Verizon, ATandT Must Share the Air with Smaller Carriers: FCC
While Verizon Wireless would like to "rule the air," as its ads suggest, the carrier, along with AT&T, must instead share the air, according to the Federal Communications Commission.
The FCC ruled April 7 that the two giants must work with smaller carriers so that the latter can extend voice and data roaming capabilities to their subscribers. Verizon and AT&T would charge for the service.
Such agreements currently are voluntary. Under the new order, however, those with the facilities are required to offer data-roaming arrangements to other providers, based on "commercially reasonable terms and conditions, subject to certain limitations," the FCC said in a statement. The FCC also outlined a method by which involved parties could file disputes.
In a 3-2 vote, with Democrats on board and Republicans disagreeing-believing the FCC doesn't have the legal authority to create such rules-the order was passed, with the stated intentions of increasing competition in the market and ensuring that all Americans have access to mobile data services such as email and wireless Internet access.
"Consumers expect mobile data services that will allow them to remain connected wherever they go," the FCC said in its statement. "A data roaming rule will help ensure that consumers' services are not interrupted and that coverage is available on a competitive basis."
The nation's two largest carriers have cried foul.
Tom Tauke, Verizon executive vice president of public affairs, policy and communications, told Bloomberg that the order "is a defeat for both consumers and the innovation fostered by true competition" and "a new level of unwarranted government intervention in the wireless marketplace."
Folks at AT&T weren't much happier, though had a more specific complaint. "A data-roaming mandate is unwarranted and will discourage investment," said Robert Quinn, AT&T chief privacy officer and senior vice president of federal regulatory, according to Bloomberg. "Proponents of a roaming mandate were seeking government intervention, not to obtain agreements-which are plentiful-but rather to regulate rates downward."
By creating a more competitive landscape, the order could benefit AT&T, which is in the process of trying to acquire T-Mobile-a move that some, including Sprint, have decried, saying it would hurt the ability of smaller carriers to compete. Were the deal to go through, AT&T and Verizon would control an estimated 70 percent of the American wireless market.
AT&T CEO Randall Stephenson, in an interview with USA Today regarding the T-Mobile deal, downplayed the inability of smaller carriers to truly compete effectively. Not addressing the more rural swaths of the country where the FCC's new order may more likely apply, Stephenson noted that "in 18 of the top 20 markets, the customer has a choice of five different [mobile operators]. It's a fiercely competitive market today."
Commenting on the new order, FCC Commissioner Michael Copps, a Democrat, said in a statement that it advances two key goals that he and the FCC share - to protect consumers and to promote "sorely needed" competition in the wireless market.
"These safeguards ensure that small regional carriers can hope to compete in the wireless market place while investing in their own build-out of facilities," Copps continued. "It means that their subscribers can have comparable flexibility to move about the country as customers of the wireless behemoths."
Commissioner Robert M. McDowell, a Republican, explained in his own statement his reasoning for coming out against the order. Saying he believes that "certainly it is important that all consumers, no matter where they live, work or travel, have the ability to benefit from the most advanced wireless services in a competitive market," he nonetheless finds the FCC to be overstepping its bounds and in violation of Title II and Title III of the Communications Act.
"I ... agree with my colleagues that many benefits flow from the widespread availability of data roaming," said McDowell. "Nonetheless, the Commission simply does not have the legal authority to adopt the regulatory regime mandated by this order."
The FCC explained in its general statement that it has "implemented a data roaming obligation pursuant to its authority under the Title III of the Communications Act, which provides the Commission with authority to manage spectrum and establish and modify license and spectrum usage conditions in the public interest."