More Telcos Blocking

Jim Thompson dug up some background that indicates that the telcos blocking are losing money due to various free conference call services using loopholes in telephone termination fees, and are suing.
“This is just the latest in a long line of get-rich-quick schemes that bilk others to make a profit,” said an AT&T spokesperson. The lawsuit claims that operations like FuturePhone’s are in violation of several statutes, including Iowa state laws as well as previous FCC decisions.

AT&T’s ‘Free Call’ Bill: $2 Million, by Paul Kapustka, Wednesday, February 7, 2007 at 5:00 AM PT

The rural ISPs involved say that what they’re doing is perfectly legal, and they’ve countersued:

While AT&T’s legal actions (and a similar move by Qwest) have forced several of the service operators out of business, the Iowa telcos aren’t going to be pushed around so easily, and have found formidable legal help themselves. Jonathan Canis, attorney with Washington-based Kelly Drye & Warren LLP, which is representing the Iowa telcos, says this latest tussle is reminiscent of AT&T’s legal battles with CLECs earlier this decade, a matter he says the telco giant ultimately settled out of court.

“This is deja vu all over again,” said Canis in a phone interview Monday, asserting that there is “tons of [legal] precedent” to prove that the rates charged by the telcos were legal, and that AT&T is, as the lawsuits claim, “deliberately flouting its legal obligations” by both not paying its bills, and by seeking redress not at the FCC (where the telcos claim such complaints belong), but through the courts.

Iowa Telcos: AT&T Owes $12 Million, by Paul Kapustka, Monday, February 26, 2007 at 2:41 PM PT

Some of the affected conference call services have not been organized enough to counter sue, and have shut down.

Of course, some telcos can’t leave well enough alone:

But Qwest executives indicated earlier this month that “untoward” and “inappropriate” traffic on its network had cost the company $10 million to $15 million.

Phone scheme cost it millions, Qwest alleges, Calls were routed illegally, it says in Iowa lawsuit, By Jeff Smith, Rocky Mountain News February 23, 2007

Even better:

AT&T spokesperson Mark Siegel said the company is blocking “certain numbers” for conferecing services, including’s, an action it feels appropriate under its wireless terms of service agreements. AT&T’s wireless service, he said, is for calls “between one person and another person, not between one person and many.”

Cingular, Qwest blocking ‘Free’ Calls, by Paul Kapustka, Thursday, March 15, 2007 at 10:35 AM PT

So what will happen on a non-neutral Internet when these same telcos decide someone has started a service that provides an “inappropriate” service, or that involves too many participants (like World of Warcraft or BitTorrent or blogging or lobbying for a position the telcos don’t like)?