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Think Tank Blasts FCC Wireless Investigation

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Title

Think Tank Blasts FCC Wireless Investigation

Government Intervention Would Make Cell Phone Market Less Competitive
 
Washington, D.C., August 26, 2009

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—Tomorrow,
the Federal Communications Commission is expected to announce a "three-pronged
probe
" of wireless industry practices at its Open Commission meeting. The
FCC's probe will likely focus on exclusive cell phone deals, open access
policies, and billing procedures.

Technology policy scholars at the
Competitive Enterprise Institute are questioning the merits of a possible FCC
investigation.

"The wireless industry is the last place regulators should
be looking for alleged anti-competitive behavior. The wireless market is
intensely competitive, and consumers enjoy a dizzying array of competing mobile
platforms and service arrangements," said Ryan
Radia
, Information Policy Analyst. "Consumers looking for a mobile handset
can select from the open source HTC G1 to the walled-off iPhone, and everything
in between. In addition, practically every big wireless provider offers both
long-term and month-to-month service options. Where is the anti-competitive
behavior?"

"The FCC's rumored investigation appears to be an
agency-serving attempt to enable the Commission to write endless rules and host
countless workshops about the wireless sector," said Wayne
Crews
, Vice President for Policy and Director of Technology Studies.
"Genuine market-driven competition -- not artificial, government-imposed
'openness' -- is the best way to promote consumer choice. Launching
'three-pronged inquiries' into frontier industries like multimedia wireless
services will only cement an authoritative regulatory role in the
industry."

"It's especially strange that the FCC is fretting over the
wireless industry when the Commission itself is to blame for limiting
competition in wireless services," said Radia. "Why isn't the FCC investigating
its own misguided allocation of America's airwaves, a huge portion of which
remains subject to decades-old rules that protect vested interests at consumers'
expense?"
 
Radia added, "If the FCC is truly interested in promoting
wireless competition, it should simply expand the range of spectrum up for
auction. If more frequencies were on the market, their prices would decline, and
more firms could try their hand in the wireless business.”

###
 
The Competitive Enterprise Institute is a non-profit,
non-partisan public interest group that studies the intersection of regulation,
risk, and markets.