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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.
your Government gets a socialized medicine scheme and nobody else does?