Verizon Wireless appeals FCC's open device, platform order; Wireless auction showdown looms

Verizon Wireless appeals FCC's open device, platform order; Wireless auction showdown looms

Summary: Verizon Wireless has sued the Federal Communications Commission for overstepping its power when it endorsed two conditions for its auction of 700 MHz wireless spectrum. Specifically, the FCC in July embraced the concept of open applications, the ability to download any application, and open devices, using handhelds for any wireless network.


Verizon Wireless has sued the Federal Communications Commission for overstepping its power when it endorsed two conditions for its auction of 700 MHz wireless spectrum.

Specifically, the FCC in July embraced the concept of open applications, the ability to download any application, and open devices, using handhelds for any wireless network. Verizon Wireless  says the FCC doesn't have the power to create those  rules (Techmeme, Verizon Wireless appeal document, Reuters story). The looming court spat illustrates how the stakes are rising quickly ahead of the FCC's January wireless spectrum auction.

Back in July the FCC basically met Google halfway. Google dangled $4.6 billion as a minimum auction bid if the FCC agreed to four conditions.

Not surprisingly, Verizon Wireless is miffed. In the U.S. District Court of Appeals for the District of Columbia, Verizon Wireless petitioned for a review of the FCC's auction rules. Verizon Wireless is seeking the review on the grounds that the FCC's order "exceeds the Commission's authority."

According to Verizon Wireless, the FCC's order violates the U.S. Constitution, the Administrative Procedure Act and is "arbitrary, capricious, unsupported by substantial evidence and otherwise contrary to law." Google disagrees.

We'll let the lawyers figure it out, but there will be some interesting outcomes to consider:

Did the FCC overstep its authority? If so does it need Congress to mandate open platforms and devices in the wireless industry? Let the lobbying begin.

Clearly, Verizon Wireless is protecting its walled garden, which is its right. Google has its own motives. In the end, don't be surprised if the players change, but the goal of the walled garden remains.

The stakes for this 700 MHz auction are growing by the day. If you're Verizon Wireless it makes complete sense to appeal. If it wins, Google isn't likely to bid. An auction sans Google would mean Verizon Wireless would have one less well-heeled bidder to worry about.

Topics: Verizon, Google, Government, Government US, Networking, Wi-Fi

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  • They may be right, the FCC doesn't "make" law.

    The FCC doesn't make laws, they do however make rules. The problem here is that its a very fine line between rules and laws.

    With that said, I believe this issue is far reaching and as such really should be handled in the legislature instead of the FCC itself.

    The problem with that is the legislature seems dead set against "neutrality" when it comes to anything dealing with the net or communications and the lobbists involved have very, very deep pockets.
  • How about all Internet big boys kick ATT and Verizon to the curb?

    Microsoft, Google, Yahoo, and several others could get together and buy this spectrum and then treat it like the Internet on landlines is treated... wireless can be just another IP network...

    Voice service is old... it is no longer worth what is being charged... like all old technologies it has become virtually worthless other than the strangle hold the current phone companies hold to force us to keep paying crazy money for a technology that has been made into just a commodity because of the worldwide network called the Internet.

    Sending data bits is trivial in todays world... the days of companies being paid lots of money for something that can be done by any teenage coder with an Internet connection must come to an end.
    • What do you mean it is a commodity?

      It costs quite a lot of money to build and maintain a network. Thanks to previous govt regulation, the phone network isnt as extensive or efficient as it could be.

      You think "the cloud" just came into being on its own?
      • Al Sahab - The Cloud

        Al Sahab is the media production company of al-Quada, so I have assumed the poster is playing off that with this post.

        It is also a recent marketing term that was to have replaced Mirosoft's Live product line. May they fire that advertisement firm - oh darn - Microsoft now owns that marketing firm. Is al Qaida a client? What incompetency.

        It is just surreal. But seriously, AT&T was given a legal monopoly on last mile telephone connectivity because that supported the democracy and well being of residents and workers, and there was a need to get the infrastructure built fast. The monopoly only ended a few years ago but AT&T was fully compensated and made its profit. We have almost universal access to telephony at a charge.

        Today, we recognize that voice and data and last mile connectivity can be provided by the nation's free broadband wireless TV spectrum, the less than 1 Ghz spectrum. So all that - or a lot of that - AT&T stuff is obsolete.

        Nonetheless, US tax payers have already paid once for the AT&T stuff, and they have already paid for wireless broadband TV, so now there is no great amount of infrastructure needed. It is very reasonable to expect FREE BROADBAND WIRELESS ACCESS TO WEB 2.0 at this time.

        Verizon is just going to have to make money selling iPhones or providing storage for web pages and photos or service to those who sell that kind of thing. The old business model isn't going to work without turning otherwize honest FCC decision makers in to traitors willing to privatize the dot commons.

        WIMAX - ITS OUR DIGITAL DEMOCRACY. The < 1Ghz spectrum is too valuable for any privatization. It should remain regulated by the federal government and indeed is the purpose for a central government in peace time.
  • RE: Verizon Wireless appeals FCC's open device, platform order; Wireless auction showdown looms

    Looks like somebody ticked Sir Charge off.
    No not google, its the people. How dare they dream of using new and innovative devices/applications on public spectrum. Its not 'public' spectrum ok! Stop saying that!
    What next? Better or cheaper service? No early termination fee?
  • RE: Verizon Wireless appeals FCC's open device, platform order; Wireless auction showdown looms

    Well I can tell you first hand how frustrating Verizon and their "crippled" phones are. I bought a Motorola KRZR for the features that the phone has. But because I bought it from Verizon I can't use them because they have half of the phone locked out. I have been round and round with their tech support about unlocking the phone and all they can tell me is "Sorry, that is NOT an option" and for me to call Motorola. I called Moto and I'm told that they can't unlock the phone because of the Verizon contract and even if they did it would not work on Verizon's system. I understand that they are trying to make ALL the $$$ they can from their customers but for them to advertise a Motorola phones features and then let me find out on my own that I can't even use those features is pretty close to false advertising to me. I hope they are forced to unlock their phones for their frustrated and angry customers like myself.
    • Unlock those phones

      I agree, they should be forced to unlock their phones. It's about time you guys in the
      States petitioned your congressmen/representatives to change the law so that
      phones can be unlocked, the same as in many countries in Europe.

      I know this won't be easy or happen overnight, because of so much vested interest,
      but you gotta start pushing for it. Just my 2c worth.
  • I don't think that the FCC is overstepping its boundaries

    The FCC has and always had control over the spectrum in the US as it is a limited natural resource (just like national parks, environmental resources, etc.)

    I don't know the law exactly (and IANAL), but I would say that what the FCC is saying is well within their purview as the governing body of said natural resource.

    IE: "You can use this resource, but for the good of everyone, you have to use it in certain ways or you can't buy the rights to use it."

    I feel that the national park system is much the same way in how it enforces certain rules and regulations on the use of the national parks. Sure they're open to anyone and everyone to be used, but there are few rules that you have to abide by. Sounds like the same thing to me.

    Verizon is just whining because they can't do business by locking in the consumer the way that they have up till now. Tough cookies.
    • Sorry no...

      The Congress decides quite often how public parks/land will be used. That is why you see oil wells in Alaskan parks. Its not up the the parks commision.
      • Like you said in your earlier post...

        there's a fine line.

        The FCC has been allowed to set the rules in all other spectrums of communications. I don't see any difference here. I don't see the courts ruling against the FCC. Whether Congress wants to get involved is another issue. Based soley on lobbying.

        To keep congress out of it however will require the whole of the IT industry to come together against the telcos.
      • Alaskan's own the oil; That is why they allow drillling in Parks

        This is just so surreal. Here we are 50+ years after WWII arguing like 50+ years after the US civil war about states rights.

        States rights was code for "right to own slaves or something similar" after the US civil war and state rights today is code for "right to monopolize and the right to have a monarchy".

        There are four stages of reconstruction after a war. The third stage involves the rise of terrorist groups who are nostalgic about the good old ways. The terrorist groups after the civil war were along the lines of the KKK and the Klan relied on hoods to hide who they really were. The terrorist groups after WWII are along the lines of Saudi royals and other transnational big businesses and they rely on religion to hide who they really are.

        In Alaska residents nationalized the oil. Not a drop is owned by any transnational big business. They decide where to lease drill ing sites. In the USA the < 1Ghz airwaves are nationalized. Let not a drop be owned by any transnational big business. But lets instead learn from the Alaskans.

        In Alaska transnational big business obtained leases but did not pump oil in all cases. The lease payments were based on production and nothing was paid. The lack of pumping also contributed to shortages and price hike. Think not that this same thing will happen with our airwaves. It is a guarantee. We must keep the air regulated - it can not be privatized and it really should not be leased. Instead let the federal government regulate it for the public good.
      • Oh, ok

        I stand corrected. Like I said, I didn't know the law.
  • VZW's anti-consumer behavior

    VZW forces it's subscribers to use crippled phone with buggy software and limited features to force users to subscribe to their added cost "services". Many stay with VZW only because of their perception that VZW's phone service is more available nationwide than its competition. I even have had VZW technicians tell me that VZW doesn't support equipment purchased less than 2 years ago, even though I can find resources for fixing their phones on the internet from other dissatisfied customers. How can a company get away with this type of customer exploitation? Where is VZW's sense of ethics? Why do the FTC and FCC let them do it?
  • RE: Verizon Wireless appeals FCC's open device, platform order; Wireless au

    My Verizon wireless phone is hardly "crippled", I bought it to talk to people, and it does that quite well. I even use Yahoo messenger, SMS messaging and email from time to time, and they all work. Browsing the web on a 2 inch screen? Give me a break.
  • RE: Verizon Wireless appeals FCC's open device, platform order; Wireless auction showdown looms

    Government - For the people, by the people.
    People should have a choice to use what phone they want with what carrier they want. Anyone heard of the free market economy?
  • Back to the future . . .

    Back in the beginning of cellular phones (circa 1983) all phones in the US where of one technology (AMPS) and where unlocked in that, with the right programming any cell phone could be used on either the wireline or non-wireline carrier (and most phones could be set up to roam on the other system as well). In those days we had full transparency.

    Enter PCS and the transistion to digital starting in the mid-90s. The digital standard the CTIA was pushing (IS-95, also known as TDMA) died a quick death for 2 reasons: the rest of the world went GSM, and Qualcomm came along with CDMA that promised the carriers the ability to stuff a lot more calls into each cell channel. At that same time the carriers where starting to assemble national networks.

    At this point the carriers went to the FCC and got them to repeal the rules regarding transparency and VOILA - the locked (and locked in) phone.

    So now we have a world where we have 4 national carriers, 2 on GSM and 2 on CDMA, using 3 different freguency bands. Even if we had unlocked phones we would have to start producing dual-mode phones that do both GSM and CDMA to get total transparency (there are some phones like that available but they are a VERY small percentage of the available devices).

    So what is the solution? Well first I'd say the FCC is right in returning transparency to the new 700 MHz spectrum. Just like the Southern plantation owners of 1861 liked having slaves the present carriers just love us being locked into their system. Just like with the Missouri Compromise, let us not extend this slavery to the new spectrum. Here's my idea for an "Emancipation Proclamation" for cellular users - - -

    1) Let's end the phony subsidies: sell the phones for what they are worth and let the carriers compete on service. Hey, you don't buy your TV from the cable company, right? And the cable company competes on service with DirecTV and Dish (and new systems like the SureWest fiber system out here in the Sacramento area).

    2) Unlock ALL phones. If the carriers want to offer special services for a specific phone that requires extra software, download it as an application like we do with PCs.

    3) Prohibit the crippling of phone features by the carriers. The features the phone manufacturers put in the phones should be driven by what the end user wants, NOT what the carrier wants as a method to milk more revenue from users each month. Why should I pay for the GPS module in my phone and not be able to use it with GPS software without having the carrier force me to use their "backend" that I do NOT need (the new Blackberrys are an example).

    4) Encourage the production of dual-mode phones OR, as an alternative, make the radio unit as a module that can be swapped between CDMA and GSM (the laptops with embedded broadband are built that way internally).

    It is LONG past time the FCC and Congress got some backbone and told Verizon, AT&T et all "you are a public utility using a valuable public asset (the RF spectrum), not your own private money printing machine. You WILL act in the public interest or we will yank that spectrum out from under you and let an entity that wishes to serve the PUBLIC interest use it".

    Let us begin to end "wireless slavery" now.
  • RE: Verizon Wireless appeals FCC's open device, platform order; Wireless auction showdown looms

    All phones should be unlocked for any network you desire. We buy the phones so why don't we have the right to do what we want with them. The carriers act like we only buy the right to rent them.
  • RE: Verizon Wireless appeals FCC's open device, platform order; Wireless auction showdown looms

    I'm all for an open device platform. I had a bout with Cingular when they tried to charge me $195+ for early termination. Got that reversed by complaining to the FCC and alleging abusive and dishonest business practices. I now have Jitterbug cell,

    The FCC et-al should be ashamed since the US ranks 16th or so- behind Estonia- in high speed internet access. Go figure.
  • FCC Legal Issues

    The FCC as a department of the government does have the right to regulate the area of their mandate. I think if you discuss this with a law professor or someone that specializes in business law, that they can in fact make laws in the narrow area of their mandate. Call them rules if you want. The Federal Government gave them their mandate to regulate in the area of communications. For instance the FCC is the licensing authority for radio and TV Stations.

    Still there are still some things that are more strict and are governed by laws made by congress which would supercede the authority of the FCC. The Courts are also constantly making decisions about many cases. Since the beginning of the the early days of the Internet the Telephone company has been resisting any takeover of their authority to sell communications. Just take a look at the 911 regulations and laws. There is a requirement for the 911 service for telephones to interact on a local level with 911 elements like local Police and Fire and Ambulence service. The Land based Telephone company tries to use this a way to inhibit growth in the wireless industry, when in fact the laws are archaic and make no sense.