The Federal Communication Commission is looking into competition among wireless providers in the United States. Right now, four national carriers control about 90 percent of the cell phone market, with AT&T and Verizon holding down 60 percent. The FCC is looking into how this seeming stranglehold of a few carriers affects innovation and consumers.
FCC Chairman Julius Genachowski said, "I hope the new wireless competition report will help set a standard for fact-based, analytically deep analysis of the mobile industry... It is essential that the commission develop policies that encourage a new generation of innovators, working with new tools, on new platforms, and having an extraordinary impact on our economy and society."
The FCC is also examining exclusive deals between handset makers and carriers, like the one linking AT&T and the iPhone, as well as looking into the industry's billing practices. Here's the point and counter-point:
Andrew Jay Schwartzman, president of Media Access Project:
"This investigation is long overdue... The country's four major wireless providers have enjoyed the fruits of market power for too many years, at the expense of the public's ability to gain widespread access to low-cost mobile broadband services."
CTIA, The wireless industry's trade group, president Steve Largen:
"[The U.S.] has the least concentrated wireless market on the planet.... The wireless ecosystem -- from carriers to handset manufacturers, to network providers, to operating system providers, to application developers -- is evolving before our eyes, and this is not the same market that it was even three years ago."
I have a feeling that once it's finished its studies, the FCC is going to find that cell phone companies use their positions at the top of the electronic food chain to discourage innovation and competition from new companies, and often take advantage of their near-monopoly to overcharge subscribers, lock people into ridiculous contracts, and institute bizarre and unfair billing practices. In other words, the jig is (hopefully) up, cell phone carriers!