14 November 2008

EU looks into telecoms blocking Internet calls

BRUSSELS: - 11 11 2008

European Union regulators are looking into whether mobile phone operators who block customers from making inexpensive wireless calls over the Internet are breaking competition rules.

The European Commission, the EU antitrust authority, has sent questionnaires to phone companies asking what "tools" they use to "control, manage, block, slow down or otherwise restrict or filter" Internet-based voice calls.

The EU deadline for responding to the survey was Tuesday. The questionnaire, obtained by Bloomberg News, does not identify any companies.

Some mobile carriers have blocked services that use voice-over-Internet protocol, or VoIP, which allows users to make calls over the Web. Companies may be seeking to stop customers from accessing applications, like eBay's Skype, to defend voice revenue from the less expensive Internet services, Carolina Milanesi, research director for mobile devices at Gartner, the research company, said.

"Mobile carriers are worried about the short-term impact and the cash cannibalization on voice calls," Milanesi said.

The commission "is closely monitoring the evolution of the VoIP market," Jonathan Todd, a spokesman for the commission, said in an e-mail message, without elaborating.

The commission uses such questionnaires as a basis for possible formal investigations or antitrust cases.

Marcel Smits, the chief financial officer of KPN, which allows users to access mobile VoIP services, said last week that there was no point in blocking the technology. Users will find a way around restrictions and operators will recover lost revenue, he said.

In addition, making a call using VoIP technology would increase data traffic, a potential source of revenue for the mobile-phone companies.

"These products really enlarge the market," Smits said. "People use Skype differently than they use their normal phone."

Smits said he understood operators' concerns about VoIP calls because they will eat into voice revenue. KPN has embraced the technology because it will lead to new services that customers want, he said.

Source - Herald Tribune

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