Before the
FEDERAL COMMUNICATIONS COMMISSION
Washington, D.C. 20554

In the Matter of Skype Communications S.A.R.L.

Petition to Confirm a Consumer’s Right to Use
Internet Communications Software and Attach
Devices To Wireless Networks, RM-11361

COMMENTS
OF THE AD HOC PUBLIC INTEREST SPECTRUM COALITION

EDUCAUSE
Free Press
Media Access Project
New America Foundation
Public Knowledge
U.S. Public Interest Research Group

SUMMARY

Wireless carriers are hampering innovation and raising costs by using market, technical, and contractual barriers to limit consumer choice and reduce competition in communications software and consumer equipment. Some carriers use an embedded phone ID to ensure that every phone connected to the network was purchased from the carrier. Other carriers “lock” the phones they sell, preventing the phone from being used on any other network but the original carrier’s network. U.S. carriers have refused to approve certain handsets for use on their networks, and have repeatedly required handset manufacturers to “cripple” consumer-friendly features on other handsets before offering them for sale.

If consumers could easily switch providers, the above behaviors would likely be corrected by the market. But most carriers employ long-term unilateral services contracts as a typical condition of purchasing a handset / service bundle. These practices deny consumers their choice of equipment, inhibit competition from unaffiliated equipment manufacturers and thus harm consumer welfare.

The Ad Hoc Public Interest Spectrum Coalition (PISC) support the Skype Petition’s request to apply the Carterfone principles to wireless services. Under Carterfone, wireline consumers have the right to attach equipment and use applications of their choice. Wireless consumers deserve the same innovation-spawning rights.

We further request that the Commission adopt and enforce non-discrimination requirements for wireless Internet access networks. Wireless carriers actively interfere with consumer access to Internet content and services; therefore, the Commission, under its own reasoning in the 2005 Broadband Access Policy Statement, should prohibit wireless carriers from discriminating against consumer-chosen equipment, applications and content. Just as Carterfone and its progeny have prevented wireline carriers from leveraging their market power to limit consumer choice and competition in adjacent markets, CMRS carriers should not be allowed to leverage exclusive government spectrum licenses to thwart competition and restrict consumer choice in the related and rapidly evolving markets for wireless devices, applications and content.

Because wireless broadband Internet access services are just emerging as a potential competitor and complement to wireline broadband access, it is critical that the Commission move swiftly to establish a level playing field with respect to basic consumer protections. As 4G technologies evolve, Internet access over wireless networks should increasingly serve as both a supplement and as a potential substitute to wireline broadband access. The need to extend basic consumer protections to all competing platforms for broadband Internet access is particularly salient in an oligopoly market where the three largest CMRS carriers are joint ventures with the largest companies that comprise the duopoly for wireline broadband access.

Finally, we urge the Commission to also investigate current practices regarding wireless consumer service agreements. We believe these long-term unilateral agreements harm consumers and prevent market corrections.