Skype to regulators: Push mobile operators to allow VoIP

Open Internet access will be a key driver for mobile operators' revenues, said a Skype executive

Skype, the Internet telephony provider, Thursday urged regulators in Europe to intervene to ensure that users aren't blocked from using their mobile phones to access much cheaper phone calls via the Internet.

As the U.S. Department of Justice turns up the heat on mobile phone operators that try to exclude Internet telephony services such as Skype from being accessible on their networks, Europe appears to be doing the same.

This measure comes not a moment too soon, said Stephen Collins, Skype's director of government and regulatory affairs, in a phone interview.

Telecom Commissioner Viviane Reding last week warned T-Mobile, the mobile arm of German telecom giant Deutsche Telekom, that she wouldn't tolerate discriminatory behavior that tries to block VoIP providers from expanding in the mobile phones market.

The Commission is taking "a close interest" in T-Mobile's stated intention "to block by way of contractual prohibitions the use of Skype Internet telephony services," Reding said in a written reply to a question by Socialist European parliamentarian (MEP) Christel Schaldemose.

"Discrimination of Voice-over-IP services by operators with significant market power must not be tolerated by national regulatory authorities," she said, adding that the roaming regulation that came into effect at the beginning of this month specifically outlawed such discrimination.

European antitrust laws also forbid exclusionary conduct that harms competition. Competition Commissioner Neelie Kroes told MEPs in May that her department has been monitoring the conduct of mobile network operators with respect to new Internet-based services such as mobile VoIP since early 2008.

No formal antitrust probe has been started yet. Kroes' spokesman, Jonathan Todd, said in a telephone interview Thursday that antitrust officials are "keeping an eye on the matter."

Skype's Collins said mobile operators were shooting themselves in the foot if they tried to prevent VoIP providers from offering their services via mobile phones.

"We find it odd that T-Mobile would seek to block or discriminate against users from accessing Skype on their iPhones or other handsets. If they want to develop successful mobile data networks they should be encouraging people as much as possible to use their mobile devices to access Internet applications and services," he said in a phone interview.

He likened the approach of mobile operators to AOL, which in the early 1990s restricted its subscribers from having full Internet access, offering them what is often called a walled garden offering instead.

It worked for a while but eventually subscribers switched to ISPs that allowed full Internet access, Collins said, adding that he expects the same thing to happen with mobile Internet.

"Eventually all the mobile operators will get the point that open Internet access will be a key driver of data revenues for them, but they may need strong encouragement from Madame Reding and national authorities before they actually do the right thing for consumers."

The DOJ said last week it is investigating whether mobile operators are abusing their market power. One possible abuse, it said, was the restricting of certain services including Skype's mobile VoIP service.

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