Will Google Voice Become FCC Regulated Because of Adult?

MOUNTAIN VIEW, Calif.—As far as Google is concerned, the future of Google Voice, its new phone management service, is very much tied to its regulatory status; in other words, a decision by the Federal Communication Commisssion (FCC) to treat Google Voice as it does other common-carriers threatens to stifle innovative technologies just like, well, Google Voice.

"Imposing legacy common carriage requirements would be unfortunate not just for Google Voice, but also for lots of innovative companies, large and small, who are using the Web to revolutionize the way people communicate with each other," Richard Whitt, Google's Washington telecom and media counsel, said.

An article in the Wall Street Journal explores just this issue as the search giant attempts to do for phone service what it is doing for—or some would say, to—the newspaper industry; namely, aggregate everyone using the service under its roof.

A free service, Google Voice allows people to link all of their phones to a common number and manage calls and SMS messages through a website, among other services.

According to the article, “The FCC's first look at Google Voice came earlier this year, when the commission asked why Apple Inc. (AAPL) rejected the application for the popular iPhone. Apple said it is still considering Google Voice for its iPhone application store, a response that appears to be satisfying regulators for now.”

The article cites a specific potential stumbling block for Google’s argument that its service is non-traditional and should not be regulated like common-carriers such as AT&T, Verizon or Qwest.

“One issue for the FCC: Google reserves the right to restrict calls to certain telephone numbers, such as adult chat lines or free conference-call centers that have overly high access charges,” writes Fawn Johnson of the WSJ, who argues that the traditional carriers will certainly cry foul if Google is allowed to block those kinds of calls.

“Several years ago, AT&T and others tried blocking calls to lines with inflated access charges,” writes Johnson. “They were rebuked by the FCC, which said common-carrier phone companies can't pick and choose the numbers they will patch through and those they will block. Verizon, AT&T, Qwest, and Sprint Nextel have [all] protested smaller carriers' ability to route popular numbers through high-cost areas, forcing them to pay several times the average rate for connecting customers' calls.”

Because Google Voice is so different from a traditional phone service, though, and actually amalgamates features that are all subject to different rules, the FCC has had to step back and assess the new feature in a new light, something it has done before with the advent of internet-based services such as Skype and Vonage.

“The FCC said in 2004 that voice-over-the-Internet phone services, or VoIP, aren't subject to state regulations, but it didn't offer much clarity in terms of how federal regulators should look at VoIP services,” said Johnson.

According to the FCC, agency decisions going forward will be data-driven and consumer-oriented with respect to services like Google Voice. "We're moving to a broadband world and we want to maximize innovation and investment in the space," FCC Senior Counselor Colin Crowell said.

That’s all well and good, says the WSJ, as long as that innovation doesn’t take too much market share away from the traditional carriers. “Google may be pushing the boundaries in terms of how people think about using telephones,” it warns, “but Bell-era phone companies will push back if their business is affected.”

Regulators may indeed be reluctant to impose their will on new services and risk squelching innovation and progress, and their expectation may correctly be that all phone service will be internet-based in the future, but as with rules regarding sex chat rooms and other similar requirements, if the playing field remains uneven because some companies are regulated while others are not, the whole thing could wind up in court for years to come before a happy compromise is reached.