WASHINGTON—By the end of the year, cell phone users will be entitled to keep their phone numbers if they switch to a new service provider, a federal appeals court decided today in rejecting a plea from the wireless industry to overturn the obligation. However, the industry may go back to court this fall to continue fighting the rules, so check back in November before switching.
A three-judge panel of the U.S. Court of Appeals for the District of Columbia Circuit sided with the Federal Communications Commission in upholding rules regarding number portability, which require service providers to "port" a customers number to a new provider on request, beginning Nov. 24.
"The simple truth is that having to change phone numbers presents a barrier to switching carriers, even if not a total barrier, since consumers cannot compare and choose between various service plans and options as efficiently," Judge Harry Edwards wrote for the court.
The FCC in 1996 gave the wireless industry about three years to prepare for number portability, ordering carriers to provide the service in June 1999. However, the Cellular Telecommunications Industry Association convinced the FCC to postpone the deadline to 2002. Last year, the commission gave the industry another one-year extension, but it refused to let carriers off the hook permanently.
"[I]t was reasonable for the FCC to conclude that wireless consumers would switch carriers at even higher rates if they could keep their phone numbers," Edwards wrote in the decision issued Friday. "The current high switching rate does no more than establish that some consumers are willing to pay the additional costs associated with changing numbers in order to change service providers."
CTIA (renamed the Cellular Telecommunications & Internet Association) expressed disappointment today in the decision, charging that it puts pressure on the FCC to define how number portability must be achieved or else witness "chaos" in the marketplace.
"There are only 24 weeks between now and the portability deadline, but the basic `how tos have yet to be addressed," said Tom Wheeler, president and CEO of CTIA. "If there is to be number portability in November, the FCC must announce final rules by Labor Day or consumers will find chaos in the market."
The FCC has the authority to forbear from enforcing rules that it decides are not necessary. Arguing that "necessary" means "absolutely required," CTIA and Verizon Wireless tried to convince the court in April that number portability is not necessary because there is sufficient competition in the wireless market. The court disagreed, taking the industry to task for its stance. "In the instant forbearance context, application of petitioners definition of `necessary would lead to an absurd result, because it is difficult to imagine a regulation whose enforcement is absolutely required or indispensable to protect consumers," Edwards wrote. "[W]e think that it would defy common sense to adopt a construction of "necessary" that can never be met." For now, wireless carriers are ordered to prepare for number portability by the November deadline, but as even the court noted in todays decision, the industry may be able to bring the FCC back to court once the deadline arrives.