FCC probes iPhone-Google app dispute

Eric Schmidt, Google’s CEO, resigned from Apple’s board in early August, after regulators from the Federal Trade Commission began questioning whether his dual role would make it easier for the two to collude in ways that would diminish competition.

In its response to the FCC’s queries, AT&T told federal regulators Aug. 21 that it’s not privy to Apple’s iPhone application vetting process and played no part in blocking Google Voice. AT&T said the two companies have discussed a handful of programs, but not Google’s.

Apple’s iPhone apps store on iTunes set off a wave of similar digital shops from competitors, including Microsoft Corp. and BlackBerry maker Research in Motion Ltd. Outside software developers sign up to get the programming tools necessary for building applications, then submit them for review and sale on a central site.

Apple has been quiet about the details of its vetting system, which has been criticized as a “black box” by developers whose apps have been rejected. Some say they submitted applications and waited months, only to be rejected without much of an explanation.

The backlash has grown as some programs have slipped onto the app store that have raised eyebrows–including one game that mimicked a wailing baby and required users to shake the iPhone to extinguish the cries.

In its letter to the FCC, Apple disclosed some aspects of its review process. The company said it gets about 8,500 application submissions a week–some brand-new and some updates to existing programs. Apple said more than 40 people work full-time to review the apps, and that at least two look at each one. The team reviews 95 percent of them within two weeks, and about 20 percent are not approved on the first try.

Apple said most of the rejections are owing to glitches in the application itself, but that it also rejects programs that “degrade the core experience of the iPhone.”

Google told the FCC that iPhone owners can use a web browser version of Google Voice, but its features are limited. Google’s response was redacted to cloak Apple’s explanation for the rejection, and Google had no immediate comment on Apple’s claim that it is still considering the program.

Apple and AT&T’s letters also laid out their agreements regarding Voice over Internet Protocol, or VoIP, programs for the iPhone. Such services let people make calls using Wi-Fi or the cell phone data network instead of using up calling minutes.

AT&T said that under their agreement, Apple would not approve a VoIP app without AT&T’s consent. As time went on, AT&T said it told Apple that it does not object to VoIP programs that use Wi-Fi. Apple has approved VoIP applications from eBay Inc.’s Skype, among others, that work over Wi-Fi.

Apple said in its letter that it does not know if Google Voice uses VoIP.

In its letter, AT&T said it plans to take a “fresh look” at authorizing VoIP programs that use its 3G data network.


Federal Communications Commission

FCC’s Wireless Telecommunications Bureau