Approval of Handset Unlocking NPRM Expected with Possible Added Questions

An FCC proposed handset unlocking NPRM will likely receive unanimous approval at the commissioners' open meeting Thursday, probably with minimum tweaks, lawyers and others in the proceeding told us. Currently, among the national carriers, only Verizon is subject to broad unlocking requirements, though T-Mobile faces some owing to its Mint Mobile and Ultra Mobile acquisition. The notice proposes all mobile providers unlock a consumer’s handset 60 days after it's activated.

Because the NPRM, as proposed, has industry and public interest group support, FCC Chairwoman Jessica Rosenworcel is hoping for a 5-0 vote and is probably reluctant to make many changes, industry lawyers said. Some expect the FCC will add general questions on other items affecting competition.

Among the eight ex parte filings in docket 24-186, Tango Networks, a wireless provider with operations in the U.S. and other nations, raised business concerns as a reason for proposing unlocking requirements (see 2407150043). Tango provides underlying phone service that's part of some larger communications platforms.

T-Mobile and AT&T are the only carriers in the world that still lock handsets, Andrew Silver, Tango chief technology officer and co-founder, told us Tuesday. Verizon has shown carriers “are still going to be around, even with unlocking,” he said.

“We connect mobile phones to a company’s unified communications system,” Silver added. Companies transfer their employees’ mobile phones to the Tango service, he explained. “We sell this in the U.K. and all over the world.” In the U.S., companies often can’t transfer employee phones to Tango’s system because of handset locking, he said. In the U.S., when you lock one SIM, “you lock all of them." Tango is asking the FCC to make the rules retroactive to address the issue, Silver added.

The service Tango offers is "an example of one of the innovations ... being lost because phones are locked,” Silver said. “We have been searching for how to get” the FCC “to look at this problem for years, and it’s like a dream come true for us that they’re finally doing this.”

CS Hawthorn raised similar concerns. “The locking of mobile phones by mobile operators has prevented subscribers from adding secondary services (subscriptions) to their dual SIM devices that offer unique, tailored and highly beneficial solutions for businesses, agencies and consumers,” CS Hawthorn said. Companies that want to subscribe to business-specific mobile services “continue to be impeded from doing so because significant portions of their corporate-liable mobile devices as well as the … devices owned by employees are locked and therefore cannot add new and innovative business services,” the company said.

“For many years, consumer advocates have supported making the 60-day automatic unlocking rule that applies only to Verizon an industrywide rule,” said Michael Calabrese, director of the Wireless Future Program at New America. In a three-major carrier market with the lowest customer-switching rate in history, “anything that can improve consumer choice and competition is in the public interest,” he said. “Because regulatory asymmetry distorts the market,” Calabrese predicted a 5-0 vote to move forward on the NPRM. His group didn’t file a response to the draft NPRM, but was part of a larger group seeking the NPRM (see 2406250049).

A uniform unlocking policy “is likely to increase the information available to consumers, reduce possible consumer confusion, and improve consumer choice,” the draft NPRM said: Reducing the locking period “should increase a consumer’s ability to change providers based on price, service characteristics, new technology, or changes in a consumer’s circumstances or needs, which should increase consumer welfare.”

Incompas supported the draft NPRM in a filing last week and “encouraged the Commission to request comment on other practices that may be impeding the ability of consumers to exercise choice and thereby harming competition.” Incompas President Angie Kronenberg spoke with an aide to Rosenworcel.

Among other filings, Public Knowledge asked the FCC to also seek comment “on whether carrier practices relating to number porting -- either accidentally or by intent -- create barriers to switching.” PK noted (see 2407050008) that the last time the FCC sought comment on porting was 2009. CTIA asked the FCC to add questions to the draft (see 2407110022).