Wireless
FCC Chairman Julius Genachowski has asked fellow commissioners to vote approval for a broad inquiry into wireless industry practices at the agencys Aug. 27 meeting.
The agenda for the meeting lists proposed inquiries into the “status of competition,” how to “encourage innovation and investment” and ways to “empower American consumers” with information about services.
The agency probably will look for evidence that AT&T and Verizon, which have a combined 60 percent of the U.S. market, engage in anti-competitive behavior, said Andrew Jay Schwartzman, a Washington communications attorney who has followed the FCC for more than 30 years. The probe may signal President Barack Obamas intention to step up scrutiny of antitrust matters generally, he said.
“The willingness to investigate these questions foretells an administration willing to take on large operators,” said Schwartzman, who is president of Media Access Project, a nonprofit law firm.
Among practices the FCC may question are terms for connecting rival companies calls, fees for access to lines that move high-volume traffic, the length of contracts tying subscribers to carriers, and fees charged customers when they want to leave a contract early, according to an FCC official who declined to be identified discussing the plans.
Apple, Palm
“The commission is taking a proactive approach to better understand practices in the wireless market,” Jen Howard, a spokeswoman, said in an e-mailed statement.
Genachowski, a Democrat appointed by Obama, took office June 29. The chairman wasnt available to comment, Howard said.
The agency said June 18 it was investigating whether consumers are shortchanged by carriers exclusive contracts for wireless handsets, such as deals linking Apple Inc.s iPhone to AT&T, Palm Inc.s Pre to Sprint Nextel Corp. and Research In Motion Ltd.s BlackBerry Storm to Verizon.
Separately, the FCC is reviewing a complaint by EBay Inc.s Skype unit that wireless carriers block consumers from using Skypes Internet-based calling services.
The FCC also has sent letters to Apple, AT&T and Google Inc. asking about Apples rejection of Google Voice for the App Store, a Web site where consumers can download applications for the iPhone. Google Voice offers lower-cost calling and text service. Responses to the letters are due today.
“We are being reviewed, and I think its fair to say we have some work to do to educate policy makers,” said Christopher Guttman-McCabe, vice president for regulatory affairs for CTIA-The Wireless Association.
Steve Largent, chief executive officer of the Washington- based trade group, said he expected the FCC to hold hearings.
“Theres not even any hesitation in welcoming the FCC or anybody else to investigate exactly how competitive this industry is,” Largent said.
The FCCs regulatory reach in the wireless industry includes approval of mergers and administering rules that aim to bolster competition, such as letting customers keep phone numbers when they switch carriers.
Basking Ridge, New Jersey-based Verizon Wireless is “very much looking forward to beginning the dialogue” about its services, spokesman Jeffrey Nelson said.
“We like the fact that this new FCC and the new chairman seem to be very data-driven,” said Michael Balmoris, a Washington-based spokesman for AT&T, in an e-mailed statement. “When you look at the facts in the wireless industry, you see a lot of choice and variety.”
Two Gorillas