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."
Doesn't Anyone Remember? (Score:4, Interesting)
Re:It's Not Your Prerogative (Score:4, Interesting)
In response, Roth argued that exclusive deals enable innovation because the operator and manufacturer share the risk. He suggested that operators will ask manufacturers for certain features on phones but manufacturers will often only do so if the operator agrees to buy a certain number of phones, he said.
Corporate trusts are not supposed to decide what features go into products. That is one of the reasons that anti-trust regulation exists. Picking features and rewarding risk takers is the exclusive domain of the silent hand of the market. If you want to share the risk and get some exposure, then buy corporate bonds or non-voting shares from the handset manufacturer that pleases you. It is not a cartel or lateral monopoly's prerogative to manipulate decisions about product features.
The reason it is not the prerogative of trusts, cartels, or monopolies is because they are worse at it than the free market. Demonstrably so:
Did you notice, for example, that it took a computer company -- that had never had anything to do with cellular -- entering the market to finally get a smartphone that didn't suck into the US market?
Did you notice that the second acceptable smartphone came from a search engine company that had also never done cellular before?
Did you notice that that second smartphone got relegated to a third tier provider because the big boys were too busy sucking each others dicks to be bothered with an innovative product?
Did you notice that prior to the iPhone, America had just about the crappiest phones in the entire first world? Tiny little Taiwan was about a decade ahead of where we would be today were it not for Apple -- a complete outsider to your supposedly "innovative" little idiocracy.
You guys have been using your cartel to sit on your lazy, incompetent asses. Just like the auto manufacturers, except that Southeast Asian companies have a much harder time getting variances for cell towers than you, you fat, lazy fucks, so they haven't managed to kick your ass all up and down like they did to the auto makers.
I understand that you want to dictate features and restrain trade, but as it turns out, the free market(*) is a more efficient solution. So shove your transparent cartel rationalization up your ass and get out of my face.
Well, that's what the Senators should have said, anyway.
* Not laissez-faire, not anarchy: Adam Smith's free market, including regulation of anti-competitive behavior. Go re-read The Wealth of Nations if you doubt me.
+1 awesome.
The US cellular market still blows. It was terrible years ago and it will be forever unless something changes! I switched away from verizon because their selection was shit, and instead now I have AT&T, whose network blows compared to verizon. But I still don't have 3G on my damn phone because I want android and AT&T is too into the iPhone love to agree to do anything with android. I could switch to t-mobile but now my work is paying for AT&T, so I'm stuck with EDGE only on my unlocked G1 even though my *FLIP PHONE* 4 years ago had 3G! I used to stream the daily show!
If the manufacturers weren't so damn entangled with the carriers, they wouldn't be able to keep selling the complete shit they call most phones and there might be some real innovation to get consumer interest! I mean really, look at any cheap phone today and tell me what, if any, features it has over a cheap phone from 4 years ago!? They have pretty much stopped developing things on that end.
As far as smartphones go, i hear rumors that AT&T is finally coming out with an android phone this summer, and it has a *QVGA* screen!? WTF? That is horrible. the iphone and g1 have TWICE as many pixels! Why go backwards!?
That may not be true but either way, the US cellular market is just shit and I would LOVE for something to change!
-Taylor
Re:It's Not Your Prerogative (Score:5, Interesting)
* Not laissez-faire, not anarchy: Adam Smith's free market, including regulation of anti-competitive behavior. Go re-read The Wealth of Nations if you doubt me
Thanks for pointing this out, I get so annoyed by people who assume that trying to apply free market solutions means endorsing complete anarchy. And then there are others who don't see how regulation can sometimes help make a market more free and increase competition.
Re:It's Not Your Prerogative (Score:4, Interesting)
Except for the nasty gay reference (why...?) that was well-written.
Wow - very sorry to put it in a way that could be so easily misunderstood. I am totally in favor of whatever sexual and emotional bonds make a person happy. I meant it in the sense of pleasuring one another to the exclusion of outsiders, not about gender preference. I totally see, though, that my choice of turn of phrase could be easily misinterpreted and so I should avoid it.
Seriously, I'm sorry - I think anything that can give two people a little happiness is a beautiful thing.
Re:This should've happened years ago (Score:4, Interesting)
as an iPhone owner i'd like to pose a thought specifically re: iPhone and AT&T service. I live in the NY,NJ,PA tri-state area where AT&T has less than reputable service. (in much of the US AT&T has fairly good coverage) i've been with AT&T for over 10 years (from Cingular) in multiple locations in the US. i've never had any issues whatsoever with my phone service until i got my iPhone. now i will be the first to admit i _really_ like my iPhone, i like it enough to spell it with a capital "P" and lowercase "i". i dont even capitalize myself when i say 'i'. that being said, the iPhone has dropped calls more times than i possibly can fathom! i'm sure i've dropped over 250 calls minimum in the past 8 months or so that i've had the device. prior to this, i've only ever dropped 1 call in 10 _years_ with AT&T. i am dissatisfied with AT&T service plans but i have to recognize there is a possiblity that the iPhone itself has some real issues, it may be just the way it works with AT&T service (if anyone has any experince with other carriers, O2, the canadian one or whatever please ceel free to add your experience.) it may be the device, either way i wont know for sure till i can take my iPhone to another carrier.
Agreed (Score:5, Interesting)
They don't pay for insurance coverage... it's just free medical care with highly prioritized and preferential treatment. That's one of the big problems with healthcare -- legislators never see the problem because they never experience it and those who have quickly forget it once they enter that arena
Which is why we if we want the health care problem solved, one essential step will probably be insisting legislators and their staff have no access to any kind of group health care policy.
Mind you some of them are probably well off enough this wouldn't be a particular inconvenience, but the staff thing ought to do it.
Re:This should've happened years ago (Score:1, Interesting)
My AT&T iPhone experience was the opposite. It didn't drop calls in spots where my previous phone consistently dropped them. That said, in the past few months, I've been having more and more problems with dropped calls during tower handoffs (transitioning from one tower to another). This is on a first-generation iPhone, so there haven't been any firmware changes to the phone that could explain these problems. (The first-gen iPhone hasn't had new baseband firmware since roughly when the 3G came out.) It is entirely a problem of AT&T's towers just plain botching up the handoff.
I'm hopeful that AT&T will fix these problems at some point, but right now, my first-gen iPhone seems to fail almost every single tower handoff in the south SF Bay area even at low speeds on city streets. Something is clearly wrong with their tower firmware and this is a *recent* problem. It worked flawlessly in these same spots until just a few months ago, and it does reestablish access to the tower with full bars after a few seconds if you sit at one of these "dead spots". For these reasons, I'm fairly certain that this is not an iPhone problem, but rather a case of AT&T being utterly the most incompetent telco on the planet.
The only other possibility would be a baseband crash, but that seems unlikely to occur so consistently during tower handoffs. Also, I often have full bars within a fraction of a second after the call dropping, which couldn't possibly occur if it were caused by a baseband crash. Thus, it seems pretty likely that AT&T is simply way, way over their network capacity and are not giving high enough priority to tower handoff traffic.
all plans are too pricey, $20 max should be it. (Score:2, Interesting)
If $10 data plan gives you 1gig, that is equal to more than 8hrs of voice talk per day for 1 month. Which is pretty much to unlimited voice (not including connection costs to LL).
So having that as a fact, no voice plan should ever charge more than $20 per month for unlimited voice, anything higher is pure ripoffs.
Can I get a $10 data plan for a mobile with VOIP?
And surely having one plan for everyone would save marketing and confusing options, no more crap, just one plan, $20 = infinite voice, 1c text, 1gig data on top. Who wouldnt be happy with that besides a cheapass wanting $5 plans.
Re:Doesn't Anyone Remember? (Score:4, Interesting)
Oh? So if AT&T said no Apple was just going to build their own cell phone network? I don't think so. Apple's terms were they didn't want to be restricted in what they can do with their phone. That scared the hell out of everyone. But AT&T took a chance and it paid off big time. Every other carrier turned Apple down cold. There is nothing "fanboy" about this.
2 cents? you owe me change (Score:4, Interesting)
The deal with old phones is that there was a FCC mandated sunset of non-e911 capable phones.
You could maintain already activated phones, but couldn't activate - or reactivate those phones after that date.
You're dredging up old news - there are very few people with 6 year old non-e911 phones.
And yes - there are still valid technical reason for not being able to transfer hardware.
You can't use an ATT or T-mobile gsm phone on a Verizon cdma network.
Or an ATT tdma phone on an ATT gsm network.
Cellular carriers are less monopolistic than ever before.
There are fewer players now, but with their expanded networks, they are now most all in direct competition with each other, rather than the almost feudal state that existed in the days of patchwork coverage areas.
Another possibility is capacity. (Score:5, Interesting)
[iPhone drops on tower handoffs in SF south bay area.]
Something is clearly wrong with their tower firmware and this is a *recent* problem. It worked flawlessly in these same spots until just a few months ago, and it does reestablish access to the tower with full bars after a few seconds if you sit at one of these "dead spots". ...
The only other possibility would be a baseband crash, but that seems unlikely to occur so consistently during tower handoffs. Also, I often have full bars within a fraction of a second after the call dropping, ...
IMHO another possibility is network saturation. If you have to switch to a new tower or pie-slice because you're losing the old one, and all the slots in the new one are in use, you're hosed until a slot frees up. Park in the "dead zone" and eventually somebody will hang up or move on and the tower will give you a slot. Meanwhile the phone can hear the tower (and its control channel) just fine, so you get bars but no audio. (You'll also be able to send and receive text messages, which are on the control channel. But try to make a new call and you'll get all-trunks-busy.)
This doesn't require a firmware change or anything else other than not having enough cells for the traffic in the area. The "correct" solution is to split the cells up more finely - by installing a bunch of new short range cells to replace a few long-range ones or possibly to split the pie-slices more finely or do steerable antennas.
But both approaches require capital investment in a "lending freeze" economy - where cellphone upgrades are the first thing the consumers cut. The first one also requires regulatory approval for more antenna sites in eco-wacko land where "no nasty carcinogenic electromagnetic fields in MY back yard" is the paradigm of people who don't get the inverse-square law and are perfectly willing to put the antenna of the portable end of the system right up against their skulls.
Precedent (Score:2, Interesting)
If two cells can hear your phone... (Score:3, Interesting)
all newer phones have to be trackable by the police incase you call 911 and don't know where you are.
If three cells can hear your phone (and they have the necessary equipment to agree on timing and cooperatively measure it) they can locate you within feet. Better than remotely-interrogatable GPS in the phone.
If two cells can hear your phone (and ditto) and understand the delay of the phone model's response to a ping, they can do the same but put you in one of two spots - where you are and the mirror-image point with the line between the cells as a mirror. (Actually on a vertical circle which intersects the ground at those two points - so you could look a tad farther away than you are if you are hang-gliding or on a skyscraper roof.) If they don't have a good measure of ping time they can still spot you on a hyperbola.
Mods on crack, as usual (Score:1, Interesting)
Parent is not a troll; what he says is exactly what happened. No other carrier was willing to work with Apple on features like visual voicemail, unlimited data transfer, or end user activation, and no other carrier would have agreed to give up any say in what applications would be allowed to run.
People forget just how crippled cell phones were before the iPhone. Carriers insisted on turning off GPS, Bluetooth, and other features that were already supported in hardware on the phones they sold in their own stores.
At the time, AT&T's service was dead last in consumer satisfaction surveys. My understanding is that they were literally Apple's last resort; all of the other carriers had told them to get lost. AT&T wisely saw the iPhone as a way to get their act together and regain lost prestige in the marketplace.
I'm not exactly an AT&T fanboy, but that's the way it went down.