Google Voice by blocking customers' access to numbers hosted by carriers that charge higher interconnect fees -- something that's specifically forbidden for traditional telephone carriers under so-called common carrier laws. The argument essentially revolves around the fact that Google's move helps it compete unfairly against AT&T and others by arbitrarily blocking calls to numbers that'd cost it too much to connect, which AT&T says puts Google in an "intellectual contradiction" given its "noisome trumpeting" (ouch!) of support for net neutrality.
It is pretty interesting that Google wants a free, open internet with the left hand while it's blocking certain telephone calls with the other, but Mountain View wasted no time in responding to the communication, posting an quick blog piece where it says there are "many significant differences" that should exempt it from common carrier legislation (some sound reasonable, though the argument that "Google Voice is currently invitation-only, serving a limited number of users" makes us think they're digging pretty deep to come up with reasons they shouldn't have to pony up the cash to get these calls connected).
If there's a bright side to the bickering, it's that both AT&T and Google can agree on one thing: rural carriers' continued ability to charge high connection fees hurts everyone -- it's a "badly flawed" system, in Google's words, and it'd be great if the FCC would do something about it. Whether this whole spat ultimately influenced the outcome of the Google Voice iPhone app debacle is unclear, but it's obvious that AT&T's been stewing about this for a while -- so let it all out, guys, mommy FCC's here for you, and one way or another we suspect GV's going to have to end up going legit if it wants to grow its user base by any significant measure. Check out the gallery for AT&T's letter and follow the read link for Google's shorter, slightly less aggressive response.