Apple iPhone / AT&T collusion under fire in Congress - future of network locked/bundled phones in question
By Will Park on Wednesday, July 11th, 2007 at 11:41 AM PST In AT&T, Apple, Events, iPhone
Yea, the iPhone is locked to AT&T (NYSE: T). No, it doesn’t seem fair. But, what’s a nation to do? Well, the Congressional Subcommittee on Telecommunications and the Internet is holding a hearing today to discuss whether it is “fair” to bundle cell phones with certain wireless carriers. The debate is officially titled, “Wireless Innovation and Consumer Protection,” but is being referred to as the “iPhone hearings.”
Committee Chairman, Ed Markey, told The Street that, “We need to unbundle phones,”adding that, “The consumer should be king and should be able to take their device with them, to whichever network provider is offering them a better deal…”
The result of today’s debate will determine the future of the mobile industry - not only in how mobile phones are bundled (or, “locked”) to a particular wireless network, but also in how the upcoming 700Mhz wireless frequency spectrum will be deployed. Former FCC Chairman, Reed Hundt, called for the creation of an open, high-speed data network from the auctioned airwaves. Current FCC Chairman agrees with the sentiment that the winner of the newly opened spectrum provide an open-platform for “innovative services for consumers.”
Could Congress go so far as to force AT&T and Apple (NSDQ: AAPL) to release their strangle-hold on the iPhone and actually order the colluding duo to open the iPhone to other networks? Possible, if not probable.
Still, it would be nice.
[Via: Tech.Blorge]
Come on! Doesn’t anyone understand why the iPhone is locked to AT&T? Hasn’t anyone spent time understanding the functions of the phone and what they require from the network? This is getting stupid. And now we have the ignorant publicity hounds in congress rallying for consumers so that we’ll get lowest common denominator garbage from all carriers. Stupid.
If you’ve looked at the phone and spent some time with its functions and integration, you would know that a carrier will need to invest in infrastructure so the phone can work with their network. If the iPhone was unbundled and used on networks that haven’t been upgraded, functions like visual voicemail just won’t work.
Sour grapes from those that want to dictate how business works, but unfortunately they have the power to hamstring innovation–and they haven’t learned that they do this all the time. Please stop!
Give me innovation over “consumer protection rackets” any day.
I agree with you that Apple needed to make certain demands from the carrier to pull of the iPhone’s feature set. But, that doesn’t take away from the fact that carriers, as a whole, need to be more open to innovation. The iPhone should have been available on every network, and carriers should have been open to the network requirements of the iPhone. The AT&T lock is more the result of simple economics than anything else - Apple and Steve Jobs are greedy (but that’s fine, this is America).
I’m rooting for some sort of ruling that bars the kind of exclusivity that we see with the iPhone - but with the caveat that carriers get off their high, ancient horse and get with the modern times.
I have to disagree with Stephen. Since Apple signed or rather forced their rules onto AT&T (Thanks GOD I’m with T-Mob) it gives other carriers no reason to implement such features as visual voice mail etc on their network. If device locking would be prohibited, then the end user (You and I) would have option of getting the device of our choice with advanced features WHICH in turn would make the operators re-think their strategy and start implementing more features. My good friend from Germany told me that when you buy a phone from any operator in Germany it’s unlocked by default (I don’t know if he misunderstood my comment about locked phones but assured me that sim locking devices is not allowed there…can someone confirm)
If the carriers are so afraid to loose their customers they can implement some kind of device recovery fee (similar to early termination fee) where even if the device is unlocked - AND you decide to leave them - they could charge you the current fair market value of the device. As an example I had an issue with my Nokia N80 where the device was sent in for repair. It took Nokia 5 weeks. In the end I was offered two options… wait longer (with unspecified return time OR get a refund). I picked a refund - I paid a full price for N80 In June of 2006. 10 Months later I could get the same device brand new and unlocked on the web for about $350. Nokia offered me $362 (prorated). I happily accepted. KUDOS to Nokia for a GOOD problem resolution. The same could apply to carriers. You get the device free of charge. In one year if you decided to leave they would charge you the fair market value of the USED device.