“Gee, I sure love paying for a phone that can’t be moved from my draconian cell phone network,” said no one ever. But that appears to be the sentiment echoed by American networks AT&T and T-Mobile in response to the Federal Communications Commission (FCC).
The companies are objecting to the FCC’s proposed rule that all phones should be unlocked no more than 60 days after purchase.
The FCC put forth the proposal in a rare bipartisan move, with all five Commissioners (both Republican and Democrat) in favor. The rule could go into effect 45 days after publication in the Federal Register, making the new regulatory action effective later this year or in early 2025.
Both T-Mobile and AT&T have issued objections, as reported by Ars Technica. T-Mobile claims that getting rid of its rules that prevent unlocking pre-paid phones for an entire year would cause subsidies to be “reduced by 40% to 70% for both its lower- and higher-end devices.” T-Mobile recently increased its unlock period on pre-paid phones from 160 to 365 days for its Metro by T-Mobile (formerly MetroPCS) subsidiary, something the FCC noted in its initial proposal in July.
AT&T’s official response was similar. “Requiring providers to unlock handsets before they are paid-off would ultimately harm consumers by creating upward pressure on handset prices and disincentives to finance handsets on flexible terms,” said AT&T’s representative. “Further, AT&T reiterated its concerns that the FCC may be overreaching its authority by imposing such rules.”
In my editorial opinion, this is all legalese for “if the FCC puts these rules into action, we’ll sue to get rid of them.” Given the corporate-friendly nature of many American courts, which have severely hampered federal agencies’ ability to regulate various industries, there’s a good chance carriers would prevail if it came to that.
As both a long-time observer of the American wireless industry and an obligate customer of the Big Three carriers by proxy, their complaints of increased prices and no effect on competition ring hollow to me. Carriers are going to discount phones to try and hook new customers regardless of what happens — they’ve been doing it for decades.
And the competition has already crossed this hurdle. Verizon, generally one of the most restrictive carriers, will unlock paid-off phones 60 days after purchase, allowing customers the freedom to buy cell service from whichever company they choose.
This isn’t exactly an altruistic move, as it was agreed upon when Verizon licensed the 700MHz spectrum. But if Verizon can offer this kind of policy without any obvious downsides for the last five years, AT&T and T-Mobile really have nothing to complain about.