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Draft bill could unlock iPhone in U.S.

updated 06:20 pm EST, Tue February 26, 2008

Law could unlock iPhone

A new draft law in the U.S. sponsored by Rep. Ed Markey (D-Mass.) would require every mobile provider to offer subsidy-free wireless customer equipment, effectively breaking the exclusive deal between Apple and AT&T over the popular iPhone and allowing all owners of that device to subscribe to a wireless carrier of their choice. A hearing is scheduled on the draft bill for tomorrow morning, and a lobbyist for CTIA-The Wireless Association representing the major wireless carriers is already scheduled to speak about the bill.

The bill, titled 'Wireless Consumer Protection and Community Broadband Empowerment Act,' would establish new rules for wireless carriers that include offering unsubsidized service as well as clearly disclosing rate plans to customers in a "clear, plain, and conspicuous manner," according to News.com.

Under the draft law carriers would be obligated to provide more detailed maps of their network coverage areas, and would be forced to allow customers to cancel contracts for any reason without penalty within the first 30 days as well as prorate any fees associated with leaving a contract early. Wireless carriers argue that early termination fees help cover the cost of subsidized cellphones that come as part of various plans, and customers currently looking to purchase an iPhone are required to sign up for a 2-year service contract with AT&T in order to use the cellular handset in addition to paying the purchase price of the device.

A sizable portion of iPhone purchases are also estimated to wind up in the hands of 'unlockers,' or users who purchased the device without intending to sign up for an AT&T service plan but instead use software hacks to 'unlock' the phone for use with a carrier of their choosing. Apple has fought a constant battle since it began shipping the iPhone in late June, releasing software updates that routinely break various hacks released to unlock its handset for use with non-AT&T providers.




by MacNN Staff

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Comments

  1. Guest

    Joined: Dec 1969

    0

    Real Cost

    And lets watch all these iPhone users squeal like stuck pigs when they find out the real cost of the technology in their hands.

    They are so gonna be surprised to see it up over US$1000!

  1. vasic

    Joined: Dec 1969

    0

    Not quite that high...

    The actual retail cost of the iPhone in the US will be between $750 and $850. That is exactly how much Apple is receiving for the device, when AT&T kickbacks are included in the price.

    This is of very little concern for Apple (or any other handset maker, for that matter). The US market has so far mostly been shielded from the actual prices of mobile handsets due to these convoluted contracts and subsidies. With this legislation in place, it will be apparent how much these phones actually cost (some are more expensive than cheap laptops). Many EU jurisdictions have such laws and they haven't really killed the game for the carriers (nor for the manufacturers). Contracts continue to be popular, for obvious reasons (seemingly free phone, in exchange for something one would be probably paying anyway).

  1. exca1ibur

    Joined: Dec 1969

    0

    Hope it's not just Apple

    I hope this extends to ALL phone makers and not just Apple. All customers should be able to buy any phone they wish and use them with any compatible carrier they choose.

    If I have to pay a high price for the phone to not get locked into a contract, I'm all for it. So if my carrier gives me crappy customer support, I can take my business somewhere else and not have to be held hostage for 2 years. As it is now, if you are locked in for 2 years, customer support isn't an issue because you are going to get screwed one way or the other.

  1. Guest

    Joined: Dec 1969

    0

    Read the Bill!!

    The Bill states that wireless carriers must offer "a" plan with no subsidies. It does NOT say that a carrier must offer "ALL" plans without subsidies.

    This will have no effect on iPhone.

  1. nhmlco

    Joined: Dec 1969

    0

    What choice?

    "... hacks to 'unlock' the phone for use with a carrier of their choosing."

    Since the iPhone is a GSM-based phone, the only other carrier "of choice" in the US would be T-Mobile, which is about 1/5th the size of AT&T. As Verizon and Sprint are both CDMA-based networks, the bill as it stands gives little additional choice to iPhone users.

  1. unity@mac.com

    Joined: Dec 1969

    0

    GSM

    Why does everyone assume ATT and T-Mobile are the only GSM carriers? They are the only NATIONAL carriers, there are MANY more carriers out there.

  1. gjas18

    Joined: Dec 1969

    0

    tmobile

    Most people seem to forget that T-Mobile uses almost all of the same towers as AT&T through their roaming agreements. So the coverage area is virutally identical.

  1. chadpengar

    Joined: Dec 1969

    0

    re: tmobile

    "Most people seem to forget that T-Mobile uses almost all of the same towers as AT&T through their roaming agreements. So the coverage area is virutally identical."

    This is not true. It is only true in a few small selected markets. I have both and their coverage areas almost everywhere are much different. T-Mobile had at one time a webpage that told which areas they had agreements with AT&T about.

    Also, remember that T-Mobile is 1900mhz only while AT&T is both 850mhz and 1900mhz. The 850mhz markets are where AT&T (or its predecessors) held one of the two (A or B) analog wireless franchises back in the day and when they came out with digital, they overlaid it on their analog networks. Those places with AT&T at 1900mhz are where AT&T did NOT have the analog franchise and came in as a digital only competitor later on. (Or they run 1900mhz and 850mhz in the same area).

  1. Guest

    Joined: Dec 1969

    0

    If iPod touch is $300 ...

    ... then unsubsidized iPhone can't be $1,000.

    Are we to believe that just the phone part of the iPhone costs Apple around $600 (or even half that)?

    Bollocks ...

  1. climacs

    Joined: Dec 1969

    0

    unlocked

    I seem to recall that in France, Apple was required by law to offer an unlocked iPhone, so they did. For 1,000 euros.

    This bill is ridiculous. The whole reason iPhone is locked to AT+T is because it required AT+T to make a significant investment in its network in order to accomodate it. What was the last handset which demanded a carrier to upgrade its system?

    If you really want an iPhone, you should be alright living with AT+T's network. If not, there are so many other phones you can buy unlocked and unsubsidized. No one has a constitutional right to an unlocked iPhone.

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