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FCC To Probe Exclusive Mobile Deals
On Tuesday, we discussed news that four US Senators would be looking into the exclusivity deals between carriers and cell phone makers. Apparently, they didn't like what they heard. Reader Ian Lamont writes with an update:
"The Federal Communications Commission is planning on launching an investigation into exclusive handset deals between mobile carriers and handset makers. In a speech on Thursday, acting FCC Chairman Michael Copps said the agency 'should determine whether some of these arrangements adversely restrict consumer choice or harm the development of innovative devices, and it should take appropriate action if it finds harm.' It's not hard to imagine who might be targeted — at a separate Senate Committee on Commerce hearing on Thursday, much of the discussion centered on AT&T's exclusive deal to carry the iPhone. AT&T claimed 'consumers benefit from exclusive deals in three ways: innovation, lower cost and more choice,' but carriers and senators from states with large rural populations disagreed, saying that their customers had no choice when it came to the iPhone — it's not available because AT&Ts network doesn't reach these areas. One panelist also brought up the Carterfone precedent (PDF), which concerned an 'electrical acoustic coupling device' that a man named Tom Carter developed in the 1950s to let field workers make phone calls using a radio transceiver connected to AT&T's phone network. AT&T, which was then a monopoly, claimed no foreign devices could be connected to its network, but lost when it challenged the Carterfone in court. The result spurred innovation such as the fax machine."
Four Senators want iPhones but don't want to leave Verizon...
As with everything, until it inconveniences a Senator directly they don't see it as a problem
There's AT&Ts recent withdrawal of the iPhone from Pay As You Go availability.
Basically, if you want an iPhone on an affordable plan, you can't get it, because AT&T doesn't offer PAYG and because affordable operators like MetroPCS can't offer one either (yes, I realize MetroPCS isn't GSM, it's just an example).
http://lkml.org/lkml/2005/8/20/95
In response, Roth argued that exclusive deals enable innovation because the operator and manufacturer share the risk. He suggested that operators will ask manufacturers for certain features on phones but manufacturers will often only do so if the operator agrees to buy a certain number of phones, he said.
Corporate trusts are not supposed to decide what features go into products. That is one of the reasons that anti-trust regulation exists. Picking features and rewarding risk takers is the exclusive domain of the silent hand of the market. If you want to share the risk and get some exposure, then buy corporate bonds or non-voting shares from the handset manufacturer that pleases you. It is not a cartel or lateral monopoly's prerogative to manipulate decisions about product features.
The reason it is not the prerogative of trusts, cartels, or monopolies is because they are worse at it than the free market. Demonstrably so:
Did you notice, for example, that it took a computer company -- that had never had anything to do with cellular -- entering the market to finally get a smartphone that didn't suck into the US market?
Did you notice that the second acceptable smartphone came from a search engine company that had also never done cellular before?
Did you notice that that second smartphone got relegated to a third tier provider because the big boys were too busy sucking each others dicks to be bothered with an innovative product?
Did you notice that prior to the iPhone, America had just about the crappiest phones in the entire first world? Tiny little Taiwan was about a decade ahead of where we would be today were it not for Apple -- a complete outsider to your supposedly "innovative" little idiocracy.
You guys have been using your cartel to sit on your lazy, incompetent asses. Just like the auto manufacturers, except that Southeast Asian companies have a much harder time getting variances for cell towers than you, you fat, lazy fucks, so they haven't managed to kick your ass all up and down like they did to the auto makers.
I understand that you want to dictate features and restrain trade, but as it turns out, the free market(*) is a more efficient solution. So shove your transparent cartel rationalization up your ass and get out of my face.
Well, that's what the Senators should have said, anyway.
* Not laissez-faire, not anarchy: Adam Smith's free market, including regulation of anti-competitive behavior. Go re-read The Wealth of Nations if you doubt me.
Stop-Prism.org: Opt Out of Surveillance
1. Be able to buy your phone from anybody who sells them.
:)
More stores selling more phones has to lead to lower prices
2. Then choose your carrier.
Kill the link between phone brand & model and the company that provides your service. And for God's sake kill those 2-year contract extensions!
Maybe these Senators are on the right path -
there's a first time for everything.
I think the idea is that when ATT didn't service an area where service was needed, it not just temporarily, and their rules prohibited the connection of outside devices to it's phone network was shot down in court because it harmed customers.
Much to the same here, ATT or any cell carrier not servicing some areas and locking the devices out from service there, it has the same effect as locking out competitors. We have to remember, as long as the cell phone companies use the wireless spectrum, they have to operate for the public's need or benefit. It's a condition of their license. They can do it at a profit but when they fail to provide to enough of the public, then the same concept applies that drove the carter phone ruling.
Apple first went to Verizon but was turned down. AT&T was the only company that would let them do the iPhone, so they got it. Now everyone is crying foul because AT&T is stealing millions of customers. AT&T has every right to keep their deal with Apple. Just wait a few more years and the iPhone will be open for everyone, just as iTuned came to the PC. Apple's best interest is to sell the iPhone everywhere but has an obligation to repay AT&T for making all this possible.
Every carrier is a crappy carrier.
This has nothing to do with spectrum, and is not the FCC's jurisdiction. The FTC should be investigating this - and in 2006.
(Unrelated - why does my Karma bonus not work any longer? My Karma is Excellent)
as an iPhone owner i'd like to pose a thought specifically re: iPhone and AT&T service. I live in the NY,NJ,PA tri-state area where AT&T has less than reputable service. (in much of the US AT&T has fairly good coverage) i've been with AT&T for over 10 years (from Cingular) in multiple locations in the US. i've never had any issues whatsoever with my phone service until i got my iPhone. now i will be the first to admit i _really_ like my iPhone, i like it enough to spell it with a capital "P" and lowercase "i". i dont even capitalize myself when i say 'i'. that being said, the iPhone has dropped calls more times than i possibly can fathom! i'm sure i've dropped over 250 calls minimum in the past 8 months or so that i've had the device. prior to this, i've only ever dropped 1 call in 10 _years_ with AT&T. i am dissatisfied with AT&T service plans but i have to recognize there is a possiblity that the iPhone itself has some real issues, it may be just the way it works with AT&T service (if anyone has any experince with other carriers, O2, the canadian one or whatever please ceel free to add your experience.) it may be the device, either way i wont know for sure till i can take my iPhone to another carrier.
i wage a holy war against the apostrophe.
I save at least $50 on T-mobile using an iPhone and unlocking it (my wife has one also, so it's a shared plan). ATT has taken advantage of the iPhone to tack on the $30 data plan per phone, which is quite a bit more expensive than most other plans with similar service.
I haven't fully decided if the iPhone penetration has reached a point where the government should be regulating them, but for ATT to argue that their deal really helps make things cheaper is bullshit.
They don't pay for insurance coverage... it's just free medical care with highly prioritized and preferential treatment. That's one of the big problems with healthcare -- legislators never see the problem because they never experience it and those who have quickly forget it once they enter that arena
Which is why we if we want the health care problem solved, one essential step will probably be insisting legislators and their staff have no access to any kind of group health care policy.
Mind you some of them are probably well off enough this wouldn't be a particular inconvenience, but the staff thing ought to do it.
Tweet, tweet.
The deal with old phones is that there was a FCC mandated sunset of non-e911 capable phones.
You could maintain already activated phones, but couldn't activate - or reactivate those phones after that date.
You're dredging up old news - there are very few people with 6 year old non-e911 phones.
And yes - there are still valid technical reason for not being able to transfer hardware.
You can't use an ATT or T-mobile gsm phone on a Verizon cdma network.
Or an ATT tdma phone on an ATT gsm network.
Cellular carriers are less monopolistic than ever before.
There are fewer players now, but with their expanded networks, they are now most all in direct competition with each other, rather than the almost feudal state that existed in the days of patchwork coverage areas.
[iPhone drops on tower handoffs in SF south bay area.]
Something is clearly wrong with their tower firmware and this is a *recent* problem. It worked flawlessly in these same spots until just a few months ago, and it does reestablish access to the tower with full bars after a few seconds if you sit at one of these "dead spots". ...
The only other possibility would be a baseband crash, but that seems unlikely to occur so consistently during tower handoffs. Also, I often have full bars within a fraction of a second after the call dropping, ...
IMHO another possibility is network saturation. If you have to switch to a new tower or pie-slice because you're losing the old one, and all the slots in the new one are in use, you're hosed until a slot frees up. Park in the "dead zone" and eventually somebody will hang up or move on and the tower will give you a slot. Meanwhile the phone can hear the tower (and its control channel) just fine, so you get bars but no audio. (You'll also be able to send and receive text messages, which are on the control channel. But try to make a new call and you'll get all-trunks-busy.)
This doesn't require a firmware change or anything else other than not having enough cells for the traffic in the area. The "correct" solution is to split the cells up more finely - by installing a bunch of new short range cells to replace a few long-range ones or possibly to split the pie-slices more finely or do steerable antennas.
But both approaches require capital investment in a "lending freeze" economy - where cellphone upgrades are the first thing the consumers cut. The first one also requires regulatory approval for more antenna sites in eco-wacko land where "no nasty carcinogenic electromagnetic fields in MY back yard" is the paradigm of people who don't get the inverse-square law and are perfectly willing to put the antenna of the portable end of the system right up against their skulls.
Bantam Dominique roosters crow a four-note song. Once you've heard it as "Happy BIRTHday" you can't NOT hear it that way
The carterfone and that whole line of reasoning has nothing to do with the iphone on competitor networks.
Carterphone is directly applicable.
The carterphone decision is specifically about letting people buy phone equipment of their own choice and requiring the phone companies to let them attach it to the network, rather than renting the limited choice of company-provided equipment.
It led to the "foreign attachments tariffs" and in two steps to the type-approval process, where any equipment that would meet the standards for interoperability could be certified by a lab hired by the manufacturer, then bought and connected by a customer.
(It also led to long-distance service competition, antitrust litigation, and the breakup of the AT&T monopoly: MCI was formed, strung microwave links between cities, hooked 'em up to local phone lines, and let people bypass the AT&T long-distance service by dialing a local number then a customer ID and a long-distance number. AT&T sued, MCI counter-sued on antitrust and won, Southern Pacific Railroad strung fiber beside the tracks for their train signals and formed Sprint to sell the extra bandwidth on their network, ...)
Carterphone was about breaking an anticompetitive tie-in between a network provider and its captive equipment supplier - with wireline rather than wireless equipment. Yes, in this case the bite is on the other carriers more than on the customers of the offending carrier (though the tiny General Telephone company, with its smal islands of local-phone customers, couldn't get Western Electric phones back then - a similar situation). So though the precedent won't transfer directly, IMHO the comparison is still apt.
Bantam Dominique roosters crow a four-note song. Once you've heard it as "Happy BIRTHday" you can't NOT hear it that way
your Government gets a socialized medicine scheme and nobody else does?