The Google Voice battle: What is Apple afraid of?

In the 1980s, we wanted our MTV. These days, we want our IP-based telephony, we want it at home and on the go, and we don't want to get ripped off in the process. Apple either hasn't gotten the message or has chosen to ignore market reality, and it's a mistake that in the long run could cost it dearly.

By now the facts are well known: Apple last week rejected the official Google Voice Application for the iPhone from its online App Store, and removed a whack of third-party applications that relied on or connected to the service. Apple's lame excuse? The app offered functionality already available on the device.

The reality? Apple and its carrier-partner in crime, AT&T, are afraid of losing revenue to any IP-based telephony service that threatens to undercut the age-old model of forcing consumers into rate plans that were already gathering dust when landlines rules the market and long distance was considered a luxury.

A pox on playground bullies

Apple is, of course, fully within its rights to green- or red-light whatever it wants on its App Store. It built the thing, after all. It also built the iPhones and iPod touches that rely on it. Along with AT&T, Apple is rightly worried about the potential for VoIP-based traffic and services to erode long-term demand for conventional voice, SMS and related messaging services. It's Apple's business to lose. The company owns the playground, and it can takes its ball and go home if it wishes.

So the question for consumers isn't whether Apple should be punished for its actions. That's something for the FCC to decide. The regulatory body, concerned about possible anti-competitive behavior, has already waded into the waters by sending three letters to both Apple and AT&T asking them to explain their actions. The real question lies in whether consumers and jilted developers -- the poor folks left behind after Apple and its carrier-partner leave them in the dusty shadows in the corner where we used to play hopscotch -- should even bother going to that same playground any more.

We all know how it played out when we were kids, where we'd eventually stop trying to befriend the ball-hogging, loud-talking bullies who insisted on making the rules on everyone else's behalf. It was simple, really: At some point, everyone else just found another playground. We all got on with our young-ish lives, and to this day no one quite knows what happened to the brash-talking kids with the balls.

Real world. Real damage.

Chances are, we forgot them, because there really aren't any consequences beyond hurt feelings when kids get into playground disagreements. But in the real, adult world, the consequences can cause significant and lasting damage. For example, third-party developers, many of whom only found out about their products' removal from the App Store after the fact from potential buyers who could no longer purchase them, are being forced to provide refunds to customers who bought their now-orphaned (or is it marooned?) software. Apple's decision is hurting small business owners where it hurts most, in their cash flow, and the company doesn't even have the decency to let them know they're pulling their listings from the App Store. Nice.

Apple's inconsistency in approving some voice apps and rejecting others (Fring, iCall, Skype, and Textfree, for instance, are still available on the App Store), coupled with its refusal to make its selection process any less opaque than it already is, further stymies developers as they decide what markets and projects to pursue. If you like flying blind, I guess iPhone development is a lovely career choice for you.

Losing our mobile freedom

But as more of us adopt smartphones and we begin to lean more heavily on them to manage our day-to-day lives, we're going to expect the same kind of landscape that's governed the conventional PC market since we first began bringing them home en masse a generation ago. Namely, once the thing is set up, it's pretty much up to us to decide what to install and use, and how to use it. And for developers, they're completely free to sell their applications to anyone, using whatever distribution method makes sense to them.

Imagine if Microsoft had to approve every Windows app? Or the antitrust fits the FCC and the EU might have had back in the day if Bill Gates and Co. outright banned competing word processors and e-mail software from running on Windows-based machines? With that in mind, I'm somewhat surprised the outcry against Apple's and AT&T's combined actions here hasn't been more vocal, as the outcome of this case could very well dictate how freely we'll be able to use mobile devices in future and how much we'll pay for the privilege.

I recognize that the App Store is Apple's answer to the traditional obstacles facing developers and consumers alike. Traditionally, if you wanted to download a Windows app from the Web, you were stuck with having to pay for it in whatever form the developer dictated. Developers were similarly challenged to set up and maintain their own online storefront, fulfillment and payment infrastructure. The App Store adds huge value to the process, streamlining the marketing and acquisition process, while allowing smaller developers to compete alongside larger ones.

But only if Apple decides you're worthy. And that's the killer fly in this mobile ointment, and it's why the bloom on the iPhone rose may not last forever.

I'm certain one of Google's alternative strategies is to market the daylights out of Google Voice for Android, and any other platform whose architects are smart enough to learn from Apple's closed-garden mistakes. Because as wonderful as the iPhone platform is, Apple's insistence on sticking to antediluvian business practices and a Draconian app selection methodology threatens to make it easier over time for consumers and developers alike to look elsewhere for solutions that don't block them at every turn from doing the things they want and need to do...and that don't rip them off in the process. Not even the Cult of Apple is immune to this kind of erosion.

Carmi Levy is a Canadian-based independent technology analyst and journalist still trying to live down his past life leading help desks and managing projects for large financial services organizations. He comments extensively in a wide range of media, and works closely with clients to help them leverage technology and social media tools and processes to drive their business.