Antitrust Pressure Mounts For Wireless Providers 300
Over the past few weeks, the cellphone industry has been criticized on a variety of subjects, from distracted driving to handset exclusivity deals to everything else that's shady within the industry. Verizon's CEO has now responded, addressing what he claims are "myths" about standard practices. Reader DJRumpy points out that the chairman of the Senate Subcommittee on Antitrust, Competition Policy and Consumer Rights has been calling for an investigation into whether competition is being stifled through many of these practices, "including possible text messaging price fixing and questionable roaming arrangements." Apparently the new antitrust chief is hitting resistance from within the government over the aggressive inquiries into this and other major industries. However, a small victory was achieved the other day when the National Telecommunications and Information Administration "told incumbent carriers that they'll have to prove their cases just like everyone else if they want to challenge broadband grant proposals from smaller players." There is also legislation in the works that would require states to impose a ban on text messaging while driving or lose a significant portion of their federal highway funding.
Re:Yeah, take THAT Verizon! (Score:1, Informative)
Re:All I want to see... (Score:4, Informative)
Did you have a snowball's chance in hell of negotiating? Did competitors give them any incentive to be reasonable?
No and no.
Re:Contracts aren't what they used to be... (Score:1, Informative)
Not if monopoly power robs the consumer of bargaining power.
What monopoly? There's four carriers. At least one of them will let you sign up without any contract [t-mobile.com] what so ever.
Re:Contracts aren't what they used to be... (Score:5, Informative)
cartels and monopolies behave the same way and have the same economic side effects so my point still stands.
Re:Yeah, take THAT Verizon! (Score:5, Informative)
There are cities on the US/Canadian border that you can pick up Canadian towers, and they will indeed charge you for roaming.
Re:All I want to see... (Score:4, Informative)
This is nonsense. The contract fees are specifically designed to keep you from jumping ship. They don't want you moving to a competitor. They want to be able to abuse you as a consumer and they use the fee as a fear tactic. Jump ship and they still get a ton of money out of you.
It's anti-competitive, pure and simple.
Re:Contracts aren't what they used to be... (Score:2, Informative)
It's called an oligopoly when multiple companies all work together in a sort of monopoly on an industry. Another example is the oil industry.
You ought to visit Canada sometime. You think you've got it bad in the States with cell phone providers. It's a utopia compared to Canada.
Re:Yeah, take THAT Verizon! (Score:2, Informative)
There are cities on the US/Canadian border that you can pick up Canadian towers, and they will indeed charge you for roaming.
And if you live in one of those cities it would seem to me to be your responsibility to pay attention to the roaming indicator on your phone. If you don't want to do that then you can lock your phone in "home only" mode (CDMA) or manually specify the carrier's network (GSM) to keep it from roaming.
Re:All I want to see... (Score:3, Informative)
Many cell phone companies (Sprint included) price phones in such a way that the only way one can afford to get service with them is to sign their 2-year contract, which subsidizes the phone. Then, if you are unhappy with the service, you're stuck doling out a large sum of money just to switch to another carrier that might be even worse.
I understand that the company must recoup the money they spent on subsidizing the phone to you, but having to pay the full termination fee whenever you've already fulfilled part (or most) of the contract is absurd.
Re:Contracts aren't what they used to be... (Score:3, Informative)
AT&T's early termination fee is prorated [att.com].
Re:All I want to see... (Score:1, Informative)
Cell phones are NON-essential?
Yes, believe it or not, they are. Most people can get through life just fine without being reachable 24/7. If you must have one then don't come whining to me about the contract that you willingly signed. Particularly when there are other options (prepaid, T-Mobile Flexpay) available to you.
Re:Banning texting at the federal level (Score:4, Informative)
On the one hand, texting while driving is about as dangerous as drinking and driving. It takes eyes and concentration off the road and puts everyone else at risk. It is an activity that ought to be illegal.
Actually, it's worse. Car and Driver did a test comparing the two [caranddriver.com], and they found that text messaging while driving is worse than driving while intoxicated.
The reason? My guess is that when you're driving buzzed, at least you're (hopefully) giving the road your undivided attention.
Re:Laws against text messaging while driving (Score:3, Informative)
Where do you live that it's 'rarely criticized'?
This even just came out recently: Doctor who was on presidential commission that pushed to raise drinking age to 21 regrets change, believes it did more harm than good. [latimes.com]
Re:Contracts aren't what they used to be... (Score:2, Informative)
Some of them have something a little special like rollover minutes or the ability to call a certain number of people outside their network(under very special circumstances), but it's more about who you know in each network and not what they offer or what they cost. I have Verizon because all of my family and friends are on Verizon. This means I can call everyone I know for free. But the fact is that with normal competition, prices should have fallen by now and they have not. It doesn't cost them $5 to send 100 text messages but that's what they charge me.
It's like two gas stations across the street from one another. They could get into a price war till neither of them makes any money, or they could silently agreed to charge the same price and split the customers. Next time you see two gas stations across the street from one another, notice if their prices are the same. Unfortunately for most of us, we can't just drive down the street to find a wireless company that isn't silently price fixing.
Re:All I want to see... (Score:3, Informative)
No, that is technically not correct, although it does happen in the real world. The whole purpose of the ETF (which varies these days on provider, I know ATT is pro rating based on how long you have been on contract) is to recoup the cost of the subsidized device you bought from them, in exchange for a 2 year contract.
Like I said though, what something was meant for, and what it is actually being used for, are two totally different things.
Now I am not going to get into the fact that they abuse the ETF, for people like me who bring their own phones to the table and just purchase a contract, I still get screwed by the ETF....
What I would like to see is someone put the smack down on providers who lock their devices, and then refuse to provide the unlock once you have completed the 2 year term (or 1 year) of your contract. Once you are no longer under contract, you should be able to do whatever the hell you want, or if you pay the unsubsidized price. While Tmobile will do this, ATT will flat out refuse to for whatever reason you can think of, they will say no, so in the end if you want to change providers, you have to purchase a new device, thats absolute crap.
Re:Contracts aren't what they used to be... (Score:5, Informative)
I believe the GP is suggesting that Sprint, Verizon, AT&T and Cingular all act as a cartel in the US to artificially control prices, keep out competition and constrain consumer choice.
Is that clear enough?
Re:Text Messaging is Marked up 7314% (Score:1, Informative)
And that doesn't even consider the technical details of text messaging, which allow them to send text messages effectively for free by including them in data packets they have to send anyway.
Re:Yeah, take THAT Verizon! (Score:1, Informative)
This is not always accurate. The roaming indicator simply indicates that you are not on your carriers tower, you may be connected to a partner tower in which case you wouldn't be charged. However you could be roaming on a non-partner....
Re:Yeah, take THAT Verizon! (Score:3, Informative)
I'm well aware of that, but most end users don't know about that (unless they're told by someone who does.) Also, you usually get free roaming.. inside the country. 'Leaving' the country is an entirely different roaming situation they neglect to inform you about.