Senators To Examine Exclusive Handset Deals

narramissic writes "Based on a request that a group of rural operators sent asking the FCC to examine the practice of handset exclusivity, four members of the Commerce Subcommittee on Communications, Technology and the Internet sent a letter to the FCC expressing their concern. Small operators, like U.S. Cellular argue (PDF) that 'exclusive handset contracts divide wireless customers into haves and have nots.' But nationwide operators, including Verizon, maintain (PDF) that 'in the absence of exclusivity agreements, wireless carriers would have less incentive to develop and promote innovative handsets.' The Commerce Committee expects to hold a hearing on the issue tomorrow."

Comments

Binding Contracts.

[Anonymous Coward]

" Small operators, like U.S. Cellular argue (PDF) that 'exclusive handset contracts divide wireless customers into haves and have nots.' But nationwide operators, including Verizon, maintain (PDF) that 'in the absence of exclusivity agreements, wireless carriers would have less incentive to develop and promote innovative handsets.'"

So I can use a U.S. Cellular phone under contract in any other compatiable network?

Re:Binding Contracts.

[hedwards]

That's not at all what they're complaining about. They're complaining about the fact that they couldn't make iPhones and other sought after phones available to their customers. Basically they're stepping in for the consumer in this instance, which is common for smaller competitors to do, to try and get a piece of the action. Which is necessary for a competitive market. Not that an individual phone which is paid for largely or entirely by subsidy be allowed to break the contract with no consequence. Just allow for any company that wishes to offer the subsidy the opportunity to do so.

Re:Binding Contracts.

[dougsyo]

US Cellular appears to be a CDMA network from my spot-checks, so they couldn't use a stock IPhone on their network if they wanted.

That's part of the battle right now - even US GSM phones from T-Mobile vs ATT aren't 3G-compatible, nor compatible with CDMA networks (Verizon, Sprint, US Cellular).

Doug

Re:Binding Contracts.

[Qzukk]

wireless carriers would have less incentive to develop and promote innovative handsets

I'll buy "promote" but when was the last time a wireless carrier ever "developed" a handset? And no, I don't count taking a good handset someone else made and crippling all of its features with a shitty firmware overwrite that turns the phone to crap.

Re:Binding Contracts.

[Brickwall]

I used to work for a cellular carrier in Canada. When wireless data was introduced, there were quite significant technical differences between the devices. Trying to adapt our network to support all the devices was quite impossible - it would have cost way too much, sucked up engineering resources we needed elsewhere, and because of the testing needed to ensure there were no incompatibilities, delayed product introduction, giving our competitors an advantage.

It made a great deal of sense to select one or two devices, get them to agree to an exclusive contract, which would include us paying to promote their devices, and get the product to market. I don't see this situation being any different. It helped both us as a network provider, and them as a device provider. I don't see this as a conspiracy to restrict trade, just common business sense.

And, on an unrelated note, could anyone tell me why the HTML "li" code now works erratically? Is there another code that just gives me a simple new paragraph?

Re:Binding Contracts.

[Shadow of Eternity]

You can set your formatting style to plain text and just hit enter.

Re:Binding Contracts.

[sabernet]

"I used to work for a cellular carrier in Canada."
.
.
Congratulations on escaping from your evil overlords. If it wasn't for the "used to" part, I'd have suggested you'd be better typing that as Anonymous Coward ;)

Re:Binding Contracts.

[FeriteCore]

I'd suggest trying

if you aren't creating a list.

Re:Binding Contracts.

[yamfry]

Maybe the cellular carrier in Canada could have used some of its profits from charging some of the highest prices in the western world [article is a bit dated, but still accurate] for wireless services to hire adequate engineering resources to help their networks function with new technology and allow interoperability. Instead of investing in resources to improve network speed and capacity, they abuse monopoly power to amass profits and engage in rent-seeking behaviour. I'm not blaming you personally, of course. But saying that a wireless company with significant government-granted monopoly power, grants, and tax cuts is locking in devices because making things work is too hard is a little disingenuous.

Re:Binding Contracts.

[Anonymous Coward]

You are correct, USCC is running on CDMA rather than GSM. It doesn't mean that a version of the iPhone with a different radio couldn't be developed.

I happen to live in an area serviced by the big 4 carriers as well as USCC and thought long and hard about choosing a smart phone from USCC or an iPhone from AT&T. I ended up with an HTC Touch Pro simply because I was unwilling to suffer with AT&T's poor coverage in NE Wisconsin. AT&T has no reason to deliver 3G due to fact that it isn't cost effective to deploy it in the area I live in, simply due to lack of population. To be fair, USCC still only supports CDMA 1x in my part of Wisconsin, but they at least have some plan to deploy EVDO, which is significantly faster than CDMA 1x.

I have to agree with the RCA for the most part. I think that carriers should not have exclusivity with regard to mobile devices; at least not of multi-year proportions. Carriers should not differentiate themselves by what handsets they offer, but rather the quality and performance of the service they provide. If we were to rate carriers by the this standard, perhaps they would improve coverage areas as well as customer service related issues. I'm certain that a fair amount of readers would have some good stories to tell about poor coverage and poor customer service from their wireless carriers.

Re:Binding Contracts.

[Anonymous Coward]

And, on an unrelated note, could anyone tell me why the HTML "li" code now works erratically? Is there another code that just gives me a simple new paragraph?

How about the "p" tag?

Re:Binding Contracts.

[socsoc]

And, on an unrelated note, could anyone tell me why the HTML "li" code now works erratically? Is there another code that just gives me a simple new paragraph?

On a similarly unrelated note, can anyone tell me why throwing candles lit by matches at my Stouffer's frozen meal isn't warming it up? Is there a proper industry standard for doing something simple that I have completely missed out on?

Re:Binding Contracts.

[Brickwall]

I don't disagree about the high prices; I remember the VP Marketing tell me, in no uncertain terms, "Our basic policy is we never discount minutes".

But you underestimate the challenges we faced after introduction (this was about 20 years ago). The collective genius of marketing predicted the number of subscribers as "X"; when it turned out to be "3X", every other division of the company was scrambling. There weren't enough people in customer service to handle all the complaints, so we got a reputation for lousy service. There weren't enough cell sites so the engineers were working 60 hours to provision and tune them. The billing system was from Cincinnati Bell, and they didn't give us source code. I was the technical liason from Marketing to these other departments. When the upper crust of Marketing decided we needed to add a new billing plan, they would send me down with the admonition "They'll try to give you some excuse about not having source code; it's just their way of stalling". So even though we were getting lots of customers, our costs with all the overtime, rush fees, etc., were very high. We had to rebate a lot of calls because they dropped part way through. And the sales people were allowed to give out "non revenue" lines to clients (read "friends"); when they finally audited that, they were astonished to find that we had given out over 20,000 non-rev lines in Ontario alone - that was about 1 in 8, IIRC. In that environment, trying to adapt to new equipment was, shall we say, problematic. I recall one occasion when I was trying to find the status of the integration of voice mail/paging system, the engineer in charge saw me in the switch room and literally ran away.

Still, it was a tremendous education in how not to run a business. I left after 18 months much wiser.

Re:Binding Contracts.

[Brickwall]

Very droll. The issue is I used to use "li" all the time, and it worked perfectly fine. Now, sometimes it gives you one line, sometimes none, and sometimes two. See my sig for my reaction.

Re:Binding Contracts.

[FictionPimp]

So Apple can't choose which market to develop for? For example if they decided not to make a CDMA phone, would you rather the government force them to?

I think locking a phone out of contract should be illegal. But locking a phone to a carrier while in contract is fine with me. They are subsidizing my phone, so they should have rights to keep me using it on their service only until I "pay it off".

Don't get me wrong, I'd love to have an G1 with AT&T. But I think it's the phone manufactures right to make exclusive agreements with carriers as long as I can take the phone to any network compatible provider after my contract has been for-filled.

I do think the line "wireless carriers would have less incentive to develop and promote innovative handsets" is a bunch of bullshit though. I can't see AT&T putting a huge budget into developing phones. I would suspect LG, apple, etc are using their own R&D money then recouping it with exclusive contracts.

There are other ways to compete besides phones. You could stop charing for text messaging, stop the per minute billing, start providing features that all US carriers are currently hating on (tethering?). Hell you could of jumped on the open source bandwagon and backed something like open moko.

It seems to me they don't want to compete, they want to bitch and make the competition less competitive.

Re:Binding Contracts.

[Fallen Kell]

And, on an unrelated note, could anyone tell me why the HTML "li" code now works erratically? Is there another code that just gives me a simple new paragraph?

"BR""BR" (replace "'s with angle brackets)

As for your statement about when data was added to the wireless networks. I can understand that happening in the beginning. In the beginning there were no data standards. There were just a bunch of different companies with different handsets which sent data all in different ways. But, now there are these things called standards. Like GSM, GPRS, HSDPA, CDMA, 2G, 3G, EDGE, 3.5G, 1xRTT, and EV-DO. And many phones support multiple standards or can be configured to support a specific standard. All that should matter now is what standard your cellular network supports and that is it. ANY phone that happens to support that standard should be allowed to be used. It doesn't matter if you are AT&T, Verizon, or Joe's Fancy Wireless... If they all happen to use 3G, then any phone that supports 3G should be allowed to be purchased and used on that carrier, because they are just that, a carrier. They are selling access to a network service. They are not and should not be the gatekeepers of what device is allowed on that network as long as it follows the communications standard (just like the internet providers, and cable TV networks, they can not say that only Comcast Cable users can purchase the 70" Sony XRB8 OLED LCD TV, and if you want to use that TV to watch DirectTV satellite, well FU).

The cellular companies are a carrier and service provider who provides a wireless access for phone and data. They should be held to the same requirements as other providers of services in which the hardware that connects to the service is freely usable by anyone on any provider that has a network which supports the same standards that the hardware supports.

Re:Binding Contracts.

[ksheff]

I wouldn't think it would be the carrier's responsibility to try to support all types of phones. They could just implement a particular version of a standard, let their customers know what phones support that version, and then work toward adopting the next version of that standard depending on customer feedback and what they're competitors are doing.

If it weren't for the exclusive agreement, the iPhone could work on any GSM network in the US and the carriers would compete based on what network related features. So AT&T could tout visual voicemail as a competitive edge and T-mobile could use some other feature (tethering?, cheaper plans, video on demand to subscribers, whatever). When T-Mobile added visual voicemail, they could include it as yet another feature offered. Let the carriers focus on network related stuff, the phone manufactures worry about their hardware, and the various standards committees work out common details.

BTW, what's wrong with the regular old paragraph tag?

Re:Binding Contracts.

[arminw]

...Trying to adapt our network to support all the devices was quite impossible...

It is rather late in the game, but I think government should have done for the cell phone industry what they did for me broadcast industry and that is simply a standardized the technology for a single compatible system. The government should simply say to the wireless telephone industry that they must have a compatible system that all handsets and networks can use. After all, I do not have to have a special television receiver for the different stations do I? If people cannot agree upon standards, they must be imposed on them. In the long run everybody is better off that way. Also, why do phones have to be subsidized while radio and television never worked that way?

Re:Binding Contracts.

[arminw]

... It doesn't mean that a version of the iPhone with a different radio couldn't be developed....

Why should handset manufacturers be required to develop different handsets for different networks? Radio and television manufacturers were never required to do this. Government simply picked a standard and imposed it on everybody. It is a bit late to do that now but maybe it should be done anyway.

Re:Binding Contracts.

[jonwil]

I did work a few years ago for an unnamed handset maker and I can tell you that standards aren't always followed to the letter.
There was at least one incident where we had to fix something in our bit of the handset software because it wouldnt work correctly with the in-car cellphone connect of a certain model of luxury car. So just because its supposedly a "standard" doesn't mean there wont be incompatibilities in some places or certain edge cases.

Re:Binding Contracts.

[Miseph]

"It seems to me they don't want to compete, they want to bitch and make the competition less competitive."

Thank you for reminding me of the single biggest flaw in capitalistic competition theory... given the choice, no capitalist would ever compete, and given actual circumstances that happens more often than we might like to think.

Re:Binding Contracts.

[jonwil]

Knowing the government, they would either pick a crap standard (or one with a crap implementation) *cough*CDMA*cough* or they would try to invent something new and get it wrong. Even if they did the right thing and picked GSM and UMTS as the standards, what frequencies should they pick? 1900? 1700? 850? 700? (all 4 are currently in use for UMTS in the USA or will be in the future). Or would they just mandate multi-band UMTS phones (which makes the phones a lot bigger and more expensive)

Re:Binding Contracts.

[shutdown -p now]

I used to work for a cellular carrier in Canada. When wireless data was introduced, there were quite significant technical differences between the devices. Trying to adapt our network to support all the devices was quite impossible - it would have cost way too much, sucked up engineering resources we needed elsewhere, and because of the testing needed to ensure there were no incompatibilities, delayed product introduction, giving our competitors an advantage.

It made a great deal of sense to select one or two devices, get them to agree to an exclusive contract, which would include us paying to promote their devices, and get the product to market. I don't see this situation being any different. It helped both us as a network provider, and them as a device provider. I don't see this as a conspiracy to restrict trade, just common business sense.

I have no idea how long ago you've worked there, but I haven't seen people having hardware compatibility problems with, say, GPRS, in the last several years. So, no, it's not a good excuse these days. Especially when very few devices are actually carrier-exclusive - all the rest somehow manage to work just fine on all networks...

Re:Binding Contracts.

[jonwil]

They shouldn't be locking your phone whilst on contract. Since you are on contract, you are still paying them back through your monthly fees regardless of which carrier you are using your phone on.

Only time they need to lock a phone is when its subsidized but not on a contract (e.g. discounted prepaid phones).

Re:Binding Contracts.

[profplump]

I love it when people trot out the "break the phone subsidy contract" bit, to try an look smart, and then apply it incorrectly.

First, so long as I don't cancel my contract, I don't see why my original provider has any interest in whether or not I can also use that phone on a second carrier, or sell it to a third party, which is all locking prevents. Even if at some point in the future I decided to drop the original carrier, I'd still have to pay a cancelation fee, so they'd be out none of their precious subsidy no matter what I did with the phone in the mean time.

Second, no one lets you start service without a 12-24 month contract that includes a cancelation fee EVEN IF YOU BRING YOUR OWN EQUIPMENT. There's no phone subsidy involved when I bring my own phone, but I've yet to find post-paid voice + data service from a national provider who did not require a year+ contract with a cancelation penalty. What exactly is the purpose of the cancelation fee in those circumstances -- am I supposed to believe they suffer hundreds of dollars in administrative costs just to activate a single line of service?

Re:Binding Contracts.

[profplump]

T-mobile could just send your voicemail as a frigging email attachment or multi-media text message -- those work just like "visual voicemail", and on a whole slew of phones to boot. Heck, they could probably even ding you for the text message deliveru and make an extra $0.10/message in the process.

Re:Binding Contracts.

[JakartaDean]

Trying to adapt our network to support all the devices was quite impossible - it would have cost way too much, sucked up engineering resources we needed elsewhere, and because of the testing needed to ensure there were no incompatibilities, delayed product introduction, giving our competitors an advantage.

I wonder if the problem wasn't in your network? Here in Indonesia I use a Nokia on one network, I have friends with other makes and models of phones (but all GSM) on other networks, plus 3G dongles, and they all just work for data. Fine. Out of the box -- the SIM even configures all the data parameters. The problem isn't in the network -- it was in your network.

Re:Binding Contracts.

[wgoodman]

last i checked, it wasn't the wireless carriers that "develop and promote" said handsets.. it's the same handset vendors that do quite well in other markets where they're not contractually obligated to only sell to company X.

Re:Binding Contracts.

[Anonymous Coward]

It made a great deal of sense to select one or two devices, get them to agree to an exclusive contract, which would include us paying to promote their devices, and get the product to market.

Leave out the 'exclusive contract' bit, and it makes even more sense. For the market and the consumer, anyway.

Re:Binding Contracts.

[X0563511]

I'm not sure what the problem was. Cell networks are built on standards. If you obey the standard, there should be no reason any other standards-respecting equipment won't talk.

Maybe your company just tried to cut corners/costs and built the network half-assed?

Re:Binding Contracts.

[X0563511]

If you were designing a communications device... wouldn't you make the part that actually talks physically modular?

I don't see why they can't just detach the radio component and put a different one on to support a different physical layer.

If you don't build it like a retard, the upper layers shouldn't care what the hell runs underneath them.

Re:Binding Contracts.

[X0563511]

http://news.slashdot.org/comments.pl?sid=1271263&cid=28359029

If your hardware doesn't make it easy, you're doing it wrong.

Re:Binding Contracts.

[ILongForDarkness]

I get a similar problem with the "br" code, some times I get a space between the new paragraph and sometimes I don't. It's not a big deal except for the 20% or so of the time that the last sentence is close to the end of the line and it is really hard to tell it is a new paragraph or just word wrap. Damn you formatting gods. I vote for WYSIWYG on /. its about freaking time we leave the 90's.

Re:Binding Contracts.

[Anonymous Coward]

How is this different to any other devices though? If a customer buys a phone which doesn't properly support the standard then why is it your fault?

Re:Binding Contracts.

[jonwil]

If a customer buys a new phone and finds it doesn't work with his expensive car, he is going to take the phone back and get a new phone (from another manufacturer) that does work with his car.

Re:Binding Contracts.

[Lachlan Hunt]

So I can use a U.S. Cellular phone under contract in any other compatiable network?

In an ideal world, yes, and in other countries it's possible to get handsets independently of any contract, (or by getting one on a pre-paid plan and then paying a relatively small unlocking fee when the credit runs out). You're then free to get a contract with any carrier and use any SIM card. This is how it works in Australia, and is why, if and when I do a new iPhone 3G S, I will be buying it there, instead of going through AT&T when I move to the US later this year.

Re:Binding Contracts.

[Quothz]

I did work a few years ago for an unnamed handset maker

That must've saved a lot on letterhead and business cards.

Re:Binding Contracts.

[weszz]

I would say yes. if it's a CDMA phone, call up their call center and give them the code under the battery and they can add it.

I worked for the Cell back when they made the move from TDMA to CDMA, and that's how it worked then, back then the Cell also didn't lock their phones and were pretty open, no idea how they are now, but their phones still are lagging WAY behind the bigger names...

As the Touch Pro 2 comes out, they come out with the Touch Pro 1. and that's how they work... best coverage in northern illinois/south wisconsin, but their phones are just bad...

it was a good company to work for until they bought PrimeCo though...

Re:Binding Contracts.

[parlancex]

When was this? In the pre-TDMA analog only cell phone the size of bricks days? Wireless communications between cellphones / handsets and wireless communications infrastructure have been standardized for a long time. If the carrier you were working for was standards compliant they would have nothing to worry about, and even then, is maintaining a device compatibility list so hard?

Re:Binding Contracts.

[david_thornley]

Which is why all cars should come with a clutch pedal - after all, the driver controls shouldn't care what the hell runs underneath them, including whether the transmission is manual or automatic.

Re:Binding Contracts.

[twidarkling]

See, you started off so well, and then your argument went to crap.

Yes, they should be able to decide what standard to make their handset for (CDMA, GMS, whatever), but why should that prevent me from using the phone with any carrier who supports it? It's not the handset makers that make the deals, it's the carriers. They know people want certain phones, and those people are willing to change carriers to get them.

It's like ISPs selling cheap computers on signing a contract, and instead of competing on how fast/stable their connections are, they're competing based on one sells computers with Intel chips, and the other AMD. Either one, theoretically, should be able to work on the network, and if you wanted to, you could go get one for more from somewhere else, and it would work on either one. But they're still competing based purely on how you're accessing their network, not on why you should choose them.

Re:Binding Contracts.

[Anonymous Coward]

So your complaint that you misused something and now are angry that your misuse isn't breaking in the same manner as before?

Re:Binding Contracts.

[Anonymous Coward]

I wasn't aware li was supposed to do anything outside a ol or ul tag. Why don't you just learn to use the tags intended for the purpose? (p or br)

Re:Binding Contracts.

[arminw]

...they would either pick a crap standard (or one with a crap implementation)...

I think that any standard is better than no standard. It worked out reasonably okay for broadcasting, maybe not ideal, but can you imagine having a different receiver for different stations? There should be one national telephone network that would allow any and all receivers or handsets to work properly. After all, the Internet and its standards are worldwide. Why cannot we have a worldwide wireless telephone standard as well?

Re:Binding Contracts.

[supernova_hq]

Exactly. Cell phones and Cellular connectivity should be handled the same way as computers and the internet. You should be able to buy ANY phone without talking to a telco, then take that phone and use it on ANY compatible network. In fact, the carrier shouldn't even need to know what type of phone it is, just the serial number for identification and the protocol (3g, gsm, etc) for connectivity. It's time to rip the telcos and the phone manufacturers apart and force them to supply their products separately.

Re:Binding Contracts.

[Vastad]

It's when I hear fascinating inside stories like this regarding the gigantic telecoms industry, that I really wish somebody would do a Fast Food Nation style expose of all the ugly guts of the industry. If only Joseph Heller were still around to write it.

Re:Binding Contracts.

[badkarmadayaccount]

Ain't that what got us x86?

Re:Binding Contracts.

[X0563511]

Except that is a completely invalid comparison, and you know it.

For that matter, if you take a real close look, I'm sure you can see where a clutch pedal could be mounted, should your vehicle have a manual version. Mine has a big plastic footrest in that spot, but if I rip that off, I can CLEARLY see where a clutch pedal would be mounted.

Carriers != Manufacturers

[Anonymous Coward]

'in the absence of exclusivity agreements, wireless carriers would have less incentive to develop and promote innovative handsets.'

I wasn't aware that the carriers were in the business of manufacturing...

Re:Carriers != Manufacturers

[toppavak]

Maybe not directly, but carriers do dictate and direct a lot of handset development. Really its the "promote" part of that statement that matters- Verizon puts a lot of money into marketing the BBerry Storm, AT&T helps market the iPhone etc. The argument is that without exclusive handsets there's less motivation to do this. There is some truth to that argument, but a more open ecosystem when it comes to mobile phones in the United States can only be a good thing for consumers.

Re:Carriers != Manufacturers

[Octorian]

They sure seem to want to make all the customers think that they are. Heck, all their marketing seems to be about the "phones they offer" almost more so than the "service they provide".

People need to wake up and realize that their beloved phones come from Apple, RIM, HTC, Palm, Nokia, etc, and *not* from AT&T, T-Mobile, Verizon, or Sprint.

Of course in the US its a little more complicated in that every carrier seems to use a different radio technology, sometimes with overlap and sometimes without. (i.e. AT&T and T-Mobile are both GSM, but diverge for 3G) And of all the hot smartphones, it seems like only RIM actually cares about supporting all carriers and radio technologies (for the most part, as the Storm is an exception, sorta).

Re:Carriers != Manufacturers

[Anonymous Coward]

The inequality still holds. Manufactures should be doing the promoting. Notice how Apple promotes the iPhone. RIM should start promoting its own products. Same for Nokia, SE, etc. etc.

Re:Carriers != Manufacturers

[shawn(at)fsu]

If the carrier doesn't market the phone then the manufacture will. These manufactures do just well in non US markets, in fact I doubt it would hurt the manufacture at all.

Re:Carriers != Manufacturers

[davester666]

Well, if they couldn't strike these handset deals, the carriers might have to...focus on their damn networks...

Because right now the carriers seem to just be playing lip service to their networks.

Oh, you want an iPhone, but AT&T has a crappy network in your area. Right now, AT&T has a negligible incentive to upgrade their network in your area, but you have to take their network in your area to get the iPhone. If it weren't exclusive, AT&T might actually improve their network if they see a large group of people remaining on T-Mobile and using the iPhone instead of having a small group switch to AT&T anyways.

And just maybe MMS and Tethering might have been possible for the past year if AT&T wasn't able to dictate to Apple that they couldn't be used.

Re:Carriers != Manufacturers

[Anonymous Coward]

AT&T helps market the iPhone

Yeah! Where would Apple be without the PR geniuses at AT&T helping them to market their latest toys?

Re:Carriers != Manufacturers

[afidel]

Uh, AT&T's network is substantially better than T-Mobiles in all but the most crowded of markets (AT&T is too successful for the amount of bandwidth they have in a few markets). They also use GSM which makes them better for international travelers than Verizon (though Verizon now offers Blackberry's with a GSM radio). I've found everyone elses network to be crap unless you are in a very rare circumstance (I have a friend that lives on the edge of AT&T and Verizon coverage zones but has good coverage through Alltel). Also you can buy unbundled iPhones from Apple, they are simply expensive ($499 for the 8GB 3G - $699 for the 32GB 3Gs.) but I'm not sure about the ability to unlock it as it says it's designed only for AT&T's network (untrue since it's a GSM device that's sold internationally on all sorts of networks).

Re:Carriers != Manufacturers

[Anonymous Coward]

Only in the USA. Here, in New Zealand, the inovative handsets are pushed by people like "Nokia", "Sony Ericisson" and suchlike - by the manufacturers, NOT by the network providers.

Down the road from where I work, for example, is Nokia Care. Nokia themselves have a presence here in NZ.

Samsung advertise on TV, as do Sony. The networks hardly push the phones, selling more the contracts and connections and what phones they do sell. The iPhone is marketed - as much as it needs to - by Apple New Zealand, not by Vodafone.

Re:Carriers != Manufacturers

[Jane Q. Public]

There would be less motivation for the carriers to develop or promote innovative handsets, but a lot more motivation for others to do so, who won't in an atmosphere of exclusivity agreements.

It might not be as big a deal as certain other market forces, but exclusivity does tend to stifle innovation.

Re:Carriers != Manufacturers

[tsm_sf]

Maybe not directly, but carriers do dictate and direct a lot of handset development.

"You know those phones they have in Japan? Make me a shitty version."

Re:Carriers != Manufacturers

[digitalunity]

Not sure if you caught my comments on a previously posted related topic, but handset manufacturers currently serve the interests of the carriers, NOT the end users.

This practice is merely exemplified by exclusivity contracts such as the iPhone or Palm Pre. The real issue here is that handset success is based largely on the whims of the carriers, not on functionality or usability. Exclusivity is a byproduct of the common subsidized handset for reduced contract rates system we have in the US. If this practice were ended, so too would be exclusivity deals.

If you'll notice, there are now just a few "classes" of handsets, all with very similar functionality based on the desires of the largest carriers. Tying handset purchases to carrier contracts needs to end!

Re:Carriers != Manufacturers

[Sparr0]

AT&T has no cells in the MARTA train tunnels in Atlanta. Every other carrier does. That alone is enough that I am switching services next time I want a new phone.

Re:Carriers != Manufacturers

[Anonymous Coward]

Oh, yes... but wait... who cares?

Re:Carriers != Manufacturers

[Brickwall]

Sorry, this again misses the point. You clearly don't understand that network modifications might need to be made, changes to billing systems, etc., all of which cost money. A CDMA network is as different from a TDSM one as a highway is from a railroad. So Union Pacific should demand that GM - well, maybe Toyota - build cars that can on railways as well? Or, since that example is backward from this case, let's turn it around - GM should demand that UP change their signals, sidings, billing, etc., so their "dual" cars could run on UP's tracks? Yeah, that makes a lot of sense.

Re:Carriers != Manufacturers

[ckaminski]

WTF, we have an internet standard, a DSL standard, a DOCSIS standard. It's about time this nation decides on one network technology for Cellphones. since the rest of the world chose GSM and is loving it, I think we should heed their leadship, for once.

Re:Carriers != Manufacturers

[humphrm]

Translation: They pay the companies that actually develop and promote innovative handsets a ton of money for exclusivity, and that money goes into further R&D.

Re:Carriers != Manufacturers

[socsoc]

Trains and cars? Minimal changes need to be made to the cellular systems to support new models (that are similar to existing models) and monitor usage. This isn't 1993.

You are talking more about forcing a CDMA network into allowing my 802.11a adapter on, because hell, they both provide data. I get your analogy now. As soon as UP starts allowing GM cars on their tracks and not Toyota, then you would make sense.

It's less of a forcing GM onto UP, but if they'll allow GM on UP rails only if GM won't also sell to Southern Pacific, then that's why SP would call foul (any sort of rail spacing aside, I'm not a train enthusiast).

Re:Carriers != Manufacturers

[andymadigan]

Didn't you just break your own argument? I can't very well use my cable modem with my DSL connection, but they both get me on the internet. Likewise, my T-Mobile G1 won't work with Verizon any more than my CDMA Nokia would work with T-Mobile, but they both get me on the phone network.

That's how the cell phone companies see it. The only "features" on the phone for them are things that cost you money. E.g. $1/MB mobile web browsing, or text messaging.

This argument from U.S. Cellular is a non-starter, or at least I hope it is. What we really need is to unbundle the phone from the service entirely. Make the plans cheaper because the company isn't paying for the phone, and end these ridiculous contracts. Sure, you'll have to pay more up front, and the phone manufacturers will have to compete on price in a very large market.

Re:Carriers != Manufacturers

[erroneus]

Yeah, it's the promote part. Forget about the other words they said... you know, the ones that aren't true? As long as there is a bit of truth to cling to, let's focus on that.

The fact is, exclusive deals are very anti-competitive and is especially harmful to small carriers. Furthermore, the exclusivity of the iPhone to AT&T not only enables AT&T to gain an unfair advantage over the other carriers, more recently, it has been used to harm their existing customers. (These "start new plans with the new iPhone deal" is meant to bring in new customers, to hell with the loyal customers they already have -- they are on contract anyway.)

I don't have a prediction on how this may turn out, but I will say that if legislators or courts end up saying "no, you can't do that any more" then my guess is the next time this thing happens, the carrier will buy or accept a range of patents on the exclusive handset and then start suing other carriers who try to sell the same handset.

We have all been very annoyed at the way the carriers play games with handsets and have been doing so for decades. That behavior was halted when the POTS companies did it and I find it amazing that wireless carriers are permitted. It's time it all stops.

Re:Carriers != Manufacturers

[wonkavader]

"I wasn't aware that the carriers were in the business of manufacturing..."

Oh, yes they ARE. Or rather, they dictate what features will be available in the handsets they sell. in particular, they dictate what the handsets WON'T do. They keep their customers from having the ability to load ringtones, download information, upload music, etc. Anything the providers think they can charge for, they keep the handsets from being able to do via any connectivity outside of communication with the carrier.

Carriers routinely tell manufacturers to cripple their offerings. The manufacturers do it, because if they didn't they'd have to look elsewhere for distribution.

Re:Carriers != Manufacturers

[Anonymous Coward]

Really its the "promote" part of that statement that matters- Verizon puts a lot of money into marketing the BBerry Storm, AT&T helps market the iPhone etc.

The carriers do not pay a dime for "marketing" the handsets. It's all paid for by the vendors via MDF (marketing development funds).

The carriers are gate-keepers. Want your handset to be easily accessible to a captive market? Play ball with the carriers. Even Apple, with the brand behind them, has had to make concessions to AT&T. So has Palm with the Pre (no discussion of tethering on Sprint!!!)

Many consumers would choke on the retail price for a non-subsidized phone with even moderate capability. Just ask Nokia. If you can't get a carrier to position your phone with subsidies and the backing of customer support, you're going to face a very uphill battle for marketshare.

Yes, the carriers dicate and direct handset development, but unless the vendor has substantial momentum behind them to negotiate with, it will always be in the favor of the carrier. Not the consumer.

Re:Carriers != Manufacturers

[Anonymous Coward]

Exclusivity is a byproduct of the common subsidized handset for reduced contract rates system we have in the US.

reduced contract rates? WTF. The subsidized handsets increase the monthly contract rates and lower the upfront cost of the phone. That's why people were originally bitching about the 1st generation iPhones that cost $600. But do the carriers drop your rates after the initial contract is over and you're using a paid for cell phone? Hell no.

Re:Carriers != Manufacturers

[Brickwall]

I don't disagree with you in general, but when companies started offering a bonus to sales agents for each new customer signed up - a not uncommon sales incentive, some agents quickly found that offering some of that rebate to the customer increased their gross sales dramatically. I remember a sales guy I worked with at a telecom firm after I left the cellular company complaining "You guys raped and pillaged us on handset prices". I thought this was a bit rich coming from a guy who charged $70,000 for a 4-channel voice mail system (and no, that's not a typo!), but it was indicative of consumer attitudes. Once they found some people offering lower prices on handsets, they were convinced that we were overcharging, and a few cents extra a minute on their contract seemed to be inconsequential. Never underestimate the inability of the general public to perform basic arithmetic! If Total Cost of Ownership had been a common process, Apple should have owned the business market after it introduced the Mac (shorter training, fewer crashes, etc.). But people looked at Macs, saw a $3500 price, looked at a PC-AT, saw a $2500 price, and the rest, as Bill Gates might say, is history.

Re:Carriers != Manufacturers

[Anonymous Coward]

"Maybe not directly, but carriers do dictate and direct a lot of handset development."
Direct in the sense that they order handset manufacturers to remove legitimate and useful functionality so the carriers can push and promote their always-less-useful-and-more-expensive (read: bullshit) features.

Re:Carriers != Manufacturers

[jonwil]

The carriers exert a LOT of influence over the manufacturers. Carrier says "give us that phone but remove the WiFi chip and disable the GPS please". Manufacturer has to say "yes" else carrier says "OK, then, we wont sell your phones"

Only manufacturers at this point that MIGHT be able to say NO to carriers would be RIM (because the Blackberry is so important to business customers and unlike Windows Mobile there is no alternative supplier) and Apple (who has a phone so hot that AT&T cant afford not to keep carrying it)

Re:Carriers != Manufacturers

[digitalunity]

That's kind of my point. Contract rates are based on them subsidizing your purchase of the most expensive phone. People taking shitty "free" phones merely prop up profits.

Carriers do not tell you to upgrade or lower your rates when your contract expires-it's their customers responsibility apparently. Conversely, if you choose to obtain service but already have a phone, they do not offer you a reduced rate.

This in my mind is a strong case of product tying, essentially they offer nothing of value if you choose to not participate in their phone acquisition subsidization plan and is anti-free market. It reduces end user choice because the phone manufacturers hamstring their products to whatever the networks desire. Just look at the newest iPhone supporting tethering but AT&T won't let it be advertised in foreign countries because it will raise expectations for AT&T's domestic customers.

Re:Carriers != Manufacturers

[A]

You cannot purchase an unlocked iPhone in the USA. The expensive editions are just contract-free, they are still locked to AT&T.

Also, I see lots of opinion in your post without any citations to back it up. Lets see some consumer satisfaction surveys to back up your big claims.

Re:Carriers != Manufacturers

[digitalunity]

A forced unbundling of phone purchases from contracts would effectively end exclusivity agreements also. Competition among handset producers would be based on functionality, not how much the carrier wants to push it based on profitability.

I agree with US Cellular that exclusivity agreements are bad, but ending exclusivity doesn't go far enough to fix the domestic cellular market.

Re:Carriers != Manufacturers

[Zerth]

That's pretty much true. For awhile, Verizon could lock down BB GPS because they only used AGPS, so they needed Verizon's supplemental location servers. Now that most BBs have full GPS, I don't have to pay Verizon $5/month just to use somebody else's mapping software. And having full bluetooth is awesome.

Re:Carriers != Manufacturers

[Anonymous Coward]

Just like the banks developed "innovative financial products".
Hey that worked!

Re:Carriers != Manufacturers

[Anonymous Coward]

I'm pretty sure he was just using AT&T as an example. If you like, switch the companies, and his point still stands.

Re:Carriers != Manufacturers

[sumdumass]

I think the subtle point the Cell phone companies were attempting to make is that you can have a phone with all sorts of gadgets, but it the Cell company doesn't support the backed for it, then it's pretty much useless gadgets.

That's where their innovation supposedly comes from. They do request features and stuff like that so they aren't necessarily reacting to what is being produced, in some cases, they are driving it's production.

However, I still fail to see how charging an outrageous amount of money for the phones they initiate development on then discounting them heavily for subscribers or subscribers who renew their contracts wouldn't work as a substitute. It's more or less what they do now with replacement phones and upgrades that are locked into thier network. I recently attempted to purchase a new phone, it would have been roughly $100 if I signed the contract and $500 if I didn't. Instead, I purchased one from Ebay and bought a new SIMS card for a grand total of $106 altogether. I suspect I will need to replace the battery sometime soon, but I generally use base chargers and swap batteries out once a day anyways so buying another is a given.

Re:Carriers != Manufacturers

[pimpimpim]

Actually, it's going even better outside the US. The more fancy phones have been first available in Asia with full functionality for a long time now. And it also works the other way, I can buy for 40 euro or smth an unlocked phone with no fancy options, but that I can use to ... phone! Cool for the consumer, but I guess most US providers are not into the "make your customers happy"-business.

Re:Carriers != Manufacturers

[Jesus_666]

40? For a while you could get a new Nokia 1110i for ten bucks. Twenty to thirty is definitely a possible range for a low-end phone, even from reputable manufacturers.

Re:Carriers != Manufacturers

[Anonymous Coward]

There is no truth to that argument, that's how they pull the wool over your eyes. They say that they do this in the interests of innovation, but believe you me, the US handset market might just be the most fragmented in the world.

My org has been involved in discussions with all the major US carriers about carrying our mobile Java app, but each carrier has enforced their own idiosyncracies on the handsets in their network. It's been exasperating so far, we go & demonstrate the app on an Alltel (now VZW) phone, when T-Mobile or USCellular ask us to do the same on their own devices, it takes us weeks to figure out why it's not working. They say that their technicians will be available to us for support, but never have they given us more than 0.5 hrs at a time, that too while they're busy doing something else.

They were always very happy to point the finger on our app, while it has worked flawlessly (or with minor nits, at worst) all over EU, APAC & RoW. Only in US does it become a problem of such magnitude.

So what I'm trying to say is that this exclusivity is just a synonym for monopoly abuse...

Re:Carriers != Manufacturers

[Anonymous Coward]

They're not. They all use Asian contract manufacturers. Verizon is a fucking liar.

Re:Carriers != Manufacturers

[kextyn]

You're missing the point. Forget that he said AT&T or T-Mobile. Get rid of exclusive deals for phones and the carriers have to compete directly for your business.

Re:Carriers != Manufacturers

[weszz]

oh hell no...

GSM and CDMA both have their good sides, such as GSM cannot do analog, which would be very useful in country area that digital signals don't cover well. (CMDA can do digital and analog, and being code differentiated, i think can handle more traffic)

GMS is great for Europe, but if i'm not mistaken i think a large part of Africa and Asia use CDMA...

TDMA i think has gone the way of the dodo, since from my understanding it's much the same as CDMA, but less bandwidth since it's Time differentiated.

As far as saying one is antiquated and the other is still good, I don't think that holds any more water than saying that Mac or Unix is antiquated since MS is newer.

They both come out with new technology, but it's easy to say that Win 95 is outdated, but that's not the MS standard.

Personally I like CDMA more than GSM, which is part of the reason I have sprint service (imagine that, a consumer making a choice on personal preference and not government mandate...), US Cell has great coverage in southern WI and northern Illinois, but their phones just suck out loud.

Re:Carriers != Manufacturers

[Anonymous Coward]

I thought carriers only directed feature locking?

Re:Carriers != Manufacturers

[Anonymous Coward]

And therefore there it will not happen. Good for consumer is a ticket to no where in congress.

Re:Carriers != Manufacturers

[Nerdposeur]

Verizon puts a lot of money into marketing the BBerry Storm, AT&T helps market the iPhone etc. The argument is that without exclusive handsets there's less motivation to do this.

Yes, without exclusivity, the carriers wouldn't be motivated to market themselves based on their exclusive handsets. That's not really an argument, though, just an observation.

Instead, they'd have to compete based on the things THEY actually create - their network, their customer service, and their plans. Which would be great for everyone - except them.

Re:Carriers != Manufacturers

[Nerdposeur]

[Carriers] do request features and stuff like that so they aren't necessarily reacting to what is being produced, in some cases, they are driving it's production.

More often, I think, carriers block features that would otherwise be on phones. "No, you can't include a USB port; then they won't need our service for sending pictures," or "No, you can't build in VOIP; then we can't charge them the way we want."

I'd rather have a cellular ISP - I pay for my bandwidth, and I do what I want with it. Including anything a handset maker can come up with.

Re:Carriers != Manufacturers

[Brandee07]

If you go to the AT&T website, there's no mention of the iPhone on the front page. If you go to Customer Service and it asks for the model and make of your phone, Apple/iPhone isn't even listed. It's like AT&T is pretending the iPhone doesn't exist.

Add in the Tethering/MMS issues (my 4 year old, $25 flip phone that doesn't even have a camera can send and receive MMS messages, and not my iPhone?!) and as an iPhone user, I feel like I'm paying a premium price to be a second-class citizen at AT&T.

At least my contract expiration will roughly coincide with the expiration of the exclusivity agreement, and I will be able to take my iPhone and go play with someone who treats me better.

Re:Carriers != Manufacturers

[JoelisHere]

Hmmm, I went to http://www.att.com/ and saw the huge iPhone 3GS flash banner smack dab in the middle of the page. Not sure which AT&T website you went to. (or when)

Re:Carriers != Manufacturers

[kbrannen]

The carriers exert a LOT of influence over the manufacturers. Carrier says "give us that phone but remove the WiFi chip and disable the GPS please". Manufacturer has to say "yes" else carrier says "OK, then, we wont sell your phones"

As someone who works for a handset manufacturer, I can tell you that is far more true than most people thing. The "operators" tells us what to put in a phone. The general public is really losing out on innovation.

I don't know that it's government's job to step into this, but the only real solution is to split sales of handsets and service; or in reality, split the tying of handsets and service together. It's useful to consumers to get the service and handsets at the same time, but when they are tied together in a contract is when everyone loses.

Re:Carriers != Manufacturers

[sjames]

From what I've seen, carriers are mostly interested in making sure that innovative handset features can be disabled by the carrier, either permanently or until the customer coughs up extra cash.

What they REALLY don't want is innovative handsets that let the user make full use of the service they've contracted for in the way that they want to.

God forbid someone should load up a 3 note ringtone without paying for it! Worst of all, of course would be if they use WiFi and VoIP rather than their precious minutes when at home.

Re:Carriers != Manufacturers

[wireloose]

The most annoying part is that some of the carriers, such as US Cellular, disable some of the handset features so that you have to use their costly services to, for example, share a photo. US Cellular provides good service in their areas of coverage, but I had phones from them over a number of years that blocked USB syncing. So even though I paid for some good phones, I could not do something so simple as use the Motorola desktop software to sync contact information with my email addressbook. US Cellular worked with Motorola to completely disable the ability to write data to the phones. I only found this out, of course, after I purchased the d*****d software. They did the same thing with Nokia phones, as well. So, I laughed hard when I saw US Cellular whining about phone models. If they carried the iPhone, by the time they got done locking it down, it would be equivalent to a Motorola RAZR.

Re:Carriers != Manufacturers

[ibbey]

I think the subtle point the Cell phone companies were attempting to make is that you can have a phone with all sorts of gadgets, but it the Cell company doesn't support the backed for it, then it's pretty much useless gadgets.

Hmm... Think you're pretty much wrong about this. Assuming the base feature set for a carrier to remain competitive (reliable network, 3g, SMS, MMS, Maybe a few more network related things), all the othyer 'features' can just be supported by the phone. Worst case, for something like the iPhone's Visual Voicemail, the manufacturer could run a server to support those feature transparently to the carrier. Most of the "features" supported by the carriers (GPS or TV viewing for example) are just things that could just as easily be provided by third party providers, but the carrier forces a lockdown on the phone so they can charge $9.99 a month for the same feature that many other phones provide for free. Want proof? My T-Mobile G1 provides both those features for free. The TV viewing is limited to YouTube, but there's no technical reason at all that Hulu or another free TV service couldn't be supported-- except the fact that the carrier forbids it!

Re:Carriers != Manufacturers

[againjj]

Actually, it's that the highway toll operators should not be able to forbid Toyota from making a car that works on UP's tracks. Right now, the Bay Area Toll Authority says, "Toyota, you are not allowed to sell Corollas that can run on anything but our toll roads, not even ones that run on other people's toll roads, never mind railroad tracks." Notice how the RAZR had several versions, one that worked on each type of network, and can be used on any carrier? Right now, it is okay for carriers to forbid that, and the small carriers are objecting.

Re:Carriers != Manufacturers

[sumdumass]

Man, your taking could be's as if they are realities.1...

The manufacturers and third parties could do a lot of things, right now, they aren't. The cell phone companies seem to be. That's their argument, not mine. I didn't say I bought the argument nor did I say I agreed with it. The reality is that most of what Cell phone manufacturers do is implement basic concepts and the Cell phone provider customized it to thier network, labels it, and offers it as a feature.

Sure, third parties or the manufacturers could do things like that. They could be doing it right now with the minor Cellular telecoms who are complaining but they aren't. At least no on a large scale.

Re:Carriers != Manufacturers

[demachina]

"but carriers do dictate and direct a lot of handset development"

The only problem with your assertion is that, at least in the U.S. all of their dictates and direction tend to be bad and devoid of innovation.

I think all of the innovative handsets listed in one of the articles were developed by tech companies not carriers, Apple's iPhone was almost certainly developed with no input from ATT, I doubt Sprint had much input to the Palm Pre, maybe Verizon had a little input to Blackberry Storm, not sure.

Everyone who HAS a cell phone in the U.S. knows U.S. cell phone carriers are pretty much the worst carriers on the planet. EVERY other country in the world seems to have better handsets, lower rates, less lock in, better networks and better service plans.

U.S. cell phone companies remind me a lot of U.S. car companies. They seem have some kind of an under the table agreement to all suck equally bad and screw their customers to the same level. They can then all provide bad service, at high prices, with abusive contacts and get away with it because all a customer can do is switch from one bad carrier to another bad carrier. This strategy worked great for U.S. car companies until the Japanese, who had signed on to their collusion, ate their lunch building better products cheaper, now two out of three have ended in bankruptcy. The only problem with the same thing happening to phone companies is the U.S. is a big place and its expensive and hard for a new competitor to come in and build a network from scratch so its unlikely any foreign competitor will seriously compete with them, T-Mobile tries but...

It sure would be interesting if DoCoMo moved in to the U.S. and did to the phone companies what Japanese cars did to the car companies. There sure is a lot of room for improvement.

As much as the U.S. and U.S. companies spout off about free markets, the invisible hand, competition, etc. the U.S. has deteriorated in to having a disturbing lack of competition. Cell phone companies are pretty much down to ATT and Verizon with Sprint on life support. Microsoft's only serious competitor in PC's is Apple which came back from the dead or there would be no competition at all, Intel's only serious competitor is a very weak AMD, Boeing's only commercial competitor is in Europe, the number of defense contractors is a tiny fraction of what it once was. Walmart, given time, may destroy all competition in the retail sector. The number of major banks is half what it was a couple years ago. Oil companies have merged to the point we are almost back the Standard Oil monopoly. Cable companies there is usually only one option in an area, and only two satellite services, all grossly overpriced. When the banks nearly failed, the government had to step in to rescue them in contravention of all free market principles because they were "too big to fail", what did we do, merge them in to an even smaller number of even bigger banks that were too big to fail.

The U.S. is turning in to a poster child for Capitalism's end game where one giant company dominates each market segment, and all competition disappears while they yammer about the importance of free markets and competition.

"Innovative", as in having features disabled?

[Anonymous Coward]

Um... yeah.. carriers would never disable features on cellphones, now would they?

Re:"Innovative", as in having features disabled?

[Octorian]

Thank goodness I don't use Verizon, and will continue to avoid them like the plague.

I actually want my Wi-Fi and GPS (usable by 3rd party software), damnit!

Re:"Innovative", as in having features disabled?

[afidel]

Buy a Blackberry then, we see no hampering of functionality on the Verizon Blackberries we own for people with poor AT&T reception. They are subsidized just like other phones too, they just have a little higher starting price than some of the non-smartphones (though the 8830 world is $50 online with 2 year contract).

Re:"Innovative", as in having features disabled?

[PitaBred]

You may not now, but two years ago when I bought my 8800 Verizon had the GPS locked so you had to use their service, and their data plans prevented you from tethering, at least until you paid almost 50% more than competing carriers.

Re:"Innovative", as in having features disabled?

[d3ac0n]

we see no hampering of functionality on the Verizon Blackberries we own

Then you aren't looking very closely. Verizon cripples BOTH the wifi capabilities AND the GPS capabilities of the phone so that they ONLY work with Verizon apps.

Go ahead, try and use Google Maps with a Verizon blackberry. Oh, Google maps works, but the location info is gleaned from the closest cell tower. NOT the GPS. So it can be as much as a MILE off.

AT&T does not do this, and I don't think Sprint does either (although I'm not certain on that one)

Verizon cripples everything they touch.

Re:"Innovative", as in having features disabled?

[digitalunity]

My HUGE issue with both Verizon and AT&T is that if you purchase a PDA phone such as a Blackberry, they require you to also subscribe to a special data plan at $20-$30 per month. I don't disagree that data access should cost more than voice, but both carriers already offer a so-called "unlimited" data plan for non-PDA phones at a lower cost. However, they both feel you can charge more just because it's a PDA, despite the fact that a Blackberry is no more capable of utilizing bandwidth than any other network enabled phone.

They're not very honest about why either. I'm in the market to switch carriers and I contacted both companies about why the regular unlimited data plans don't cover PDA's and mums the word. They just spew bullshit form letters about how the Blackberry plans offer unlimited data, but neglect to give any reason why they're special.

Re:"Innovative", as in having features disabled?

[Zerth]

Most blackberries didn't have full GPS back then. Tethering is still $15/month in my region, so that's a bit of a bummer.

And of course, they still screw you on BES charges, just because they can.

Re:"Innovative", as in having features disabled?

[Anonymous Coward]

You haven't been keeping up, they stopped blocking GPS since November 08. I've got Google Latitude running right now on my Storm, as well as a free position/timecode program for my photographs. Gets within 3 meters once it has been running for a minute(lacking Verizon's ephemeris data).

Re:"Innovative", as in having features disabled?

[gaspar ilom]

Here is a something regulators should consider:

Do any service providers disable *bluetooth* on their handsets?

Why? Surely, bluetooth capabilities don't cause an extra burden of technology they need to support, since bluetooth doesn't impact the provider's wireless network, right? (like, say, transferring a photo from your phone to your laptop?)

Re:"Innovative", as in having features disabled?

[Moridin42]

Uh.. they probably figure (and probably correctly, too) that people who own Blackberries, iPhones, G1s, and such transfer more data than those on regular handsets. Hence, "unlimited" data service on a handset, where entering a url with a numeric pad is a pain, get cheaper prices than phones that are designed and marketed for data use.

Re:"Innovative", as in having features disabled?

[Bob of Dole]

Bluetooth impacts their network, because they can no longer sell you their 0.50$/ea photo transfer service, they can't sell you ringtones for 2.99$ each, and you could use headsets without their 20$ markup.

Re:"Innovative", as in having features disabled?

[T-Bone-T]

I agree with the poster above me. Before I had an iPhone I had a 5MB/month data plan. I occasionally went over 5MB but not by much. With the iPhone, I easily hit 5MB every day, 30X more than with my previous phone. Not only is it easier to access the web, I get more of it by not having to use a "mobile" browser.

Re:"Innovative", as in having features disabled?

[afidel]

Nope, Google maps and wifi work fine on our 8830's, perhaps business accounts are handled differently than consumer devices?

Re:"Innovative", as in having features disabled?

[afidel]

Considering I stream radio from my Blackberry and we push quite a bit of data to our devices on a daily basis (business intelligence reports) they probably have a point.

Backwards Argument?

[MidnightBrewer]

It seems to me that in the absence of exclusivity agreements the carriers would have greater incentive to introduce new features because they wouldn't be allowed to dictate terms to handset manufacturers in order to maintain their current level of mediocre offerings.

Re:Backwards Argument?

[sodul]

I used to work for a big name smart phone manufacturer. The versions for Sprint/Verizon were crippled at the carrier's request, i.e.: disabling internet sharing to your laptop. The unlocked (GSM) versions of the phones had all the features, not because they were more expensive, just because there was nobody requiring to remove the features.

One of the problems with Sprint and Verizon is that the radio has to be specifically designed for them which mean you can only use a phone that they sell directly. With GSM providers (AT&T, T-Mobile, and most of the world) you just need to put the SIM card in and it works (granted the local frequencies are supported by the phone).

Normally the manufacturer has no interest to cripple it's own product, but when the carrier control what devices will work on their network you don't have any choice but to comply. It is pretty much the same situation as when you had to use the land phone from the One phone company and were not allowed to plug you own.

Re:Backwards Argument?

[Hey_bob]

I know I'm a bit with the Naive and silly.. I'd like to see all the carriers eventually switch using a common wireless standard/freq/whatever. So that any phone could be used on any carrier. *however* I still say let AT&T have their iPhone "exclusive" deal.. whatever. If you want a cheaper iPhone.. go get an AT&T contract. If someone on Verizon wants an iPhone.. They'll need to pony up whatever zillions of dollars the retail version will then cost. Plus maybe *everyone* can have good coverage.. not just Verizon here, T-mobile there etc..

Then it's a matter of luring people in with the better plan, or discount on the shiny new toy. Still room for making the better product.

Or.. apparently I want to move to Europe or something?

Re:Backwards Argument?

[complete loony]

One of the problems with Sprint and Verizon is that the radio has to be specifically designed for them which mean you can only use a phone that they sell directly

And the manufacturers are enabling this behaviour. If Sprint and Verizon didn't have your help we wouldn't be in this mess. Sometimes you have to say "NO".

Re:Backwards Argument?

[sodul]

Sometimes you have to say "NO".

Oh sure, and it would work for a company in a strong position, like Apple. If the company is hurting like Motorola, or Palm then you really cannot afford to not be sold by them. There is much more manufacturer competition than carrier competition and the big 4 carriers use that. Apple has reversed the roles a bit by having a true *must have* device. Sprint and Verizon got bitten by their own strategy and see a mass exodus to AT&T (I think customer support is not neutral on this).

Look at the last Treo model that was sold without carrier support. Sure you can use it with AT&T and TMobile but you have to pay the full price for it. I'm not even sure they've recouped development cost on this one.

As a customer I would much rather get lower monthly bill and no 2 year lock-in than getting a subsidized phone. This is pretty much paying a high interest perpetual loan on a device that is not that expensive anyway.

Re:Backwards Argument?

[complete loony]

It is possible to add features to a product that everyone purchasing it gets. What I suppose I meant was that manufacturers could be selling fully capable phones to Sprint and Verizon that also have the changes they need to access their network. And they could be selling the exact same phones to everyone else at the same time.

In an imaginary world where all manufacturers respected the spirit of the standards this kind of chicanery wouldn't be happening.

Re:Backwards Argument?

[Anonymous Coward]

And the manufacturers are enabling this behaviour.

Bullshit. Nokia said "No", and look what happened to them! The carriers said, "Fine, no thanks, we'll get our phones from someone else." And now Nokia has just a fraction of the US market because of it. Nokia realized that it was a mistake, and now even it is playing by the carriers' rules.

Re:Backwards Argument?

[FunkyMarcus]

One of the problems with Sprint and Verizon is that the radio has to be specifically designed for them

What about the radio needs to be carrier-specific? An EV-DO radio is an EV-DO radio.

The big US carriers are guilty of crippling, but it's got nothing to do with the air interface or the hardware. In the CDMA world, the same exact hardware is, more often than not, sold outside the US without crippled software. In fact, sometimes they're even sold as such inside the US, by smaller carriers that can't afford to heavily customize (cripple) the software.

Re:Backwards Argument?

[Anonymous Coward]

Ignoring Chinese attempts at their own nationalist standard, there are really only two standards seeing any action. GSM / UMTS, and CDMA2000 and descenants.

The next generation after UMTS is LTE (Long Term Evolution.) The generation after CDMA2000 was to be UMB. Wikipedia says, 'development halted in favor of LTE'.

http://en.wikipedia.org/wiki/Ultra_Mobile_Broadband

So, yes, next generation, you will have standardised on the UMTS descendants (i.e., LTE). While I don't think frequencies will be standardised, multi-band phones will the norm.

Re:Backwards Argument?

[jonaskoelker]

in order to maintain their current level of mediocre offerings.

You give them too much credit.

Re:Backwards Argument?

[CompMD]

Within the last couple of years, Verizon has opened its network to any CDMA device. You are freely able to bring a Sprint handset onto Verizon, provided you have the technical ability to load a Verizon PRL or can set your handset to default to Verizon's towers.

Just a shakedown scheme....

[Anonymous Coward]

The Senators in question are probably trolling for campaign contributions.

Re:Just a shakedown scheme....

[Anonymous Coward]

Oh dear. The US is just a massive Mafia family.

Here's a game..

[synthesizerpatel]

Name one innovative handset developed by carriers such as Sprint, AT&T, et all.

Nokia, RIM, Apple and (previously) Motorola have developed all the 'innovative handsets'.

What'd sprint give us?

Rebranded, OEM, disposable turds

Re:Here's a game..

[drinkypoo]

Name one innovative handset developed by carriers such as Sprint, AT&T, et all.

And by "promote" they mean "force handset manufacturers to agree to our terms lest we go to extensive measures to prevent their hardware which is designed to the standard which our hardware supports from working correctly." (Except, oddly enough, AT&T.)

Re:Here's a game..

[b96miata]

Except AT&T? Right, that'd be why the slingplayer mobile for iPhone is the only one that can't utilize the cellular network.

Re:Here's a game..

[drinkypoo]

Slingplayer mobile is a piece of software, not a phone. You are attacking a straw man. I am not sure what your complaint is; perhaps you could explain?

Re:Here's a game..

[b96miata]

You implied all the carriers save AT&T force handset manufacturers to agree to their terms. AT&T has forced apple to remove/cripple a number of apps for the iPhone as part of their business relationship.

Apple is a handset manufacturer. AT&T's terms are the blocking of apps which could result in a certain level of data usage on their network. AT&T forced Apple to agree to their terms as a condition of launching Apple's handset on their network.

While all major carriers engage in some level of feature-blocking, AT&T has been one of the higher-profile offenders of late. I'm not sure where you got the idea they were special.

What a crock

[BadAnalogyGuy]

On a technical level American carriers care only that the phones pass GCF. If they want to bring innovation into this, they are going to have to argue that somehow the business model itself is innovative, but I don't think that is what they are saying.

What is important in exclusivity is that users don't have a choice of carriers if they want to buy a specific phone. If you want the iPhone, you're stuck with AT&T, for example. But that doesn't bring any innovation to the phones themselves.

Unlocking the phones isn't any better, though, technologically speaking. With a choice of carriers, you end up with a lot of choice, but the phones on the market are still the same old dreck. The reason for this is because the innovation must happen at the phone maker level. To support this, operating system vendors need to also be innovative. And to make sure that innovative operating systems can run, advanced chips are necessary.

But none of that involves the carriers. Carriers are merely the pipes: A necessary component, but a wholly replaceable part. From a technical innovation standpoint, these guys are the road system. Cars are what we consider innovative, roads are only considered when they suck. And frankly, American cellular carriers suck.

Re:What a crock

[R3d M3rcury]

[...] innovation must happen at the phone maker level. To support this, operating system vendors need to also be innovative. And to make sure that innovative operating systems can run, advanced chips are necessary.

But none of that involves the carriers. Carriers are merely the pipes: A necessary component, but a wholly replaceable part.

Not entirely true.

Consider the iPhone, as an example. What did AT&T bring to the table, besides their network? Visual Voicemail. My friend has an unlocked iPhone on T-Mobile and he's switching to AT&T and getting the iPhone 3G S (his employer will pay for it). And the the most exciting thing for him is that he finally has Visual Voicemail.

I'll agree that so far, I haven't seen anything really great. Sprint's turn-by-turn directions, maybe. Verizon's V CAST looks ridiculous. But to say that the carriers are "just pipes" isn't 100% true.

Re:What a crock

[hedwards]

Largely yes, they do suck, but a large part of that has to do with the difficulty of changing networks. Nearly all the people I call are with AT&T, were I to switch carriers, I'd suddenly have to care about how many minutes I'm getting. And as hard as it is for me to believe, the reception seems to be worse than when Cingular was holding my account.

Phones are similar, if you're locked into a portion of the market making a more specialized phone is much less likely to turn a profit. Whereas it might do fine in the market at large, you're artificially stuck making it available network by network.

Re:What a crock

[BadAnalogyGuy]

It's true that some carriers may offer advanced bearer services, and that some phones may have features that work better or only on certain networks. If the carriers want to argue that angle, they may get some traction on this innovation claim.

I can see it going something like this:
1) We want to offer subscribers advanced bearer services
2) This is a chicken/egg problem - we can't offer it unless UE manufacturers build it, and vice versa
3) The only way to break through this is to work together to deploy these phones/services simultaneously
4) Since we are sharing development costs, we want to guarantee to recoup those costs
5) The way to recoup costs is to have exclusivity agreements

This isn't a bad argument, except that it shows just how deep in bed UE manus are with the carriers. Subsidized development, subsidized phones, exclusivity agreements. If you look at it, the whole thing is a huge oligopoly designed to keep little guys out of the market.

Re:What a crock

[maglor_83]

And this is exactly what should be happening. The carrier can develop technologies such as these to differentiate themselves from their competition, instead of relying on phone manufacturers. There is no reason they couldn't have done this without the iPhone. Phone manufacturers would much rather add features such as these to their phones, instead of the current situation of having to remove features because the networks demand it.

Re:What a crock

[Anonymous Coward]

I'll agree that so far, I haven't seen anything really great. Sprint's turn-by-turn directions, maybe. Verizon's V CAST looks ridiculous. But to say that the carriers are "just pipes" isn't 100% true.

Think if your home internet was setup like the cell phone system in the US right now? You would have to buy a Verizon/Dell laptop and use Verizon/Rhapsody Music service and use Verizon/Mapquest for all of your directions.
Here is the difference of the models
Ideal. Hand held device --> Carrier of data --> your choice of services.
Right now we have... Hand held device that only works with $Carrier with features setup and determined by $Carrier --> $Carrier --> Services by $Carrier and some access to services other than $Carrier but restricted. There is NO WAY IN HELL the current method is more innovative than the first.

If I buy a phone with GPS capabilites, I should be able to buy/use software of my choice to interface with some third party application of my choice to display and track where I am at and where I am going. I should NOT have to use Sprints service

Re:What a crock

[Anonymous Coward]

Yeah, they suck. Pay phones were SO much better.

Well...

[Anonymous Coward]

If the nationwide operators like the idea of exclusivity agreements, then those agreements are probably a Bad Idea.

Carriers R not devolopers

[Anonymous Coward]

I thought only Apple and Palm developed innovative handsets?

Re:Carriers R not devolopers

[icebike]

Exactly.

The carriers are always caught flat footed and demanding handset manufacturers disable features in their phones because the carriers don't know how to follow the standards.

I'm not aware of a single carrier that EVER came up with a handset design, innovative, or otherwise, unless you consider demanding lobotomies before letting them on the network.

Yes, I'm talking about you Verizon, and you too ATT.

T-Mobile Sucks But I'm stuck on a contract

[bit trollent]

T-Mobile Sucks But I'm stuck on a contract. Investigate that.

They never mentioned that they would have dead zones all over the place. At work, at bars, friends houses - everywhere. T-Mobile has little dead zones all over the place.

If they aren't going to provide the service they promised i.e. a working cell phone, then I shouldn't be bound to their contract.

But here I am, stuck in 1985 on a cell phone contract that would penalize me $200 for leaving the worst cell phone service I've used in 10 years.

Re:T-Mobile Sucks But I'm stuck on a contract

[Achromatic1978]

You're not. If your home or work is in a listed low coverage area, they'll let you out of your contract with no ETF, no arguments - all I got was a "We hope you'll consider us again when we've got better coverage in your area" (and I happily would... the -only- problem I have ever had with Tmo was coverage.

Re:T-Mobile Sucks But I'm stuck on a contract

[kelnos]

IIRC they give you 30 days from your contract start date to change your mind.

Re:T-Mobile Sucks But I'm stuck on a contract

[edmudama]

Do you honestly feel ~2 years of grief and frustration is worth less than $200? Then by all means, don't cancel, stand up for your principles.

Re:T-Mobile Sucks But I'm stuck on a contract

[Archimonde]

I'm guessing that the GP is on a 2 year contract. A lot can happen in two years. What if you change your job, house, city or whatever? You can't know that in the first month. Not even 6 months. I'm not even certain what will happen in the next 7 days.

Re:T-Mobile Sucks But I'm stuck on a contract

[kelnos]

Well, sorry, but that's just how it works. If you can't sign the contract... don't. There are other options, more expensive, usually, but that's the tradeoff you have to make. The initial month is nice to figure out if your phone will work in the places you care *now*, and that'll have to be good enough. Again: if you don't like the terms, don't accept them.

Re:T-Mobile Sucks But I'm stuck on a contract

[Archimonde]

You are preaching to the choir here. I was just laughing at the fact that they even give you 30 days to reconsider.

Here in Croatia, if you want to cancel your plan you have to pay the full price for remaining months. For example you have 2 year plan for 70$/month and you want to cancel it after the first year. You would have to pay 12(remaining months)*$70 = $840 which is a downright robbery unfortunately.

"Would have incentive to..."

[laughingcoyote]

"Without longer than a century copyright, I would have no incentive to develop anything useful." "Without being able to patent walking using both feet, I wouldn't have incentive to make anything useful." "Without being able to grant myself a monopoly on something, I would have no incentive to create anything useful." "Without the Shoot Anyone Using Anything But My Stuff Act, I would have no incentive to develop anything useful."

I am getting quite tired of seeing that, and we should really quit listening. If you don't want to, then by all means, don't, and feel free to fade away. In the meantime, those who still have plenty of incentive to do so (by finding creative ways to make money off of it, out of simply enjoying it, out of their own need for a tool to do something or a wish to create something for their own enjoyment, what have you), will do so.

I'm getting less and less tolerant of this temper tantrum. And that's really all it is-"I don't WANNA share!!!!! I thought of it FIRST!!!!" If the dinosaurs mean it, then by all means, their time has come and we should let them go. Good riddance to them, something better suited to modern times will take their place. On the other hand, they do tend to like paying themselves those large bonuses, so I would wager they'll start getting really creative in the absence of these artificial restrictions enabling them to be lazy and rest on their laurels.

Re:"Would have incentive to..."

[ckaminski]

Obama needs to crank up the trust-busting engine and undo the damage the Bush administration has allowed to happen with the mega-mergers. It wasn't just Bush (some happened under Clinton) but the amnesty granted to Microsoft after the anti-trust debacle was the start (IMHO), the Verizon/BellAtlantic/BellSouth megamergers... they need to be undone.

And I've been a die-hard Verizon Wireless customer for 12 years (trialling the Sprint/Pre service, which sucks in my area).

Re:"Would have incentive to..."

[Anonymous Coward]

In my view, you are the childish idiot here.

I am getting rather tired of the repeated cries for "Sharing! LOVE! Freedom! SHARE! COPYLEFT! GREED!", which is a mixture of ignorance and RMS' pseudo-communist hatred against proprietary software. Maybe you would rather be the one to shut the hell up instead?

Face it - those who cry and stamp their feet like crybabies against copyright have NEVER been able to propose any alternative model for how to do things - at least, with any kind of modelling for how industry, the creative and the technological sector would pan out. Are we talking complete global IP-burning? Are we talking free sharing of all media? In that case any and all designers would be out of jobs - why would someone pay twice as much for a product funded experimentally at high cost and using a horde of designers, just to get the product THIS WEEK, rather than simply wait a month and get it from China? If there is no free IP, what would hinder simply the development of private security forces and an explosion in industrial espionage, as companies seek to replicate IP protection through secrecy routines? You would see the rapid death of 90% of companies relying on experimental development, and anything "new" would be produced by someone whose hardware lockdown routines makes the PS3 look like a glass jar.

The idiocy of YOUR crowd is evident from the fact that if things don't happen the way you propose, and creative industries all die because of browser plugins that allow the instant transparent peer-to-peer downloading of any media name clicked on, you would simply say, "Tough luck! Sorry about that! My bad!". There's no going back, so do you really want people to put their livelihoods at stake for YOUR rants and fantasies?

If you're able to ridicule others by paraphrasing them, and saying how tired you are - then you should really learn to hear STFU to your face as well. Good riddance to yourself, get lost, idiot.

Re:"Would have incentive to..."

[Iceykitsune]

Absolute 30 year limit on copyright, NO EXCEPTIONS! if one cannot recoup the cost of producing a product, then their business model is flawed.

Re:"Would have incentive to..."

[digitalunity]

Agreed. The FCC has been largely absent in meaningful ways in the cellular carrier market for some time. Sure, they managed to sell off some spectrum but that doesn't do anything to solve the current problems in the US cellular market.

Re:"Would have incentive to..."

[teg]

I am getting rather tired of the repeated cries for "Sharing! LOVE! Freedom! SHARE! COPYLEFT! GREED!", which is a mixture of ignorance and RMS' pseudo-communist hatred against proprietary software.

Copyright was a two way street - the copyright holder got rights he didn't have previously, and the work fell into the public domain after a specified period of time. These days, money have bought extensions - so nothing expires anymore. By strange coincidence, the dividing line seems to be things copyrighted by Disney... a company who have many wonderful works built on works by others.

I'm not opposed to copyright, but I am opposed to just stopping progress and not letting the creators holding up their side of the bargain. I'm also opposed to a lot of the measures taken to enforce it, as they go too far and turn society into an Orwellian vision of the future - especially when combined with the current "we must allow anything which someone says maybe could be used to stop terror".

And as for software: Proprietary software has a place. Much work wouldn't happen without it. Customers (including governments) just need to be aware of the price they are paying for it, and that this is much more than the sticker price. They lose freedoms (e.g. of suppliers, maintenance, future compatibility and more) as well.

Re:"Would have incentive to..."

[Anonymous Coward]

In my view, you are the childish idiot here.

Actually, by your childish language, black and white reasoning and attempts to smear you've just proven that you are.

Re:"Would have incentive to..."

[Anonymous Coward]

So why don't you reply to his points? Oh you can use "childish language" to make sure he gets it.

"Develop and promote"?

[jayhawk88]

Since when does Verizon or any other carrier have anything to do with the development of a phone? They just take whatever you can get from HTC/Motorola/Samsung, throw a logo on it, change the name to something stupid, and pick 5 random features to cripple for no apparent reason. As for promotion, while I guess that charging customers 200% more for the phone than it's actually worth unless they sign a 2 year contract (if you let them but it unlocked at all) is technically "promotion", I don't think that is really in the spirit of the true definition.

What a bunch of tools.

Re:"Develop and promote"?

[spire3661]

This is like saying Microsoft has no say in hardware development. Its simply not true. Netbook development is pretty severely curtailed by Microsoft's netbook licensing arrangement. You arent going to build a device that has features your biggest customer frowns upon/outright bans.

Re:"Develop and promote"?

[jayhawk88]

You arent going to build a device that has features your biggest customer frowns upon/outright bans.

Yet this is exactly what carriers do with phones, especially smartphones. Verizon, for example, disables built-in GPS on almost all the handsets they offer, to force you to pay for their custom GPS app. And plenty of carriers have/continue to disable stuff like Bluetooth tethering.

Re:"Develop and promote"?

[kelnos]

That's part of the problem. The carriers shouldn't be the phone manufacturers' customers. The people who end up using the phones should be.

Re:"Develop and promote"?

[Austerity Empowers]

If random people got the ability to use the phone of their choice, and treat their wireless company as a bandwidth provider, a lot of value would be destroyed.

Re:"Develop and promote"?

[spire3661]

We should be pushing for legislation in this direction. That value is completely artificial. You cant have a service that is almost on par with a utility and not expect people to pressure you with legislation when you are artificially inflating the market and creating artificial value through technology suppression.

Re:"Develop and promote"?

[Anonymous Coward]

True, look how well windows mobile has taken off.

Re:"Develop and promote"?

[Anonymous Coward]

Since when does Verizon or any other carrier have anything to do with the development of a phone?

Are you kidding? Have you not looked at a Verizon phone? Compared one manufacturer of a Verizon phone to another? Verizon specifies practically every goddamn thing, right down to the placement of pixels on the screen in "their" UI (although this doesn't generally include smartphone UI's). The sad thing is that the manufacturer has to try and innovate within this rigid hell-hole. Verizon is one of the worst offenders in the group of carriers when it comes to messing with the development of phones, as their long history indicates.

Re:"Develop and promote"?

[ksheff]

The prepaid vendors are even worse. Even the one that promises "No Evil". Evil must be being able to get your damn contacts off the friggin phone or IF the phone can take pictures, they can't be downloaded directly to a computer. The phone's manufacture offers software to do all of the above? That's evil too, so the phone is lobotomized so these evil tools won't work with the phone. Being able to move a SIM card from one phone to another that you bought from them is evil too.

Re:"Develop and promote"?

[sjames]

It's the same "value" as services like Vinney's I won't slash your tires for a small fee service.

Re:"Develop and promote"?

[kelnos]

Thing is, people already *do* have the ability to use the phone of their choice, for the most part. You can easily buy a phone off ebay, unbranded, unlocked, and, assuming your network is compatible (which usually leaves out the CDMA providers), you can just put your SIM card in the new phone and do whatever you want. That's what I did; I have an unbranded, unlocked Motorola U9 that I'm using on T-Mobile's network in the US.

Besides, I don't really care about the carriers. The customer is king. If customers demand a more robust infrastructure that can handle more bandwidth-intensive applications, the carriers had damn well better provide it. If not, I'm sure there'd be another carrier willing to provide it and take my money.

About feaking time...

[ickleberry]

.. someone stood up to this nonsensical practice. For nearly 20 years we've had GSM openness in Europe and this sort of exclusive nonsense is making its way across the water in the form of the iPhone. For a while I have been thinking this is an attempt by the mobile phone operators to usher in a new wave of proprietary phones.

Heavy integration with online services, firmware branding and exclusive deals are nothing but bad news for us. I havn't bought a SIM-locked phone since 2001 and I hope to never have to buy one again. The openness of GSM is a great thing but people take it for granted here.

A lot of people buy locked phones because they are cheaper, but they shouldn't be cheaper. This was acceptable 10 years ago when not everybody had a phone but now there are too many phones. Producing more phones only generates more e-waste. There should be more countries like Belgium around where this shit with subsidising phones doesn't fly. At least then my collection of unlocked Nokias will be worth more than 20 cents

Exclusive handset deals are nothing more than a way of making people put up with a more expensive / lower quality network they wouldn't normally put up with.

Re:About feaking time...

[ducomputergeek]

One of the major problems over is that fact that we're not all GSM on this side of the pond, and therefore are not all that open simply because the radio chips are different. AT&T and T-Mobile are GSM. Verizon, Alltel, and US Cellular are all CDMA (iirc), and Sprint had PCS and Nextel had something else before they merged. So it's not like I can take an unlocked GSM phone and switch to Verizon.

Now my understanding that 4G will all pretty much be the same technology. But we don't even have 3G here yet and doubt well see 4G here until late in the next decade.

Re:About feaking time...

[Anonymous Coward]

Fully agree.

Here in India, being a GSM country to a very large extent, the concept of locked phones simply doesn't exist!! Phone manufacturers have to compete on price & features. Carriers have to compete on price & features. It's all led to an extremely competitive market. All the big players (4 or 5 of em) make decent profits, the small ones vacillate between profit in 1 quarter to a loss in another. But the market as a whole seems quite healthy.

Even the iPhones (all 7 of them that got sold) are unlocked, you wont find locked iPhones here.

I agree that visual voicemail like features may not originate in such a market, but in this country no one uses std voicemail. Text and/or missed calls are all the indications that you'll need here.

& finally talking about price: I normally spend about 4 hrs talking, send around a 1000 texts, & use about 10 MB of data, every month & I pay between USD12 & USD13 for my postpaid. I can send MMSs if I want, I can tether my phone to my PC (lousy speed tho) if I want.

I came across all the restrictions that carriers put on subscribers in the US, while following the tales of the new iPhone launch on the AT&T network, & I literally fell off my chair in amazement. What you guys have to put up with!!

Re:About feaking time...

[drinkypoo]

.. someone stood up to this nonsensical practice. For nearly 20 years we've had GSM openness in Europe

We have GSM openness here, too. If you use AT&T or T-Mobile as your carrier, you can use any unlocked GSM phone.

We had more GSM carriers, but they were bought by AT&T (nee SBC)

"innovative handsets?"

[immel]

From TFA:

the introduction of the iPhone has spurred many iPhone substitutes such as the HTC Touch, Blackberry Storm, Google G1, and several Samsung and LG models.
-AT&T

In other words, exclusivity deals breed ripoffs. Yeah, that's one form of competition, but it doesn't really seem like "innovation" to me when the release of one product that everyone wants causes every manufacturer to try to make an exact copy with a different exclusivity deal. If everyone carried the iPhone, these companies would be trying to differentiate themselves by coming up with the next big thing, not making copies of the last big thing.

wireless carriers would have less incentive to develop and promote innovative handsets.

I'm not from this industry, but I don't believe wireless providers develop handsets. Handset manufacturers (e.g. LG, Samsung, Motorola, etc.) do.

Re:"innovative handsets?"

[jonaskoelker]

I'm not from this industry [telecommunication]

Your signature, (

10 Bits= $.25
100 Bits= $.50
110 Bits= $.75
1000 Bits= 1 byte

) seems to suggest you know very well how it operates.

(Incidentally, if I paid for internet per byte similar to how I pay for text messages, I'd be paying ONE MEEELION DOLLARS per month. What the fuck is going on?)

Shouldnt be just exclusive handset deals

[jonwil]

It should be deals (including the way spectrum auctions are carried out and regulated) that result in carriers *cough*Verizon*cough* getting a monopoly (or near monopoly) in certain areas just because they are the only carrier with coverage. (like the deals various carriers have made to get exclusives in subway systems, high-rises and other places where extra equipment is needed to give sufficient coverage)

AT&T Does the same thing

[langelgjm]

Yeah, AT&T has done the same thing. I got an SE Z750 from AT not only did the AT&T branded OS look like shit for the 5 minutes I used it (some crappy orange AT&T color scheme), but AT&T's firmware disables the included GPS. In this case I think it's because they want to sell higher-end phones to people who want GPS (I payed $10 for this phone after a $60 rebate). Anyway, a quit trip to DaVinci team and less than $15, and I had restored an unbranded firmware that enabled GPS functionality.

It's really sad that not only do carriers take decent phones and make them worse, but then you end up having to pay to get back features that the phone originally had. Kind of like when you could pay Dell not to install all their crapware on new computers (is that still around?).

Re:AT&T Does the same thing

[dbcad7]

It's especially bad when you consider that the GPS signal is not even provided by the carrier.. It's not like your costing them money by using it. They want you to think that by using their custom GPS software with a monthly fee you are using GPS signals sent by them.. (although AGPS is a signal from them I suppose) .. In reality their navigation services should only be a one time charge for the software.. Worse ripoff than text message charges !

Get ready for Jitterbug handsets

[rwwyatt]

There is competition amongst the operators to develop the best handsets.. Without the iphone, would we have seen the Storm, Omnia or others?

Each device has it's good and bad points. The fact is that Cellular companies are only in charge of part of their network at best, and the and the handset shouldn't really be the determining factor of choosing an Provider At&T readily admits their network wasn't optimal for the number of users with the Iphone and they are now trying to remedy that so each user has a better experience. Only time will give a better indication

Exclusive handsets aren't necessarily a bad thing. It is just one factor that should be measured..

There really isn't enough spectrum to have true competition. The cost of the RF spectrum and cell site acquisition are the major factors for an operator.

Re:Get ready for Jitterbug handsets

[mjwx]

Without the iphone, would we have seen the Storm, Omnia or others?

Yes,

The same with Android. You forget that most of these products were in development long before anyone at apple even uttered the word iphone. Most of the new Nokia/Samsung designs are based on what has been available in Japan and Korea for years now. In mobile communications the west is so far behind the east it isn't funny.

Re:Get ready for Jitterbug handsets

[Archimonde]

There is competition amongst the operators to develop the best handsets.. Without the iphone, would we have seen the Storm, Omnia or others?

If I'm not very much mistaken, Apple developed the iphone. There isn't a competition between at&t and samsung. It is a competition between phone manufacturers. And even that is not very a good competition actually because nokia has continued to produce 50 versions of the 2 crappy phones a year, SE is nowhere, samsung is trying something as is LG (both have shitty mobile OS).

At&T readily admits their network wasn't optimal for the number of users with the Iphone and they are now trying to remedy that so each user has a better experience.

If iphone were available to all cellphone users, then probably all cell providers would improve their networks.

Exclusive handsets aren't necessarily a bad thing

Of course it is. Exclusive (in this sense) is just another word for lock-in and lock-in is bad by definition. Can you imagine how would it be if all had to buy computers from internet providers? You would be paying 10 times more for 10 times lesser hardware, and I hope you would like your monthly payments, and probably you won't even own the computer.

There really isn't enough spectrum to have true competition.

Since when? Even if there isn't enough of spectrum (which isn't true) some regulation would help to break down those lock-ins and other anti-consumer policies which would help with at least some competition. The problem we have now that there isn't a competition at all.

Re:Get ready for Jitterbug handsets

[rwwyatt]

If I'm not very much mistaken, Apple developed the iphone. There isn't a competition between at&t and samsung. It is a competition between phone manufacturers. And even that is not very a good competition actually because nokia has continued to produce 50 versions of the 2 crappy phones a year, SE is nowhere, samsung is trying something as is LG (both have shitty mobile OS).

There is a competition between AT&T and Verizon,Sprint, T-Mobile, etc all; and handsets are one of the areas of competition. The IPhone has some rather significant problems as well. Because the feature set is somewhat limited, the duct tape and bailing wire used to keep the Iphone functioning is not as obviouis

If iphone were available to all cellphone users, then probably all cell providers would improve their networks.

Some operators already spend a bundle on their network. If you have been with Verizon Wireless for sometime, you can remember the bad old days of Airtouch. In 2002, There was no coverage in significant portions of west Nebraska along I-80. In 2003, You were pretty much covered all the way into Cheyenne. I remember when AT&T/Cingular froze capital spending. AT&T has one of the slowest 3G networks in the world.

Of course it is. Exclusive (in this sense) is just another word for lock-in and lock-in is bad by definition. Can you imagine how would it be if all had to buy computers from internet providers? You would be paying 10 times more for 10 times lesser hardware, and I hope you would like your monthly payments, and probably you won't even own the computer.

The true fact is that we are loosing ownership rights faster than you can imagine. Do you run MS Windows? You license software and no longer own it. In fact, you can never even own your own home in most states because of property taxes. Ownership is an illusion.

Since when? Even if there isn't enough of spectrum (which isn't true) some regulation would help to break down those lock-ins and other anti-consumer policies which would help with at least some competition. The problem we have now that there isn't a competition at all.

Spectrum is licensed by the FCC and sold at a very tidy profit. How many small operators are going to be able to afford the 1 billion dollar upfront cost? The FCC also changed the rules allowing some operators to obtain upto 65 Mhz in one market. The real lack of competition comes in the backhaul. T-Mobile has to buy their backhaul from either Verizon or AT&T.

Re:Get ready for Jitterbug handsets

[rwwyatt]

Working in the industry, I can tell you phones have a really really short design period. Typically the design starts around 9 months before commercial availability.

If the Iphone had fizzled, all Smart phone projects would have been killed.

We actually have caught up to Japan for the most part. There are other technologies at play depending on the region in the east (CDMA, WiBro, WiMAX), but WiMax is dying

Interesting tag

[earlymon]

The suddenoutbreakofcommonsense is very interesting, but I'm not sure which way:

1. The handset sweetheart deals are creating haves and have nots and should stop.

2. Without the handset manufacturers having to bend over backwards to please the carriers, there might have been fewer, lower-cost, higher-quality handsets available.

When the handset makers can tell the carriers to take it or leave it, and when those handsets have features dictated by the consumers instead of the carriers (abysmal here in the US), and market competition irrespective of long-term contracts hits the handset pricing, then not only would that tag truly apply, but so would whatabreathoffreshairfinally.

Re:Interesting tag

[tknd]

Without the handset manufacturers having to bend over backwards to please the carriers, there might have been fewer, lower-cost, higher-quality handsets available.

There's no reason for this. In the current arrangement, the carrier is the customer to the handset manufacturer. If the handset manufacturer did not have to bend-over backwards for the carrier, guess who becomes the customer? The consumers purchasing the cell phones. Just because the customer changed doesn't mean that there would be fewer low cost handsets. In fact, as long as there are multiple players (competition) and there is demand (customers), the manufacturers will have an incentive to provide cheap phones. In fact, they've already been doing it for other markets.

who designs cell phones?

[Anonymous Coward]

Wireless carriers do NOT design cell phones...
They shop the vendors, request certain features, bells, whistles, colors, etc... Cell phone manufacturers design cellphones to meet the criteria. Some with, some without the OEM manufacturers logos on them/in them.

Carriers produce handsets?

[Dracos]

Then what do Motorola, LG, Samsung, RIM, Apple, Palm, Sony/Ericcson, Nokia, and all the other companies who aren't carriers but whose logos still appear on the handsets/batteries/chargers, contribute to the cell phone market?

Free Market?

[Bob9113]

But nationwide operators, including Verizon, maintain (PDF) that 'in the absence of exclusivity agreements, wireless carriers would have less incentive to develop and promote innovative handsets.'

Why are wireless carriers involved in the development and promotion of innovative handsets? Isn't the free market supposed to motivate handset developers to develop and promote innovative handsets?

Or do the wireless carriers not believe in the free market? I, for one, think the free market is a pretty good thing. You know, when it genuinely lets the purse-holder freely decide.

Aren't these the same corporations who cry "free market" every time the government tries to regulate them?

Perhaps, and I don't want to sound like a conspiracy theorist here, but just maybe; the wireless carriers actually are not objective supporters of the free market? Maybe what they want is not the free market, but laissez-faire capitalism. But then must we not ask, without a free market, how can laissez faire capitalism seek efficiency?

Re:Free Market?

[magamiako1]

Bob:

On a technical note, this is all something being done mostly under the "free market". That is, it's completely up to the handset providers and the carriers to decide, freely, for themselves, if they want to have exclusivity deals. And it's completely up to the end users if they want to purchase them or not within the constraints of these deals.

Beyond that, you get into very hairy situations.

The key point though, is "Free Market" does not necessarily mean "Fair Market".

I am in no way a supporter of a "free market" and I believe in heavy regulation and oversight from 3rd parties to ensure that we have a fair market for consumers. I'm just simply pointing out that you can't have "free market" and "fair market"--it just doesn't work.

Some people would argue that a free market is a fair market in that anyone who wants to enter the market can do so by coming up with a better product or service and offering that. But unfortunately, under a completely free market that wouldn't happen--since the larger providers would enter agreements to force you out of the market.

So at the end of the day, a free market system is not the best--and a regulated, fair market, ran by 3rd parties unrelated to the corporate interests of those involved is the best type of market.

Of course....whether or not we have that today is a completely different debate. I'm simply pointing out the flaws in a "free market" system.

Re:Free Market?

[Bob9113]

I am in no way a supporter of a "free market" and I believe in heavy regulation and oversight from 3rd parties to ensure that we have a fair market for consumers. I'm just simply pointing out that you can't have "free market" and "fair market"--it just doesn't work.

I suspect that we agree, but that I am using the term in a different way.

By "free market", I intend what Adam Smith intended: That the only decider of how dollars are spent, on a per-transaction basis, is the person who opens his or her purse. The silent hand.

Is the purse-holder the only decider here? No, the contract participants are making part of the decision. That is antithetical to the principles of a "free market".

What I am trying to do is to wrest back the term "free market" from the "laissez-faire" corporatists. "Free market" necessarily implies that the silent hand is unfettered. And as you note, that requires our government to punish anti-competitive behavior from time to time. But the interference need not be falsely accused of being a step toward socialism. Let us stand on principle, call it what it is, seize the high ground: We call upon the government to defend the free market from those who would inhibit the free action of the silent hand.

Also, consider this: Is the government not already interfering in this case? Whose courts, banks, jails, and guns give those contracts their force? Why it is the government. Of course, even in the absence of the government enforcement of those contracts, collusion would exist. But should we not first seize the high ground by calling this what it is? It is collusion, restraint-of-trade, anti-trust violation, &c. Do not let them hide behind the noble term "free market" or "contract." Contracts are obligations to perform services for consideration -- not restraints of trade that destroy the foundational silent hand of the free market.

Do not give an inch. Do not let those who depend on government interference to destroy the free market accuse you of favoring government interference that destroys the free market. We are those who believe in free competition, the free market, and the noble objectives of Adam Smith. They are the ones who wish to suckle at the government teat at the expense of market efficiency.

And if you have a minute more, allow me to share some Adam Smith quotes:

"The monopolists, by keeping the market constantly understocked, by never fully supplying the effectual demand, sell their commo-dities much above the natural price."

"The price of monopoly is upon every occasion the highest which can be got."

"People of the same trade seldom meet together, even for merriment and diversion, but the conversation ends in a conspiracy against the public, or in some contrivance to raise prices."

"To widen the market and to narrow the competition is always the interest of the dealers ... The proposal of any new law or regulation of commerce which comes from this order, ought always to be listened to with great precaution, and ought never to be adopted, till after having been long and carefully examined, not only with the most scrupulous, but with the most suspicious attention. It comes from an order of men, whose interest is never exactly the same with that of the public, who have generally an interest to deceive and even to oppress the public, and who accordingly have, upon many occasions, both deceived and oppressed it."

All those quotes come from The Wealth of Nations.

It is not the free market which is flawed, it is those who bear false witness about it, who destroy it. They are not us. We are the noble ones, you and I.

Re:Free Market?

[Anonymous Coward]

Apparently you do not know what a free market is. I suspect you vote Democrat.

Re:Free Market?

[Bob9113]

Apparently you do not know what a free market is. I suspect you vote Democrat.

Let's ask the expert, shall we? Adam, what do you think?

"To widen the market and to narrow the competition is always the interest of the dealers ... The proposal of any new law or regulation of commerce which comes from this order, ought always to be listened to with great precaution, and ought never to be adopted, till after having been long and carefully examined, not only with the most scrupulous, but with the most suspicious attention. It comes from an order of men, whose interest is never exactly the same with that of the public, who have generally an interest to deceive and even to oppress the public, and who accordingly have, upon many occasions, both deceived and oppressed it." -- Adam Smith, "The Wealth of Nations"

Re:Free Market?

[magamiako1]

We both do agree, I would just be more cautious with the usage of "free market" as it means a whole lot of things to a lot of different people.

Currently on the internet, the more popular definition and usage is along the lines of "a market that exists with no government interference. Corporations are allowed to do as they wish because if they do something that hurts the public, the public will respond by not purchasing their products."

The "invisible hand" in this case is the one behind the scenes with regards to the money. That in a perfect world, the businesses won't do anything that would hurt their profit--and the consumers won't purchase anything that harms their well-being.

Of course, we both know how much a load of BS that is--but that's the more widespread use, unfortunately :/

Re:Free Market?

[Eskarel]

The problem with the normal interpretation of the free market(ie the laissez-faire model), is mostly that it relies on a false assumption.

The false assumption it relies upon is that the free market will result in the lowest sustainable price being achieved.

This is false because if you have 50% of the market share, then unless you think you can grab most of the other 50% by lowering your prices(at which point you have no competition and the new monopoly can charge whatever they like) what happens when you lower prices is that you end up with +/- 10% of what you already had with lower profit margins, which is really rather stupid.

Now the theory for the free market is that if two established players with 50% market share don't want to lower their prices, that a third party will enter the market and since an increase in market share at any profit margin will be an increase in overall revenue. This only works however if the cost of entry is as close to zero as possible, which in the modern era, it almost never is.

The only way to have zero cost of entry to any market would be for a third party to own all the infrastructure necessary to enter that market and to provide it to anyone who wanted to enter that market at the same cost. The only viable option for that third party would realistically be some form of public trust, that is to say the government. So ironically, the only way that the free market results in the lowest viable price is through a form of socialism.

Re:Free Market?

[drinkypoo]

The only way to have zero cost of entry to any market would be for a third party to own all the infrastructure necessary to enter that market and to provide it to anyone who wanted to enter that market at the same cost. The only viable option for that third party would realistically be some form of public trust, that is to say the government. So ironically, the only way that the free market results in the lowest viable price is through a form of socialism.

You have committed fallacy by false induction, based on an illogical opening premise. A third party may enter the market even though the cost is not zero because there are additional benefits (e.g. brand recognition) to having a broader product range, and/or because they think they can take a large enough share of the market to make a profit. You are making the assumption that no one has more than zero dollars to invest in entering a new market, which is demonstrably false.

Re:Free Market?

[Bob9113]

Currently on the internet, the more popular definition and usage is along the lines of "a market that exists with no government interference. Corporations are allowed to do as they wish because if they do something that hurts the public, the public will respond by not purchasing their products."

We are stronger than them, for we have truth on our side. The definition of "free market" is well established in the literature, and their offenses against it are easily identified. If we, at every step, deny them their attempts to sully the term, and carefully, rationally, with supporting evidence demonstrate that their pretense is deception, we can take the term back. Today it is just you and I and our rationalist friends here on Slashdot. Tomorrow it will be a dozen blogs, Facebook pages, and Tweets. And the day after that, the world. The social networks are highly susceptible to simple, defensible, objective truth.

We do not have to fight on the difficult side of "Do you believe in the free market?" We are not on the difficult side. Do not allow them to push us around rhetorically, using the term for our principles as an emotional weapon against us. We are the defenders of the principles of the free market.

Never let them take our principles and wear them as sheep's clothing to gain emotional support. Yes, it will involve an uphill argument all too often at the beginning, but it is easier to explain to a typical businessman why the free market is what Adam Smith intended than it is to convince a typical businessman that "free market" should no longer be abstracted to "good thing" in his mind.

Let them have "laissez-faire." We can argue that one, and they deserve it. But give no quarter when they try to misappropriate "free market."

Re:Free Market?

[Bob9113]

Now the theory for the free market is that if two established players with 50% market share don't want to lower their prices, that a third party will enter the market and since an increase in market share at any profit margin will be an increase in overall revenue. This only works however if the cost of entry is as close to zero as possible, which in the modern era, it almost never is.

The free market is definitely not perfectly efficient in the short run. Through capital investment, however, it seeks efficiency in the long run. I believe that in natural systems, it does so better than other systems yet devised.

The underlying premises, however, must be firmly established. There must be no artificial barriers to entry (such as exclusive contracts). There must be no artificial barriers to perfect information (such as SLAPP suits). These and others are the areas in which the United States often fails to defend the free market from those who would destroy it, while claiming to be its supporters.

In this case, it is laissez-faire corporatists arguing for artificial barriers to entry who are damaging the ability of the free market (in the Adam Smith sense) to do as it is intended. It is those who attempt to frame anti-trust violations as "contract" or "free market", when in fact they are laissez-faire abuses of the free market (in the Adam Smith sense).

It is not the failure of the free market in this case. It is a failure to optimize the free market for the free action of the purse-holder. It is an offense against the free market, not an example of it.

I think it is worth reading again what Adam Smith has to say about exclusive contracts:

"To widen the market and to narrow the competition is always the interest of the dealers ... The proposal of any new law or regulation of commerce [emphasis mine] which comes from this order, ought always to be listened to with great precaution, and ought never to be adopted, till after having been long and carefully examined, not only with the most scrupulous, but with the most suspicious attention. It comes from an order of men, whose interest is never exactly the same with that of the public, who have generally an interest to deceive and even to oppress the public, and who accordingly have, upon many occasions, both deceived and oppressed it." -- Adam Smith, The Wealth of Nations

An exclusive contract is, precisely, a regulation of commerce. This regulation of commerce should, as Adam Smith said, be carefully examined with the most suspicious attention before being adopted. And, I believe, "wireless carriers support the development cost of handsets" is far too thin a rationalization for this offense against the free market and the silent hand of the purchaser.

Re:Free Market?

[Eskarel]

It does happen, but generally speaking not in the way postulated by most free market theorists.

The premise for reaching the best price is that if the existing companies don't reduce their prices, there will always be someone who will. This is demonstrably false, there are plenty of markets where the cost of entry is so high that the cost of production for any new entrant is so high that they cannot possibly compete on price with the existing players, not even counting cases like Microsoft where the structure of the market itself guarantees that competition cannot effectively compete.

I'm not saying that socialism is a particularly good idea, or that the free market doesn't work.

What I am saying is that the free market in and of itself does not produce the situation that a lot of people seem to think that it does. Simply leaving companies alone does not mean that over the long haul consumers will be better off. The government has a place in managing the economy and ensuring a certain amount of fairness as well as freedom is present within the market.

letter to whom?

[damn_registrars]

Why on earth would any reasonable person expect a letter to the FCC to accomplish anything? I've tried to contact the FCC before and they just respond with the same canned response every time, telling me they cannot do anything. Might as well send a letter to Santa.

Re:letter to whom?

[Anonymous Coward]

Why on earth would any reasonable person expect a letter to the FCC to accomplish anything? I've tried to contact the FCC before and they just respond with the same canned response every time, telling me they cannot do anything. Might as well send a letter to Santa.

You aren't four current US senators.

Exclusivity ONLY for limited time.

[Anonymous Coward]

Why can't we just get an exclusivity for LIMITED amount of time, say 3 or 6 months?

There is so many new phones on the market that a 6 months old headset is already old and out of fashion (unless it's the iFruit one), and then there is absolutely NO POINT of having it exclusive for one network only.

I know that the idea of exclusivity is basically to grab customers from other networks, as almost everyone has a mobile phone nowadays (and some people have more than one handset).

typical...

[whipple-spree]

It seems, when given the option, that most big business will try to strangle the hand that feeds them. Cheap and reliable communication has been a keystone of American business, both domestic and foreign and here we are trying to catch up because business is too damn greedy/short-sighted for their own good. Their argument has nothing to do with innovation. It has everything to do with making money by not rolling out a more expansive, more reliable network. Who suffers? America does and it's not like they can just pick up their network and plop it down somewhere else.

Follow the Money trail

[freedom_india]

Instead of debating it in Senate (which exists solely for debates), why put it to Commerce Committee and why now?
The answer can b e got here. It says a former tech exec has joi ned the committee.
Which means he is trying to pre-empt any legislation by the Congress by putting it for consideration in the committee.
Which effectively kills any legislation and also protects the interests of telecoms.
Sneaky, disgusting and probably illegal.
But then the senate has a record of disgust. So nothing new here.

Verizon is funny.

[cyn1c77]

But nationwide operators, including Verizon, maintain (PDF) that 'in the absence of exclusivity agreements, wireless carriers would have less incentive to develop and promote innovative handsets.'

You've got to hand it to Verizon for trying to confuse the congressmen with idiot logic. Are wireless carriers really developing innovative handsets? (or handsets at all)

I am trying to think of more than 3 revolutionary handset lines besides the iPhones, the Blackberries and Nokias. I guess we can throw in Motorola for their early efforts and Sony Ericsson for cute design too. But where are the carriers?

I think Verizon is really pissing their pants because they are thinking "in the absence of exclusivity agreements, wireless carriers will have a harder time locking down good phones with carrier-specific crappy software."

In theory, non-exclusive phones would also reduce the number of overall phones brought to market and increase the quality since the developers would be competing against a larger market.

Really, with non-exclusive handsets, both consumers and cell phone companies win. Large carriers will be the only ones losing... they will have to choose between market share, profit, and handset control. Of course, who are we kidding, nothing is going to change because they probably own half of the senate.

Re:Verizon is funny.

[dkf]

Of course, who are we kidding, nothing is going to change because they probably own half of the senate.

I think that's unlikely. Big Oil won't put up with not being #1. (And the senators know that doing stuff that pleases their constituents at least some of the time is a good move, so helping constituents get "ooh! new shiny!" would seem to be to the advantage of those seeking reelection.)

Yeah right.

[Anonymous Coward]

Suck it BITCHES. Let's see the situation here in India. Generally nearly every handset is unlocked and you can change providers willy-nilly (aside from the background check they do on you cause OMG terrorists use cell phones). And guess what? We pay full price for our handsets no cheap cell phones like in the US. Then again we have plans that are like lifetime based and even the companies sticking to old tech like CDMA give incentives like free calls to any other mobile on the CDMA network so it all works out well.
Here's the kicker. The iPhone. That shit was bound to exclusive carriers, Airtel and Vodafone. You had to buy a package deal with one or the other to get the iPhone. They even did this for the iPhone 3G [i]when we didn't have 3G in the country[/i] and I'm damn sure none of those numbnuts who bought it are ever going to use the internet on their shiny gadget.
But that's not enough for teh greedy bastards. Along with being tied to the networks they charged EXTRA for the privilege of having an iPhone, they charged double of what Americans paid AND it was bound to their networks. And people bought it. They were charging 10k more than the black market that had unlocked iPhones for sale and a week after the black market raised their prices cause the commercial ones were getting away with the ridiculous price!
FUCK YOU BITCHES for complaing that they need a monopoly to justify innovation.

I use to be a technician for U.S. Cellular

[Anonymous Coward]

They are 100% C.D.M.A 1x evdo, but have bumped up their data network since I left from what I understand.

Amazingly, Verizon phones work... as phones

[Anonymous Coward]

Flawless reception... a rare quality in a phone theses days.

Ugh!

[yoshi_mon]

The whole cell phone market and carriers is overall pretty twisted and generally nasty. I kept myself willfully ignorant of most of it until recently. (I was happy in my ignorance too...sigh.) But my old Palm IIIc was not going to live forever so I thought it was time to finally update my knowledge on ultra-mobile computing.

What I found out right away was that what I really wanted was a Nokia n810 but that it was not going to be a phone. Nor was it going to be online unless I was tethered or on Wifi. Not a huge deal given that those were the only real major downsides. And to make a long story short I did finally end up with a n810 which I love. My biggest complaint is that it is a little big & heavy but overall I'm very pleased.

But at a point the new n810's were out of stock everywhere. I looked around for a used one but it was slow going so I thought I should look at a smartphone option vs my old setup, dumbphone & PDA. Both setups have their pros and cons and at some point I might go smartphone & tablet (I guess calling the Nokia devices PDAs felt passe.) but I digress.

Finally getting to my point here when I looked at the options with smartphones I got pretty annoyed pretty quick. The fact that they mask the price of the devices with rebates and contract requirements is not good. The fact that not only are not all of the devices available on all the carriers but that each carrier can have their own set of rules on how the devices will function is annoying. Nevermind that even if you do have a device that can be used by multiple carriers most if not all of them won't turn it on unless it has their tag on it.

None the less I eventually found a smartphone that I thought I could live with and set about trying to negotiate upgrading my old phone to that with my carrier. I felt like I had walked into the sleezyest of used car dealerships with 'Mark' written on my forehead in glowing ink. The idea that I did not want to upgrade to a plan that was 2 to 3 times what I was currently paying for the privilege of using this phone resulted in political levels of feigned outrage.

In fact when I would be asked about what I was looking for and outline my needs the idea that I don't spend half my day texting seemed downright shocking to these reps. The fact that what I really wanted was a block on all texting on my account had them looking for wooden stakes. For kicks I went to an AT&T rep at one point and worked in the term 'jailbreaking' as often as I could into our conversation. To his credit he did what he could to sell me but developed an unhealthy tick in his left eye.

To me the whole cell carrier/phone business needs a lot of work because from top to bottom it's a mess right now. Hopefully that a light is being shown on some of their nonsense will clean some of it up.

Re:Ugh!

[Renraku]

I doubt most people working in cell phone stores have any idea why their phones are crippled.

They're there to sell FEATURES, not limitations. They don't say that this phone can't be tethered to your computer, they sell you an unlimited data plan (phone only) and a tethering cable. Then they cackle with glee when they see that $.75/kilobit charge on your bill to the tune of $750.00. Should have read the contract, eh?

At any rate, you COULD use bluetooth to upload pictures or download ringtones from your computer to your phone, but its been disabled in the firmware. Also, you COULD use that built-in GPS with Google Maps to see where you're at, but that's disabled too unless you subscribe to whatever GPS mapping software they're getting kickbacks from this year.

The whole market is a perfect example of what would happen if 'trusted computing' ever took off. There would be no more of this "I didn't like the drivers so I installed hacked ones" or "Hey my nVidia card is a higher model that's been flashed to be a lower model, let me reflash that so it can be awesome again"

Re:Ugh!

[drinkypoo]

At any rate, you COULD use bluetooth to upload pictures or download ringtones from your computer to your phone, but its been disabled in the firmware. Also, you COULD use that built-in GPS with Google Maps to see where you're at, but that's disabled too unless you subscribe to whatever GPS mapping software they're getting kickbacks from this year.

Stop. Patronizing. Verizon.

I have had fairly smart phones (bluetooth, data etc) from T-Mobile, Edge Wireless, and AT&T. Each one has had all features enabled. Furthermore, except for my RAZR V3i from Edge, each phone was free. Right now I have an HTC Fuze which was free. The GPS works great with Garmin (which I added) and even the AGPS functionality works great.

Re:Ugh!

[yoshi_mon]

I have had fairly smart phones (bluetooth, data etc) from T-Mobile, Edge Wireless, and AT&T. Each one has had all features enabled. Furthermore, except for my RAZR V3i from Edge, each phone was free. Right now I have an HTC Fuze which was free. The GPS works great with Garmin (which I added) and even the AGPS functionality works great.

The thing is, going to hit up the car analogy here, is that we should not have to deal with all the BS that the carriers do. It is as if I went online and found that the car I really wanted to buy was a Toyota Prius. But then when I went to DealershipX I found out that the AC was going to be disabled when I bought it. DealershipY of course sells the Prius' with AC but if I then want to get my service from them I'm going to have to drive 100m every time.

A crude example but you can see my point I'm sure. The fact is that from nearly start to finish getting anything but a basic cell phone and using it to talk only is an awful process. Full of all sorts of convoluted issues designed to confuse the buyer such that they just give up on trying to actually understand it all and just sign on the dotted line.

My thing is this when dealing in our capitalistic society: When looking at the profit that someone is going to make off me I don't mind helping put their kids though college. I do however draw the line at buying them a boat at the same time. Sell me what I want at a fair price and it's all good. Currently however walking into a cell phone store makes me feel like I'm walking up to a carnie booth with that 'Mark' glowing ink on my forehead.

Re:Ugh!

[drinkypoo]

The thing is, going to hit up the car analogy here,

You're not allowed to make a car analogy here, because you're allowed to make replacement parts for your car even if they are covered by patent, and you're even allowed to sell replacement body parts for cars even though their design is protected by copyright.

My thing is this when dealing in our capitalistic society: When looking at the profit that someone is going to make off me I don't mind helping put their kids though college. I do however draw the line at buying them a boat at the same time.

When it comes to cellphone service, you don't have a choice about that, because all the players in the market are colluding on gouging you for stupid shit like SMS.

I find it odd that Verizon is taking that stance

[Cyberllama]

After all, it seems like they're truly on the losing end of the whole "exlusive handset" thing. In fact, when I hear people decrying iphone on AT&T, Verizon is one of the names I hear most frequently as the network they'd much rather have it on. I mean sure, Verizon had some decent phones -- but everyone these days wants a smart phone and verizon has almost nothing to offer in that department aside from a few "meh" Blackberries (which aren't all that exclusive). Sprint has the Instinct and Pre, T-Mobile has the G1, and AT&T, of course, has the Iphone. Verizon has . . . Nada for smart phones?

I don't know if this is just Verizon truly standing on principle (which seems unlikely), or simply the old guard of Verizon executives not realizing that the tide of exclusivity has actually turned against them in the last year or so and that they really no longer benefit from the idea of handset exclusivity since their rivals currently benefit far more it. Perhaps they're assuming that manufacturers of GSM devices wouldn't necessarily make CDMA versions if there was no exclusivity contracts. I can sorta see how their position might make financial sense if they only gained access to the Palm Pre and not the iphone due to lack of CDMA iphone.

I've got to imagine that if every Phone was available on every network tomorrow, Verizon would be in far stronger market position by being able to offer the Iphone than they would be by losing exclusivity on whatever junk they currently have. Their plans are cheaper, and their 3g coverage is superior to AT&T's (at least from my experience). I just can't imagine AT&T could compete with other providers for iphone contracts on a level playing field. Worse still, the cost of exclusivity just gets dumped on the customer. Iphone plans are about 20 bucks more per month than a similar plan for any other phone would run you . . .

Carriers need to do ..

[Anonymous Coward]

The thing they were setup to do carry the signals if a phone works on net1 it should also work on net2 and 3 and 4 ect this is one of the reasons i hope that Apples i phone will fail in the long run because it is tied to certain carriers only i do not purchase a phone unless it can be unlocked and work no matter whose sim i insert , you should not be forced to change your phone because you are pissed with a certain carrier i was there with T-Mobile so canned there sim in went an orange sim back for what cost i think it was 4.5 sterling and in a few seconds (the beauty of a fully unlocked 4 band phone)

Yup, it's the carriers

[Colin Smith]

If the carrier doesn't market the phone then the manufacture will

There is no point manufacturing something and marketing it (both *hugely* expensive operations) if the carriers are not going to provide it to customers, and customers can't switch to competing carriers who will.

US handsets are in general a year or two behind the handsets available in the rest of the world largely because of this. The US mobile comms market is a nice little walled garden for favoured (by the carriers) manufacturers. Take a look at the handsets which Verizon actually provides vs what the *same* manufacturer provides to the rest of the world.

Nokia (largest phone manufacturer in the world) for example:

Verizon:
Nokia 7205 (silver keypad)
Nokia 7205 (pink keypad) just LOOK at that innovation...
Nokia 6205
Nokia 2605 Mirage

All (wow, a whole, 3 of them) of these are ancient.

And take a look at the handsets available from Nokia:

http://shop.nokia.co.uk/nokia-uk/searchresults.aspx?page=1&culture=en-GB&search_id=47&chka=0&chkp=1&pagesize=9999&sortorder=desc

124 produced and available (in the UK) vs 3 from a carrier.

The rest of the world, the carriers want the latest phones and network services because if they don't provide it, someone else will. The US, far less incentive, you take what you're given. I like the spin that monopoly promotes innovation though.

I doubt it would hurt the manufacture at all.

Not the manufacturer. You are the one getting the bad deal.
 

What bullshit...

[Anonymous Coward]

in the absence of exclusivity agreements, wireless carriers would have less incentive to develop and promote innovative handsets

Carriers don't develop shit, they sell it. Who do they think they're kidding?

And no reason to promote "innovative" handsets? Here's a reason... YOU want the money the customer pays for it, instead of it going to $GENERIC_OTHER_CARRIER.

Oh my gods. We actually want them to compete on quality of service??? Have we all gone MAD?!

Equalization of Opportunity Bill

[Weeksauce]

This kind of reminds me of the "Equalization of Opportunity Bill." If you can't swim then maybe you don't belong in the pool.

Verizon actually cripples their phones!

[Anonymous Coward]

The truth is that not only don't carriers develop the phones, some of them (verizon being the worst offender) actually cripple the ones they market.

Re:I find it odd that Verizon is taking that stanc

[Vegeta99]

I thought it kind of odd too for Verizon to support this. The weirdest part is the summary, saying that wireless carriers would be less likely to innovate. The only carrier branded phone I had was an AT&T Tilt, and that was actually just a HTC TyTN II. So I don't know what they're going on about.

In reality, they just don't want to lose control over what goes on their phones, and that's why they support this. If I had to hazard a guess, I'd bet that Verizon doesn't have more "exclusive" or quality phones is because they want to have too much control over what goes on them. My iPhone is pretty easy to jailbreak, the Tilt never even cared (and for that matter, was completely and utterly unlocked - not just SIM card, but radio software and all - in minutes), and AFAIK, I was always free to run my own BREW apps on AT&T's selection of just-phone phones. Verizon? Not so much. My girl uses VZW can't even get a Spanish dictionary for free, and I've got one on my iPhone, my PC, pretty much anywhere I need one.

at the same time, on another continent...

[vegiVamp]

...Europe is trying to tell Belgium that it should abolish the ban on linked sales, and thus allow this kind of exclusivity deals. Since when did you lot get your hands on our common sense ?

free market

[Aggrav8d]

nationwide operators, including Verizon, maintain (PDF) that 'in the absence of exclusivity agreements, wireless carriers would have less incentive to develop and promote innovative handsets.'

That's fine with us! Don't develop the handsets. Focus on building your network's reliability and lowering your cost to consumer. Let someone who knows what they're doing build the handsets.

What's that? Handsets make a lot of money for you? Well then I guess you'll have to do a better job than the 3rd party developers. So much for less incentive! Just when you thought you had all that nasty competition wrapped up, free market forces come along and ruin your day.

Thank you Verizon

[Anonymous Coward]

No if's or but's about it carriers are hindering the advancement of handsets or more appropriately mobile handheld interface consoles. Yes they may be saving us a few bucks here and there by having exclusive partnerships with manufactures and investing in research and development, but at the cost of providing the consumer the choice of having one single mobile device that can connect to any carrier (for a fee) or any WLAN, tether to any computer, act as a remote to your TV and entertainment system, or be a game controller with your personal stored game stats. The possibilities are only limited by the need of large national carriers to control and get paid for each and every unique way one could use such a device.

I believe we could be heading to a time when we all have just one handheld mobile device of a design of our choosing that can act as our own personal ubiquitous interface device to the various systems and networks we chose to access during the course of our daily lives. The only true obstacle to this progress is the need for large carriers to control and get paid for each and every possible function of a device.

Carrier captured handsets are in the long run extremely destructive to innovation and progress.

So yes, 'in the absence of exclusivity agreements, wireless carriers would have less incentive to develop and promote innovative handsets.', is exactly what the Commerce Committee needs to enforce. I would like to thank Verizon for stating the obvious and openly admitting they need/want to control handset innovation and progress without any open competition.

Verizon's own assertions are why senators must act.

You have no right to a phone

[Anonymous Coward]

While I would prefer it if I could use any handset on any network that supports it (CDMA vs GSM).. which you can to a large extent if you buy the phone and switch the SIM card on GSM (My friend has a G1 on AT&T) my problem with this idea is the idea that one has a right to whichever handset they want.. you have no right to a phone period. Leave the government out of this and vote with your feet. You don't like AT&Ts network, but still want an iPhone? Well, buy one and put it on another GSM network or don't get one. Make your choice, but you have no right to an iPhone, let alone an iPhone on the network of your choice. Quit whining. Forcing a change here would violate contract law and freedom of association.

The legitimate function of government is protecting our rights, not making your wishes come true.

Re:You have no right to a phone

[JSBiff]

The problem with your statement is. . . how do you buy an iPhone without getting into a 2 year contract with AT&T? Ok, I suppose AT&T probably offers a (much more expensive) non-contract price to buy the phone, so you can probably do that (I'm not sure in this case - maybe they only offer the phone if you sign the contract?).

But more importantly, the phone is software-locked to the AT&T network.

Generally speaking, though, I too am of a libertarian mindset here - I agree that that government should be limited in how much it interfers in business relationships and contracts. If Apple freely chooses to sell iPhones only to AT&T, then it should have the freedom to do that. . .

My problem comes in the fact that Apple can lock the phone to AT&T's network, and then the DMCA can potentially be used to prevent me from hacking the phone to unlock it (or at least, prevent someone who has figure out how to hack it from distributing patches/software to unlock it). Yes, I know that the copyright office issued a DMCA exemption for unlocking cell phones, but that isn't a permanent change of law - that's just a (currently) temporary exemption.

So, on the one hand, the government has no business trying to force companies to not do exclusive hardware deals. . . but on the other hand, IMO, the government has no business 'protecting' businesses by making it illegal for people to modify the software in their cellphones to work with other networks, or even for third parties to assist (heck, other cell-networks and their vendors should be able to assist me in hacking my phone to work on their network).

The legitimate function of government is protecting our rights, not making wireless corporations' (or any other copyright holders') wishes come true.

OT: Old Macs vs PCs

[sgtrock]

If Total Cost of Ownership had been a common process, Apple should have owned the business market after it introduced the Mac (shorter training, fewer crashes, etc.). But people looked at Macs, saw a $3500 price, looked at a PC-AT, saw a $2500 price, and the rest, as Bill Gates might say, is history.

No, not really. You're forgetting how locked down Macs have always been. The first Macs had no expansion capability at all; just one floppy drive, a minimal amount of RAM, and a tiny black and white screen. This, at a time when people were already getting used to much larger color screens to do their word processing and spreadsheets in. Standard PCs of the day had two floppy drives. Hard drives had just gone from being an extremely expensive option to just barely affordable for a standard desktop.

In addition, you're forgetting the very active expansion market. People were plugging all kinds of peripherals and cards into PCs. Doing so with a Mac was difficult if not impossible. That made Macs a non-starter for a lot of markets.

What Congress should really be investigating. . .

[JSBiff]

In my opinion, a far bigger problem than handset exlcusivity deals, is the practice of charging customers the same price for cell phone service whether or not they are or are not getting a contract for a phone. Most of the carriers will let you buy phones outright, and even pay month-to-month for service. The problem is, I'm paying the same monthly-fee as if I were on the contract. So, it ends up being financially stupid to buy a phone outright, because you're just paying an extra $200-$300 (in most cases), but not paying less for service than the people whose phones are subsidized by the contracts.

If I'm not getting my phone subsidized, I should be seeing about a $10/mo discount on my service. But, no.

Get rid of that nonsense, and also give people the legal right to modify their phones to unlock them from the original network, and you've solved the 'exclusivity' problem in the simplest possible fashion.

I think Apple is behind this...

[Anonymous Coward]

Consider... at the last WWDC, Apple took a lot of ribbing about AT&T being slow to add MMS and tethering. iPhone users complain about slowness, dropped calls, etc. Apple is stuck in its agreement until 2010 unless it can convince AT&T to let go, which AT&T won't do because the iPhone brings in too many customers and locks them in once they're there (ignoring jailbreaking and such).

Not too coincidentally, Sprint just announced an exclusive deal for the Palm Pre, and already offers the Blackberry. This makes it a purveyor of the two biggest competitors to the iPhone. There is a waiting list at many Sprint stores to get the Pre, which shows that Sprint is on to something. But the Pre needs work to be a serious competitor to the iPhone, though the Pre is a nice phone already. If Palm was forced to drop the exclusive with Sprint, it would have to focus effort on modifying the phone to work on other carriers, slowing the addition of new features and applications (which means it would be less effective at competing with the iPhone). So killing exclusive handset deals might actually hurt the Pre. But it HELPS the iPhone, since it allows Apple to move the phone to more carriers (something that Apple's been doing internationally, so adding more U.S. carriers ought to be relatively trivial).

Then there's Sprint. It's one of very few networks that can't use the current iPhone, which is GSM-based while Sprint's network is CDMA-based. Taking away Sprint's exclusivity for the Pre would hurt one of its best chances for survival and success in the coming months. Killing off Sprint and the other CDMA carriers saves Apple lots of expense in having to create a CDMA-based iPhone model.

There's an old saying that if you want to know what's really going on, follow the money. While killing off exclusivity deals would help small carriers and the consumer, we all know lobbyists and politicians rarely pay more than lip service to small business (even though they should) and consumers (even though we elect them). So the question is, where does the "real money" in this deal go?

Let's see... Apple gets out of its AT&T deal without penalty, saving face and selling lots more iPhones on more U.S. networks (without losing overseas exclusivity). Development of the most-likely rival to the iPhone is set back by a need to support more carriers, which benefits Apple and the iPhone. Severing the exclusive deal between Sprint and Palm sticks a knife into Sprint, which was already in trouble anyway, and which just happens to offer the two best alternatives to the iPhone. Looks like lots of money flows Apple's way if this goes through, and Apple loses nothing if it doesn't.

Just to make the tinfoil hat scenario complete... Consider that Al Gore (former Democratic Vice President of the U.S.) is on the Apple Board of Directors, and that this particular anti-exclusivity effort is headed by fellow Democrat John Kerry. It doesn't take too much of a paranoid fantasy to imagine Apple management going to Al Gore and asking for help getting out of the AT&T deal early, Gore calling up his old buddy John, and John suddenly "noticing" all these letters he's been getting from small carriers over the years wanting an end to exclusive handset deals.

Al Gore connection not enough? Consider also that Apple CEO Steve Jobs was a consultant on the John Kerry campaign. Don't believe me? Search on Google for "Did Apple contribute to John Kerry campaign" and see what you get.

I'd like to think that Apple and Steve Jobs aren't that "evil" but this timing is awfully coincidental...

Hey Mods! The parent comment is right on topic!

[Anonymous Coward]

Wankers.

But I do in fact disagree Colin. /.ers don't see it, but the US expectation of handset "assistance" is vastly higher than it is in Europe. The EU carriers will support a handset they sell you, but their customer care folk don't have all 124 handsets sitting around to walk you through the menus when you've misprogrammed your APN, or reset the low-level SMS delivery systems when you hardcode the wrong network address for delivery.

People in the States want their hand's held, and to call someone and get "anything they think their phone should do" fixed. For 1.2x minimum wage folk, that means considerable time and training goes into every handset.

I'm not saying carriers don't use this to their advantage and make some extra money off it, I'm saying you pay for what everyone else is getting from your carrier too.

I use a GSM carrier, they treat my Mom well when she calls in using one of their phones and can't get her pictures onto her computer, and I use whatever cool handset I like, but (gasp!) purchasing it for what the manufacturer is asking.

One might argue its the best of both systems.

True innovation

[Anonymous Coward]

So carriers would not be motivated to create innovative handsets???

Is this a problem? I mean, when I get a new cell phone, the first thing I always want to do is go out and reflash it with a non-crippled firmware because my carrier chose to "innovate" by disabling the truly innovative features the manufacturer provided, and instead load it up with private branding, and ring-tone store applications that I don't want or need.

Whaddya mean, "turds"?

[ibsteve2u]

I had one for a minute, and I couldn't hear shit!