Who's to blame for the high cost of wireless comms?
By Tom Foremski - January 23, 2008
Wireless companies don't want to be forced to advertise the full cost of monthly plans, which include hefty taxes and fees to state and federal agencies. The Supreme court declined the case. (Hat tip Jeff Nolan.)
From Cnet by Anne Broache: Supreme Court rejects cell-phone tax case
The case at hand, which pitted Sprint Nextel and T-Mobile USA against state utility regulators, centers on whether states should be allowed to forbid wireless carriers from breaking out various state and local taxes as line-item fees on a customer's bill....The wireless companies, naturally, maintain they should be able to establish a visible separation between the base prices of their services and the fees required by various regulators. States and localities have increasingly been passing laws prohibiting those line items expressly in order to "hide" arguably unpopular taxes and fees from consumers, Sprint Nextel and T-Mobile said in their brief to the high court.
I have no sympathy for either side. Cell phone rates are way to high. Let's have truth in advertising and show the full cost of monthly service.
The state and federal agencies are in cahoots with each other anyway, to make sure that no technologies get around their stranglehold on wireless communications. Regulation means you have the government on your side and competition is pushed well to the outside because of onerous requirements.
This cosy relationship between the two sides in this case, enables a wireless digital divide that is bad for innovation and bad for Silicon Valley. Europeans say the US is way behind in mobile comms, and they are right, and this is why.
The wireless companies have shown themselves to be anti-technology. They dumb down the cell phones, they restrict access to the latest communications technologies that could swiftly decrease our cost of providing wireless communications.
And with the regulators on their side, the wireless companies can keep a firm hold on a gatekeeper role that does not offer a level playing field for competition.
The wireless carriers have become the center for a thousand spokes of innovative online services, many of them from large and small SIlicon Valley companies. This is an incredibly powerful position because the wireless carriers have no obligation to carry competitive services over their networks, in what is sometimes called "net neutrality."
Let's see the true price that these modern day Luddites are charging us and let's recognize the true cost to society and to this country's business innovation.
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