July 16, 2007 4:00 AM PDT
Unlock the cell phone? It's a high-stakes debate
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It's still unclear whether Congress intends to doing anything to force operators to allow any device to connect to their networks or to permit people to add third-party software to their handsets. While Congress was responsible for forcing wireless operators in 2003 to allow people to take their phone numbers with them when they switched providers, no legislation has been proposed that would ask operators to do the same for handsets.
Still, many advocacy groups are pushing Congress to apply rules established as part of the 1968 Carterfone decision, which allowed non-AT&T telephones to be connected to the regular phone network. Skype has already petitioned the FCC to loosen its rules on what devices and applications can be used on a carrier network citing the Carterfone decision.
Right now, the best bet for moving the issue forward is getting the FCC to include special provisions in rules for the upcoming spectrum auction that could require some form of "open access."
The chairman of the FCC, Kevin Martin, is already advocating for open access when it comes to devices. Earlier this week, he circulated a proposal of rules for the auction that would require winners of some 700MHz spectrum licenses to let any device connect to their networks so long as they are safe and do no harm to the network.
Consumer advocates and technology groups, such as the Wireless Founders Coalition for Innovation, applauded Martin for moving in this direction. But they say his proposal, which few people have actually seen so far, falls short of guaranteeing true open access. For one, critics say Martin has said little about requiring winners of these special spectrum licenses to offer open networks for wholesale use.
"What Chairman Martin proposes is a protection for consumers, and we think that's great," said Art Brodsky, communications director for the advocacy group Public Knowledge. "But the bigger issue is ensuring that we create an environment where there is more competition through an open-access network, which could eventually pressure cell phone operators to open up the rest of their networks."
Offering an open, wholesale network allows companies that may not be able to afford to build their own network or may not want to invest the capital on a new network the opportunity to sell service or develop new wireless applications.
On Monday, Google's telecom lawyer, Richard Whitt, said in a blog post that Google hasn't ruled out bidding on spectrum. But sources close to the company say Google's primary interest in the 700MHz auction rules isn't necessarily laying the groundwork for its own bid, but encouraging other companies to bid on the licenses, so that after the network is built Google can eventually rent capacity on a wholesale basis.
Why? The reason is simple. Google is not a communications service provider. It's an Internet company. Under its current business model, Google doesn't need to own the underlying pipes it uses to deliver search, Internet voice, e-mail or mapping services to broadband consumers, just like HBO doesn't need to own the cable infrastructure to offer viewers Entourage. Theoretically, Google shouldn't have to own the wireless infrastructure to deliver any of these services to mobile users either.
In a letter sent to the FCC last week, Google said the FCC should consider including four "open access" provisions in its rules, including one that would require licensees of the spectrum to also offer access to their networks on a wholesale basis at "reasonably nondiscriminatory commercial terms."
Without the wholesaling provision, consumer advocates and technology entrepreneurs say simply requiring operators to allow devices onto this new sliver of spectrum won't have much impact. For one, if an existing wireless carrier wins these spectrum licenses, the company would only be required to allow open access for that sliver of spectrum. The rest of the service, which uses other spectrum, wouldn't have to adhere to the requirement.
Instead, critics say the only way to force change in the market is to make sure that any company can access an open nationwide broadband network to deliver competitive services.
"If we establish an open network that allows new competitors to play around with offering unrestricted handsets, then the market will decide whether or not that is something consumers really want," Txtbl's Sarva said. "If we create this playground of innovation, we won't have to legislate new regulations, because the phone companies will be forced to change due to competition."
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