Imagine this; you access the Internet from your mobile phone, and use a third party application (Skype) to make phone calls without burning up your costly minutes. It may seem like a dream that will never come true, but Skype is looking to apply a 1968 ruling by the U.S. Federal Communications Commission to free the country’s mobile phone industry; this would allow the use of third party applications and unlock all the mobile carrier restrictions.

If anyone has their game down with VOIP (voice over Internet Protocol), it’s surely Skype. They haven’t been at it for an excessive amount of time, but they’ve made a huge impact.

Skype recently petitioned the FCC to enact what is known as the “Carterfone” rules to the cellular world. This ruling, at the time, allowed customers to hook up any device to the phone network, assuming the device would not cause the physical network any harm.

Prior to the Carterfone rules, AT&T would sue companies which would sell phones/devices that could attach to the network in an effort to monopolize the phone industry. The FCC wouldn’t have of it; and made the ruling to allow 3rd party telephones and devices on AT&T’s network.

The term “Carterfone” was coined from an inventor, Thomas Carter, who created an inexpensive phone that could be used in place of the exclusive AT&T phones. AT&T battled the FCC over the Carterfone ruling before being turned down.

It was with this ruling that helped spawn inventions such as the fax machine and telephone modems. Today, the Carterfone rules have also carried over to the cable communication networks, but have not yet been applied to wireless networks; this is what Skype seeks, and, based on past history, they may have a pretty good chance.

According to Christopher Libertelli, senior director of government and regulatory affairs for Skype, there is no reason why the ruling on the phone and cable networks should not apply to mobile networks.

“We want to allow our users to use the Skype software where ever they are,” said Libertelli, ”we want to make sure the policy is set in the right direction so that when Skype users want to use it on mobile devices, they’ll be able to.”

With approximately. 197 million cell phone users in the US, this would open up a huge market for Skype; however, the potential revenue lost from the mobile carriers would certainly be passed to the users in the form of higher fees and a much larger cost for wireless bandwidth.

In addition, this ruling would let any device connect to cellular networks – including cell phones from other providers – and would gradually open the door for handsets that use VOIP. The future may also hold applications that allow you to freely share images and ringtones; this would surely give companies who deploy  DRM techniques a run for their money. 

Steve Largent, president and CEO of the Cellular Telecommunications and Internet Association, believes that this ruling, if enacted, would freeze innovation. “Skype’s self-interested filing contains glaring legal flaws and a complete disregard for the vast consumer benefits provided by the competitive marketplace,” Largent said.

However, Skype’s Libertelli added that, “what we’re trying to do is get in front of that trend so that policy is set in the correct way,” noting that the company (Skype) has a huge job ahead of them in educating cellular companies about the many new ways their networks could be used after the Carterfone ruling.

Tim Wu, a law professor at Columbia University, published a report earlier this month in support of the Carterfone rules applying to cellular networks, saying, “They (cellular companies) have used  power to force equipment developers to omit or cripple many consumer-friendly features,” he said. “Carriers have also forced manufacturers to include technologies, like ‘walled garden’ Internet access, that neither equipment developers nor consumers want. Finally, through under-disclosed ‘phone-locking’, the U.S. carriers disable the ability of phones to work on more than one network.”

Many consumers have already found various ways around their cellular restraints; users with smart phones running Windows Mobile can download and use Skype despite the carrier’s restrictions.

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Entry was posted on Sunday, February 25th, 2007 at 12:32 pm under Cell phones.

Read more entries by George Gardner.
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