local Exchange Carriers

  • anon says:

    i cant imagine how this helps google sell online text and display ads…. their sole source of profits… seems like a fool’s errand to take on “intercarrier compensation” regarding legacy voice stuff.. who cares about any of this… the internet is the universal network and diving into legacy nonsense is a waste of time and resources.. the big bells have defeated clecs, ixc’s, rlecs, etc., and google is another speed bump

  • Epoe says:

    B and C are the same if they punt as they always have it will mean that they endorse it. Get it through you head they have always endorsed it.

    Google is selling a service below their cost and claiming they will not connect to high cost numbers. Aren’t all numbers high cost when you don’t charge.

    Can anyone see that Google is just collecting information as they always have. Does the FCC need to regulate to make that process cost less.

  • Dave Rusin says:

    Google gets zero under bill and keep because they are not a carrier – they are a VOIP player riding on the public internet for free … quality and reliability under bill and keep will trump their free ride on the public internet … this is what took time for Vonage to learn. Quality and reliability of the connection is important.

  • Frank Coluccio says:

    NYT: Why Google Doesn’t Like Its Phone Bill

  • carlk says:

    Mr. Rusin, is your Bill and Keep epiphany with or without telecom settlement features which were designed in a way, only to use an analogy, that oligopolies keep their oil prices high with no regard to real or factual costs to produce nor the freedom to price their services lower, for whatever reasons?

    You’re too smart of a man, so I must assume your idea is confined strictly to your three words.

    Let me see if I may take this a step further. If Bill and Keep without archaic laws left over from a dinosaur era, one which continues to create jobs for regulators while supplying numerous government entities in the form of collecting undue taxes, fees, etc., internet traffic including voice will migrate to, both at origin and termination, the low cost provider.

    Who are they(low cost providers), and why shouldn’t they exist ?

  • anon says:

    i am still hoping that someone will address my question: why does any of this matter to google.. there are all sorts of weird, legacy industry anomolies in the world… Google sells Ads for a living.. that’s how they make money… why hire lobbyists and waste time and money on one legacy regulatory oddity that impacts companies trying to preseve over-charging for 1’s and 0’s that = voice streams, as opposed to other 1’s and 0’s. perhaps next they will waste resources fighting over Dept of Agriculture subsidies???

    • Dave Rusin says:

      Even the failing NY Times understands …

      On one side of the fence, they peer VOIP for FREE on the other side, when they have to pay TDM termination charges that’s wrong … welcome to telecom Google.

      Like I said, bill and keep incents rural folks to go more efficient with IP which stops the traffic pumping because the VOIP part of a transmission is an INFORMATION SERVICE which is not regulated. Otherwise we keep pumping money down a hole in rural areas. Rural carriers that adopt IP can now value-add to their customers something TDM does not allow readily.

      As the NY Times article states, ATT et al have been after this for years … welcome Google … now because Google complains things need to change for Google? What % of voice traffic do you think Google has … minuscule.

      Google is out protecting its Ad business … and its distributed architecture that creates a barrier to competition.

      I am looking for “Google neutral Searching” and “Google neutral Ad placements.”

      Google fights the terminating access because in theory, if Congress changes a few things as they become in need of cash once tax payers are bled out, they don’t want IP termination charges that would affect their model … same reason why they want network neutrality — it protects their Ad business.

      • DaveRusin says:

        Interesting follow-up — I read yesterday where the CEO of Google is back-peddling on net neutraliity … he does not think it would be a good thing to have the government regulatingg the internet …

  • carlk says:

    Why do the Masters of the Universe continue attempting to bury the “changing business models” suggesting new growth vehicles in the CDN space that Sunit, etal, have been presenting including ad and subscription based models?

    Ballmer’s going to blow a head gasket! Let the bidding wars begin, and I hope Crowe has the last laugh on Vint Cerf regarding how marbles should be exchanged and traded in the school playground which gets damn rough from time to time!

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