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AT&T Relents, Opens iPhone to Skype, Voip

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Bowing to openness pressure from the FCC, AT&T renounced on Tuesday its opposition to internet telephone calls that use the iPhones 3G data connection.

In short, Skype on the iPhone is now OK by AT&T, the company said in letters to Apple and the FCC.

AT&Ts change of heart comes just after the FCC controversially announced that it was planning to extend internet openness rules to mobile networks. The wireless carriers are fighting back, arguing that wireless networks are not robust enough to operate without intense network management.

AT&T made no mention of the FCC in its announcement, crediting the change instead to a routine examination of its policies.

IPhone is an innovative device that dramatically changed the game in wireless when it was introduced just two years ago, said Ralph de la Vega, AT&Ts president of Mobility & Consumer Markets. Todays decision was made after evaluating our customers expectations and use of the device compared to dozens of others we offer.

Now the only thing standing between iPhone users and VoIP applications is Apple and its inscrutable app-approval process.

Apple and AT&T had a secret agreement to ban apps that would let iPhone users make phone calls using the wireless data connection, a fact that was revealed this summer when the FCC asked the duo to explain why Googles innovative Voice app was rejected for the iPhone store.

So for instance, Skype, the worlds most popular phone service, had to cripple its application so that it would only work when an iPhone was using Wi-Fi. Skype users can call each other for free, and Skype international calls are substantially cheaper than ones placed through a traditional carrier.

The iPhone store is the only way to install apps on Apples category-defining device without voiding the warranty, which led the FCC to investigate if AT&T and Apple were colluding to prevent competition.

In a bit of hairsplitting, AT&T has long maintained it doesnt block Skype which has uncrippled apps that run on other phones the company sells. Instead, its just had Apple block the application. AT&T likely fears that Skype users will opt for plans with fewer voice minutes if they can bypass AT&Ts voice channel, but that fear seems to have given way to a greater one new regulations from an emboldened FCC.

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