Transforming Network Infrastructure Industry News

[February 23, 2007]

Is Skype's FCC Petition For Public Or Self Interest?

TMCnet Web Editor
Skype (News - Alert), the company that offers low-cost Internet calling, is apparently not content to limit availability of its services to only broadband networks.
Earlier this week, Skype filed a petition with the Federal Communications Commission to force wireless carriers to open their networks and allow third-party hardware and software applications to use them. In effect, Skype’s own software would now be able to run on cellular networks.
In filing the petition, Skype is taking a page from the past by asking the FCC to enforce the Carterphone principle—a rule enacted in response to AT&T (News - Alert) holding a monopoly over wired networks. The rule forced AT&T to let consumers connect non AT&T phones and devices to its networks.
Skype’s petition expressed concern that wireless carriers and handset manufacturers were stifling innovation in the wireless and mobile sector, against the public’s interest.  For instance, one carrier practice Skype cited in the petition was the locking of handsets in the U.S. to specific carriers, whether it be Verizon, Cingular (News - Alert), Sprint, or T-Mobile.
By contrast, Skype stated in the petition that consumers in most European and Asian countries can readily purchase unlocked headsets they can use with separately purchased SIM cards.
The petition also claims that wireless carriers exerted such power over mobile device design that some features, such as Bluetooth and Wi-Fi connectivity, were stripped from some advanced phone designs.
Though Skype makes some valid points in its petition, the company has so far been unable to muster an outpouring of support. Not surprisingly, the company has been dismissed by the mobile sector as self-serving and against consumer interests. But neither has there been much support from other technology companies that might benefit from loosening wireless network regulations.
Unlike decades ago when one could easily identify AT&T as an obvious monopoly, convincing the public to rally against wireless carriers is going to be more difficult. Who’s the main culprit here? Verizon Wireless? Cingular? Sprint? T-Mobile? And how many really believe these carriers twisted the arms of Motorola, Nokia (News - Alert), and other mobile phone makers when these companies reported record handset sales in recent years?
Do consumers really believe there’s a monopoly among these carriers when many routinely port their mobile numbers from one carrier to another and take advantage of free or low-cost handset deals. How about the dazzling array of different phones—many with cameras and Internet access—available to consumers despite Skype’s contentions of missing features. Is that a lack of choice that hints of an industry monopoly?
And the petition may not help Skype drum up much support for Internet-based calling, The concept of Internet-based calling remains a novelty to many—with concerns lingering over issues such as poor voice quality.
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Spencer Chin is a contributing editor for TMCnet. To see more of his articles, please visit his
columnist page.

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