FCC To Probe Exclusive Mobile Deals 159
On Tuesday, we discussed news that four US Senators would be looking into the exclusivity deals between carriers and cell phone makers. Apparently, they didn't like what they heard. Reader Ian Lamont writes with an update:
"The Federal Communications Commission is planning on launching an investigation into exclusive handset deals between mobile carriers and handset makers. In a speech on Thursday, acting FCC Chairman Michael Copps said the agency 'should determine whether some of these arrangements adversely restrict consumer choice or harm the development of innovative devices, and it should take appropriate action if it finds harm.' It's not hard to imagine who might be targeted — at a separate Senate Committee on Commerce hearing on Thursday, much of the discussion centered on AT&T's exclusive deal to carry the iPhone. AT&T claimed 'consumers benefit from exclusive deals in three ways: innovation, lower cost and more choice,' but carriers and senators from states with large rural populations disagreed, saying that their customers had no choice when it came to the iPhone — it's not available because AT&Ts network doesn't reach these areas. One panelist also brought up the Carterfone precedent (PDF), which concerned an 'electrical acoustic coupling device' that a man named Tom Carter developed in the 1950s to let field workers make phone calls using a radio transceiver connected to AT&T's phone network. AT&T, which was then a monopoly, claimed no foreign devices could be connected to its network, but lost when it challenged the Carterfone in court. The result spurred innovation such as the fax machine."
beyond the rural issue (Score:5, Informative)
There's AT&Ts recent withdrawal of the iPhone from Pay As You Go availability.
Basically, if you want an iPhone on an affordable plan, you can't get it, because AT&T doesn't offer PAYG and because affordable operators like MetroPCS can't offer one either (yes, I realize MetroPCS isn't GSM, it's just an example).
This should've happened years ago (Score:1, Informative)
I've never understood why you could only use certain phones with certain carriers. I've never used an iphone before until yesterday and I really liked it, but was extremely dismayed by being stuck with AT&T.
I've talked with coworkers and friends in the area who use AT&T and most of their responses are about how crappy it is.
Therefore no iphone for me until I can choose another carrier.
only 1/2 the story (Score:1, Informative)
Innovation is only 1/2 the rule "tho shalt not adversely restrict consumer choice" is the other 1/2. The carterphone decision can illustrate both.
Re:This should've happened years ago (Score:3, Informative)
Every carrier is a crappy carrier.
Re:enforcement of antitrust laws (Score:2, Informative)
I have not come across any "body" that attempts to lobby, write to local congressman/senators or follow legal channels to help enforce consumer antitrust.
Read: http://www.usdoj.gov/atr/public/div_stats/211491.htm
Quoted:
"There are three main ways in which the federal antitrust laws are enforced: criminal and civil enforcement actions brought by the Antitrust Division of the Department of Justice, civil enforcement actions brought by the Federal Trade Commission and lawsuits brought by private parties asserting damage claims."
Re:This is what I'd like to see (Score:5, Informative)
But, you see, this doesn't preclude subsidized phones.
Look, I have no problem with AT&T saying, "Hey, join our network for two years and we'll give you an iPhone for $199!" That's a fine way to get business and I have no problem with it. I don't even have a problem with Apple making this deal exclusive with AT&T.
Where I have the problem is when that's the only way. If I want to spent $700 on an iPhone and use it on T-Mobile, Commnet, Indigo Wireless, Smartcall, or Union Wireless, that's fine, too. If any of the above companies want to support Visual Voicemail, they should be able to get the specs from Apple and implement it as well.
This way, I can sit down and determine what kind of plan I want. Do I want a contract where I'm locked in for x years, but I have less immediate out-of-pocket expenses, a subsidized phone, and more predictable bills? Do I want a pay-as-I-go plan which may mean some really heavy months but some really light months, too? Must I have an iPhone? Is it better to spend $700 for the iPhone and $50/month for my plan, or spend $200 for iPhone and $70/month for my plan. Have I gotta have the latest/greatest phone and I'll want to switch every year? Am I the kind of person who keeps a cellphone for three or four years?
Re:Well, my 2 cents (Score:1, Informative)
If you want an iPhone on Verizon, that's certainly within your legal rights. All you have to do is solder CDMA baseband hardware in place of the current baseband hardware, jailbreak the phone, binary patch the low-level code that interacts with the baseband hardware to work correctly with the CDMA baseband hardware, then convince Verizon to allow the device on their network. Surprisingly, that last part is not the most difficult part.... :-D
If you want an iPhone on a more realistic network like T-Mobile, that's also within your legal rights. Purchase a phone from a country where they are sold unlocked, e.g. much of Europe. Of course, if you want to get 3G on T-Mobile USA, you'll have to solder new baseband hardware in place of the current baseband hardware, jailbreak....
You get the idea. Okay, so the iPhone 3G chipset is, AFAICT, technically capable of the bands T-Mobile USA uses, but it's unclear whether the OS will allow you to enable the 1700 MHz band. If so, then you might just need to create a custom carrier settings file. Either way, nobody has gotten both bands to work so far.
Re:Well, my 2 cents (Score:3, Informative)
Since when can't you take your phone with you? I took a phone from T-Mobile to AT&T, then took my AT&T phone several years down the line and gave it to a friend for use on T-Mobile.
All you have to do is call your carrier after your contract is up and ask for the subsidy unlock code, or get it unlocked by someone who's figured out how to do it.
Re:This is what I'd like to see (Score:3, Informative)
Show me one phone that lasts 2 years also.
Kyocera QCP-3035
LG VX4400
LG VX7000
Samsung SCH-u740 (Alias)
Surely I'm not the only person who uses a phone for two years or more before replacing it.
Carterphone led to purchased phones and ... (Score:5, Informative)
The carterfone and that whole line of reasoning has nothing to do with the iphone on competitor networks.
Carterphone is directly applicable.
The carterphone decision is specifically about letting people buy phone equipment of their own choice and requiring the phone companies to let them attach it to the network, rather than renting the limited choice of company-provided equipment.
It led to the "foreign attachments tariffs" and in two steps to the type-approval process, where any equipment that would meet the standards for interoperability could be certified by a lab hired by the manufacturer, then bought and connected by a customer.
(It also led to long-distance service competition, antitrust litigation, and the breakup of the AT&T monopoly: MCI was formed, strung microwave links between cities, hooked 'em up to local phone lines, and let people bypass the AT&T long-distance service by dialing a local number then a customer ID and a long-distance number. AT&T sued, MCI counter-sued on antitrust and won, Southern Pacific Railroad strung fiber beside the tracks for their train signals and formed Sprint to sell the extra bandwidth on their network, ...)
Carterphone was about breaking an anticompetitive tie-in between a network provider and its captive equipment supplier - with wireline rather than wireless equipment. Yes, in this case the bite is on the other carriers more than on the customers of the offending carrier (though the tiny General Telephone company, with its smal islands of local-phone customers, couldn't get Western Electric phones back then - a similar situation). So though the precedent won't transfer directly, IMHO the comparison is still apt.
Re:What could possibly go wrong? (Score:2, Informative)
I assume that this is what you're referring to, so this is for those that don't get the joke.
Ted Kennedy is on the TSA no fly list is consequentially hassled at airports. This was covered on Slashdot a few years back.
A little Telco history here. (Score:3, Informative)
It wasn't that non-AT&T phones wouldn't work, there -were- no phones except AT&T phones manufactured by Western Electric, an AT&T subsidiary. Not only that, AT&T owned 100% of phones. You could only rent them. If you were in possession of a Western Electric phone not rented from AT&T, it was stolen. No non-AT&T devices could legally be connected to the PSTN, because this (AT&T FUD) would damage the network. There were no RJ-11 modular phone jacks, phones were connected to terminal blocks, and it was illegal for anybody but an AT&T technician to screw or unscrew the two little red and green wires. If you wanted more than one phone in your home or apartment, you had to rent another one from AT&T for the then-high price of maybe $3/month, and AT&T would come and install it for the then-high price of maybe $20. In the seventies, four things happened. First, phone phreaks like your Dad started collecting phones that had fallen from trucks and installing them for friends and neighbors (and Ma Bell would monitor how many amperes were drawn by telephone bells to catch people with illegal phones). Second, AT&T was broken up by the courts for antitrust violations (it has now mostly reconstituted itself). Third, companies like MCI began competing with AT&T for long distance connections, driving the cost of phone calls down, way down. Fourth, the FCC opened up the network, the RJ-11 modular phone was introduced, and people were allowed for the first time to connect non-AT&T phones and other devices. AT&T still bitched and moaned about the possibility of current overload, and for a while competing phone manufacturers had to label their devices with a Ringer Equivalnce Number, but this went away with the introduction of electronic ringers.
The introduction of modular phones didn't lower local phone bills any, no advance in technology ever has (except for VOIP). Call waiting, call forwarding, and caller ID were invented circa 1980, and to this day have not been significantly improved.