FCC Looks To Offer Consumers More Wireless Choice

An anonymous reader writes "The FCC is butting heads with wireless phone companies over 'wiggle room' the government organization wishes to allow consumers. Along with the move to the auction system, the government is removing restrictions on pieces of the wireless spectrum, which will allow a freedom of choice not usually seen with wireless communication devices. 'In the past, when the F.C.C. auctioned spectrum for cellular service, it allowed the winners to determine the equipment and applications that would run on their networks. That created the current status quo, in which a vast majority of American consumers buy a handset from a wireless service provider. The open-access rules, which will apply to about one-third of the spectrum being sold at the auction, represent a significant departure from past practice. They require the winners to let consumers use any tested, safe and compatible device or application on its network. Entrepreneurs could sell handsets with capabilities that are unavailable -- or unavailable at affordable prices -- from current carriers.'"

Good News

[peterjb31]

Sounds like good news to me, it will increase competition.

Re:Good News

[ciscoguy01]

This will absolutely increase competition.
The current status quo where the carriers keep a stranglehold on the equipment supply and use it as a method of keeping their customers signed to two year contracts is outrageous.
We should be able to buy our equipment from any reseller and use it on any compatible network. Then there would be competition and the prices of phones would decline and the features we really want would be made available.

Re:

[Buelldozer]

You already can buy equipment from any reseller and use it on any compatible network. You just have to pay for it without the Cell company subsidizing part of the cost. In other words you won't be paying $49.99 for that cell phone, you'll be paying it's REAL cost of $349.99.

Where are the cheap BYOP service plans?

[tepples]

You already can buy equipment from any reseller and use it on any compatible network. You just have to pay for it without the Cell company subsidizing part of the cost. In other words you won't be paying $49.99 for that cell phone, you'll be paying it's REAL cost of $349.99.

So why don't retail stores across the United States sell phones separately from service plans? And why don't the four major carriers advertise bring-your-own-phone plans with a lower monthly fee than the subsidized-phone plans?

Re:Where are the cheap BYOP service plans?

[Andy Dodd]

Because the market for such phones is not sufficiently large for their to be a significant B&M presence.

That's why you only see unlocked phones from specialty online retailers such as Mobileplanet and some manufacturers, such as Motorola.

Note: This only applies (essentially) to AT&T and T-Mobile, the two major GSM carriers in the U.S. Unfortunately, while the modulation scheme and protocol suite of cdmaOne/CDMA2000 are superior to GSM, GSM has one major advantage - The use of a standardized SIM (Subscriber Identification Module) is mandatory for GSM handsets, meaning all you need is a SIM from the carrier and a phone either from the carrier or a vendor of non-carrier-locked handsets (such as Mobileplanet).

AT&T and T-Mobile allow bring-your-own-handset but don't advertise it because, in reality, there is unfortunately no market for it, and they would prefer for users to use the carrier's handsets, for two reasons:

Sometimes features of carrier-branded handsets are crippled to make the user have to pay for extra features (See Verizon and Bluetooth DUN on the Treo 650).

Sometimes carrier-branded handsets have extra marketing/"features" designed to get you to pay for services from the carrier. (Such as the built-in "XM Radio" app on AT&T versions of HTC devices.)

Those two reasons are why you never see "BYOD" discounts, similarly you don't see service discounts for non-contract-subsidized phones from the carriers. Your "discount" is the fact that you are not locked into a contract.

Re:

[ciscoguy01]

There are *no* plans like that.
I tried to get a number with Cingular, now AT&T- without a contract. There was no way.
I had my own phone, I just needed a SIM and I didn't want a 2 year deal, which since they are not subsidizing my phone I should have been able to get.
NOPE. There was no way. It was not available. I went to the local store, I called their tollfree number. Went to a reseller. NOPE.

Neither Sprint nor Verizon will activate a foreign phone, and with CDMA it's not a matter of sticking

Re:

[Andy Dodd]

"The phone carriers have all their phones marked up greatly so they can give you a giant fake discount when you sign your two year deal. That all needs to go away."

Then why is it that phones that do not originate from the carriers are so much more expensive? The carriers are not marking up prices on the hardware at all to provide a "perceived" discount. They are providing significant discounts for subsidized phones, and are basically selling carrier-locked but non-subsidized phones at cost.

The non-contrac

Re:

[Lifyre]

Almost every store DOES sell them without a contract. You'll note the little price next to the big price that is a few hundred dollars higher. They don't like to because thats not their job. It may not be obvious but the option IS there. As for cheaper plans why would they? If you bring your own phone it's more money in their pocket...

Re:

[ciscoguy01]

Well, that is subterfuge.
They sell those non contract phones, sure. Ya know who buys them? People who have lost their phone and have 18 months left on their contract, without a phone they have to pay and get nothing. They are always carrier locked too.
It's hardly a competitive market for multi network non-contract phones. It's all fake.
A number of years ago they had to set a price without a contract to set the price of the phone for sales tax purposes. What the phone companies were doing was giving

Duopoly > monopoly, right?

[tepples]

Almost every store DOES sell them without a contract. You'll note the little price next to the big price that is a few hundred dollars higher.

I'm willing to spend $300 more on a handset if it's not subsidy-locked, it's not crippled, and I get $12.50 per month knocked off the first 24 months of my bill. What should be done to make such a business model viable in the States?

As for cheaper plans why would they? If you bring your own phone it's more money in their pocket...

Because it's money in AT&T's pocket that doesn't go into T-Mobile's pocket, or vice versa. In theory, a duopoly should have some of the benefits of a competitive market that a monopoly lacks.

Re:Duopoly monopoly, right?

[Lifyre]

Yes two is greater than one but then again we have two political parties, soviet russia only had one. Last I checked neither of them gave two shits about the people... Semper Fi

Re:

[goodie3shoes]

Relative freedom is possible now, if you're willing to make some sacrifices. Buy an unlocked GSM phone. Tmobile has (or at least had) in the US a SIM-only program. I showed up with my phone, they gave me the SIM. I've moved it to another phone, they neither know nor care, though I don't get the "benefit" of their pushed software updates. And when/if I travel to Europe, Asia, South America, I buy a local SIM, get a local number, and am not skarood by unreasonable international roaming charges.

Re:

[schmiddy]

I'm glad to see the FCC taking this small first step, but I don't have a lot of hope for how much this would help. When you think about it, all the sleazy monopolistic telecom companies are basically offering the exact same service: transferring bits from one end of a network to another. Of course, instead of treating this service like what it is (i.e. a commodity) and charging appropriately, the telecoms love pretending that they're offering something unique and, of course, charging excessively for it. Wi

It's a start.

[Mikachu]

Well, at least it's a start. God knows we need some regulation to stop the wireless cartels from gouging the prices beyond belief. I don't know what the hell they were thinking when they sold our souls to the devil thus far.

Still, why only one third? With something so limited as a spectrum, why the hell would you license our future to corporations?

Don't answer that, unfortunately, I know all too well. Greed is a very strong part of our government.

Re:It's a start.

[MBCook]

The optimist part of me says they are doing this to give it a trial without going full out incase it causes unforeseen problems. In other words, it's a safer trial run. Can't move too fast, right?

The pessimist part of me says they are doing this because it should jack the price of the two closed parts of the spectrum way above what it would be otherwise. Combine that with the heat over this open part (with big pockets like Google going against incumbent telcos) should be tons of "free" money that they don't have to get from the taxpayers (directly, since we all know what will happen to our bills).

I believe the pessimist part of me is winning about 85% to 15%.

Re:

[aichpvee]

With a government as shitty as ours has become over the last 6 years there is a whole lot for which to blame this government. Maybe if "little faggot naysayers" like you spent a little more time thinking and less whining about other people who do think we wouldn't have so many of these problems.

Re:

[evilviper]

why the hell would you license our future to corporations?

What's you're alternative? US Government cell-phone service? Free-for-all access, and hope your signal is powerful enough to get through the noise?

Your complaining isn't "Insightful" by any stretch of the imagination.

Re:

[SoopahMan]

Who would you license it to instead? How would they keep their antennas running?

Running a network costs money and if we want to do anything with them they've got to make some money. What's evil is sacrificing everything to expand profits. Making a reasonable profit for expanding consumer's options (no cell providers, no cellphone) is essential to the continued expansion of services - and earning an honest wage. Abusing control to make every last dime off the consumer is the problem.

The devil is in the details.

[Andy Dodd]

One: The network owner can bastardize the definition of "tested, safe, and compatible" in any way they please. For example, "tested, safe, and compatible" is the excuse Verizon has for delaying the release of phones for 6-9 months past the same unit's release on other networks. (In reality, it's because they're crippling various features of the phone to make more money - see the manner in which they delayed the Treo 650 for at least six months and disabled Bluetooth DUN capability in the process.) This happens to be one of a number of reasons why I am no longer a Verizon customer.

Two: You can already use any FCC-certified GSM device on any of the GSM networks in the U.S. Just pop in your SIM and go. (Assuming that your handset itself is not locked to a different carrier.) For example, you can buy an unlocked HTC TyTn II directly from the manufacturer, pop in a T-Mobile or AT&T SIM, and be up and running immediately. Want a droolworthy device like the HTC Advantage series? Just pop in your SIM and go.

In the end, unless there's something "unusual" in the details, this doesn't appear to be much different (if at all) from the status quo.

Re:

[Andy Dodd]

One additional thing - "Entrepreneurs could sell handsets with capabilities that are unavailable -- or unavailable at affordable prices -- from current carriers."

Not going to happen. Well, they could pull off "capabilities that are unavailable", but they won't be able to pull off "unavailable at affordable prices from current carriers". It's a known fact that non-subsidized unlocked phones are going to be expensive. The manufacturer and all the vendors in between want to make some profit on the device, w

Re:

[dada21]

I own an HTC Trinity P3600. Unlocked of course. I paid full price for it. No big deal, I use it for hours a day so it's saving me more in 2 months than it cost.

If you want a TyTn II, you pay $799 for it. You get the AT&T Tilt for $299. Take that sim card, put it in the TyTn II. Sell the AT&T Tilt for $500 on eBay. Net cost for a TyTn II: $799+$299-$450 = $648. Only $100 more than AT&T locked phone.

Re:

[Andy Dodd]

I don't see why I would ever want to do such a thing, the only thing the TT2 has over the Tilt is the (rather gimmicky) front camera.

Unlocked? - Not much point if you're in a 2-year contract with AT&T (Required to get the $299 Tilt). Anyway, they'll give you an unlock code with not much hassle if you're a customer in good standing (i.e. all bills paid) for 90 days.
HTC ROM instead of AT&T ROM? - HardSPL was released over two weeks ago. My Tilt is running the HTC ROM. :)

CDMA violation?

[tepples]

Two: You can already use any FCC-certified GSM device on any of the GSM networks in the U.S.

Not if the only networks that can get a reliable signal to where you live or work are CDMA.

Re:

[Andy Dodd]

Yeah, unfortunately this may still be the case in some areas, although as a former Verizon customer that has switched to AT&T within the past two months, at this point I'm fairly confident in saying that Verizon has lost most of the (previously massive) coverage lead they had five years ago.

When I was in college, Verizon was the only choice if you wanted coverage in the Finger Lakes region of New York State, and upstate NY in general.

Now that I have AT&T, I have not encountered a single situation wh

Re:

[johnkzin]

Maybe that's why the quote specified GSM :-)

(verizon and sprint aren't GSM carriers, they're CDMA carriers)

This sounds horribly dumb, explain this again?

[plasmacutter]

Ok, so their idea is "help consumers" by regulating it so everyone who owns a piece of spectrum has to make acquaintance for every device and service?

so if they want IPTV over that spectrum the cell phone company must provide IPTV?

this seems a little counterproductive to me.

In fact it sounds to me like the FCC has reached a new level of regulatory bastardization.. anything which makes things as hard as possible for one, if not both sides of the table is best amirite?

note, I'm all for pro-consumer regulation

Re:

[Urza9814]

Yea...that's not at all what they're saying. I believe they're just saying that, for example, verizon can't force you to use a verizon brand bluetooth headset with their phones.

Re:

[fireboy1919]

Ok, so their idea is "help consumers" by regulating it so everyone who owns a piece of spectrum has to make acquaintance for every device and service

See the OSI model. Idea is that the people who buy it only get to control the network layer and below. Not the application layer...or, more specifically, they will only have *full* control of the network layer and below.

so if they want IPTV over that spectrum the cell phone company must provide IPTV?

this seems a little counterproductive to me.

The provider jus

Re:

[Planesdragon]

AAAAAAAAHHHHHHHHHHHH!!!!!!!!!!!!!!

1: It's the FCC that smacks you around, not the telcos. Every single electronic device that communicates in a licensed spectrum -- that is, every useful spectrum beyond about 50 feet -- has to go through a battery of FCC tests. If you hack your device so it doesn't perform as intended, the FCC is the one who knocks down your door and throws the book at you.

2: The DMCA is a copyright law. It has nothing at all whatsoever to do with patents.

3: The DMCA itself is no worse t

"Requirements" don't mean shit anymore...

[kcbrown]

They require the winners to let consumers use any tested, safe and compatible device or application on its network. Entrepreneurs could sell handsets with capabilities that are unavailable -- or unavailable at affordable prices -- from current carriers.

Uh-huh. Sure. And if the winners don't do any such thing, then what?

If the big telcos are the winners then I can pretty much guarantee that the FCC isn't going to do a thing to enforce this. The telcos (like the other huge corporations) own the government, and the government knows who its masters are.

So in the end, "requirements" such as this one are just free publicity and a way to calm the masses down. They mean nothing.

Just look at how well the internet "last-mile" buildout is working out here in the U.S. if you don't believe me.

Re:

[PopeRatzo]

and the government knows who its masters are.

Those corporate masters have now become the government.

It's getting more difficult to see a bright line between where corporations end and where government begins.

For example, right now, there's exactly ONE US Senator (Chris Dodd) who is trying to prevent AT&T and other Telcos from getting retroactive immunity from any illegal action that may arise from their performing illegal wiretaps for the Bush Administration. And, surprise, the most enthusiastic supp

Re:

[ChiRaven]

As one who spent most of a 30 year career in or near telco regulatory, I would respectfully suggest that you don't know what you're talking about. Even in the days of the Bell System (a giant compared to the babies of today) the companies took regulatory restrictions seriously. And since then it's been the same.

In the late '90's and beyond, for example, they worked like mad to comply with the equal access provisions of TA96, in order to avoid the potential tens of millions of dollars in monthly fines a

Re:

[ezeri]

As someone who has spent the last 12 years watching the Telcos do everything they can to not comply with the intent of telco regulation I would say your full of it. You've sold your soul for money, you know full well that the telco's, including yours, will do everything in there power to make it very difficult for competitors to get a foothold anywhere.

Re:

[ChiRaven]

And as somebody who spent 1998 and 1999 personally helping Ameritech prove that they were complying with the "equal access" provisions of TA96, and saw the tremendous amount of time and effort that went into that enterprise throughout all areas of the company, I'd say you are at least as full of it if not more so.

We worked our butts off to comply with those regulations, and were subject to penalties that could literally run to tens of millions of dollars a month if we did NOT comply. There was no questi

Re:

[ezeri]

I never said you didn't do everything to comply with the letter of the law. What I'm saying is that you did everything you could to make life hell for any CLEC. And yes getting corrupt regulators to do your bidding was often a big part of it. But usually feigned incompetence was the preferred method (though actual incompetence is quite common as well).

Re:

[kcbrown]

And I am not aware of any government mandate regarding last mile buildout. By policy the FCC encourages better access for everyone, but can you cite any Order that requires specific actions? I don't even recall a NPRM along those lines.

http://www.pbs.org/cringely/pulpit/2007/pulpit_20070810_002683.html [pbs.org].

'Nuff said.

The real question is: when did you stop working in the telco regulatory environment? I'd say things have changed significantly with respect to the telcos in the last 5 to 10 years. It

Re:

[ChiRaven]

I, too, lived through that era in telecommunications, and as far as I know there was NEVER any expectation on anyone's part (at least in the industry) that TA96 would involve ubiquitous DS-1 or DS-3 speeds in the last mile. The High Speed services envisioned for that ALWAYS involved competitive offerings between the cable TV companies and the telcos (DSL, whether symmetric or not ... SDSL had its champions among many of us in the business, but we lacked a sustainable business model to support it against th

Can I get some cake with that?

[davmoo]

The problem is going to be that Joe Consumer wants to have his cake and eat it too...he wants his device unlocked, and also wants it subsidized by the carrier. Sure, there might be unlocked devices available that aren't tied to a specific carrier. But they will come at a premium price, something that the average American who expects a $5 top of the line cellphone will not pay.

I want to put cake in a take-home bag

[tepples]

The problem is going to be that Joe Consumer wants to have his cake and eat it too...he wants his device unlocked, and also wants it subsidized by the carrier.

I want to have a cake and eat it later. I want a handset that isn't crippled; for example, if the manufacturer says it can run midlets, it should run midlets that I have developed using the Java Micro Edition SDK. I want it on a 1-year subsidy lock, after which point the handset becomes fully unlocked, the price of the plan drops, and I can jump ship to the other network if I want.

Re:

[remmelt]

Ah, the exact same system we've had in the Netherlands for years now. Recently, the carriers have been offering SIM-only deals as well, something that was only offered by third parties so far. These deals are VERY cheap.

Usually you buy a phone with a plan at a store. This store sells plans for all the carriers, and all phones work with all carriers (yay for GSM!) When they sell you a plan they get subsidised by the carrier so they can offer you the phone for free/cheap.
The idea was that when you buy a plan

Re:

[jamar0303]

Well, this seems to work just fine for China. I can be on a 2-year plan and my phone is unlocked and subsidized (on a sliding scale, too- the $10/month plan gives you a smaller subsidy than the $30/month plan). Or, for prepaid, I do the "1.8 plan" where I top up my account with 1.8x the phone's price and get the phone for free and unlocked (because after you've put $500 into a prepaid account you're not really going to let it go to waste by jumping ship, right?).

Re:

[bob.appleyard]

I have to say, quoting Serbian epic poetry is a new one on me.

Google Did It

[SoopahMan]

This is old news. The 2 open access requirements are a result of Google demanding the auction enforce 4 open access rules on any winner. The FCC made a political move by meeting Google half-way.

That said, it's good to finally see an article about this that doesn't invoke crazy conspiracy theories and applauds the FCC for taking (some) steps to protect consumers.

Yeah right

[langelgjm]

Entrepreneurs could sell handsets with capabilities that are unavailable -- or unavailable at affordable prices -- from current carriers.

How about, entrepreneurs could sell handsets with capabilities that are submarine patented by current carriers, and be sued out of existence, à la Vonage.

what BS!

[Anonymous Coward]

In the past, when the F.C.C. auctioned spectrum for cellular service, it allowed the winners to determine the equipment and applications that would run on their networks.

Not true. If you have an account with T-Mobile or AT&T/Cingular, they do NOT restrict the handsets you can use. Any unlocked GSM handset that works with 850/1900 MHz will work. You can buy these all over the world.

I've heard of people doing that with Verizon's CDMA service, but never seen it myself.

That created the current status quo,

Re:

[tepples]

If you have an account with T-Mobile or AT&T/Cingular, they do NOT restrict the handsets you can use. Any unlocked GSM handset that works with 850/1900 MHz will work. You can buy these all over the world.

Does "all over the world" include Fort Wayne, Indiana, USA? Can I walk into a retail chain and buy an unlocked GSM phone? Or do I have to try my luck with someone I've never seen before on eBay?

Re:

[Andy Dodd]

They tend to be hard to find in B&M stores in the U.S. because there is little to no market for such phones. Average Joe Wireless User wants his $800 phone for $300 and doesn't care that it locks him into a 2-year-contract. Heck, even non-average-joes like myself don't care much about getting locked into a 2-year contract, and are definately fine with it when it saves $500.

You can buy them from reputable online specialists such as Mobileplanet, and in some cases, directly from the manufacturer.

For exa

Still pretty weak

[tknn]

They should have just given consumers open access to the spectrum so that we could have something better than Wifi.... And why won't they just harmonize our frequencies with European carriers, or at least just pick some national broadcast standards.

Re:

[jamar0303]

First off, Japanese CDMA has its Rx/Tx switched in the 800MHz band, and their EVDO runs on 2100MHz. Second, they use non-standard ESNs (5 letters A-Z followed by 6 numbers).

DoCoMo phones (the roaming-capable ones) are 2100/850 3G, so coverage would be extremely limited in the US, and they are locked down *hard*. Some Softbank phones have been unlocked, but the ones that haven't are the ones that require "phoning home" to Softbank every so often or the phone locks up. Mostly it's the older Vodafone Japan

FCC Commissioner Michael J. Copps

[not_hylas( )]

I'm not so "up" on this particular subject, but I did see this fellow speak to some committee a while back [CSPAN] on The Spectrum Sale, or something related.
In this administation of incompetence, this guy is a real relief to hear speak - about what is the people's, he is the real deal.

Bill Moyers talks with FCC Commissioner Michael J. Copps:

http://www.pbs.org/moyers/journal/08242007/watch.html [pbs.org]

MICHAEL J COPPS: Now we're back at square one. It's all up for grabs. And if we are going to do better this time around, it's going to be because of input from folks like you.

MICHAEL COPPS: Well, we're going at it without a policy. We're going at it without a vision. We're going at it without realizing what these things mean to the future of our country. Whether it's broadcast or broadband.The public airwaves are to be used for serving the public interest. Expanding our cultural horizon, covering community news, enabling the democratic dialogue. Increasingly, we have moved away from that vision and they're being used for corporate profitability.

MICHAEL COPPS: Yeah. It appears 112 times in the Telecommunications Act. The term public interest convenience and necessity. So I know darn well Congress was serious about it.

BILL MOYERS: You're talking about the 1934 Act.

MICHAEL COPPS: Right.

You know it's BAD when you get excited about someone speaking "common sense" on CSPAN. The link is worth the time to view.

Where DO they hide these quality people - and who do we have to blow to get them in government?
[don't answer that]

Re:

[vtcodger]

***In this administation of incompetence, this guy is a real relief to hear speak - about what is the people's, he is the real deal.***

Yes, Copps appears to be pure of heart and soul. But he is one of the two Democratic (minority) members of the FCC. He is in no way, shape, or form representative of the Bush administration. In fact, he has devoted most of his time on the FCC trying, as best he could, to balk the plans of ex Chairman Michael Powell to give away everything not nailed down and many thing

About time ...

[ScrewMaster]

and why not? The days of telecom provider lock-in on subscriber equipment were supposed to have been over when old AT&T was broken up. Comcast doesn't require that I purchase my computer and operating system from them (and if they tried, their customers would scream bloody murder.) I do rent my VoIP gateway from AT&T, true ... but I can use any compatible POTS equipment with it that I want. I fail to see why the cellular companies have reacquired the privilege of screwing their customers this way (other than the same reason that dogs lick their balls.)

Re:

[True Vox]

Maybe they don't, but they do require you to have windows to get your broadband set up (or else jump through hoops :D).

Too Bad It's Only A Third

[Jane Q. Public]

Long ago, this used to be the norm. Ma Bell (and AT&T, etc) were not allowed by law to restrict what equipment could be used on "public" telephone lines. They managed to do so anyway, by insisting that if you did not use a phone made by Western Electric (a wholly-owned subsidiary), you had to pay extra fees, have an installer hook it up, and pay for an "adapter" device that supposedly made sure the equipment was compatible with the phone line.

Many people are not aware, but it was this "monopoly lever