In separate announcements yesterday, Verizon Wireless and AT&T took welcome steps towards greater openness in the wireless industry. By “openness,” I mean the extent to which wireless networks allow the use of devices and services that aren’t affiliated with the operators of those networks. Verizon Wireless said it would work with Google to provide fully open wireless phones running Google’s Android operating system. AT&T said that it would start allowing iPhone owners to run VOIP services, including Skype, when connected to AT&T’s 3G wireless network. (iPhone users previously could use VOIP only when connected to the Internet via a Wi-Fi hotspot.) These are significant announcements in themselves, but they also illustrate a broader trend. Verizon Wireless decided to open its network to third party devices and applications back in 2007 — a decision CDT applauded as a “major shift with tremendous potential to spur innovation” — and the iPhone, despite occasional controversies over the approval process, famously has spurred a huge market in third party applications.
In short, carriers are now well aware that open models offer a great deal of commercial power and appeal. Still, the timing of all this is interesting, coming shortly after the FCC Chairman announced that the agency plans to propose openness rules that would, for the first time, extend to wireless. Network operators will no doubt argue that yesterday’s developments are more evidence that the industry is headed in the right direction and that no government action is warranted. But the fact that this was reported as news highlights that the wireless and wireline Internet start from different traditions and assumptions. You don’t read many press stories about DSL or cable modem providers making decisions about what computers or online services they will allow customers to use. The general expectation is that those decisions are in the hands of users, and that the network operator doesn’t exercise any kind of gatekeeper control over what users choose to do with the connectivity they purchase. That is the expectation that “Internet neutrality” rules would seek to protect and preserve. It is an expectation that can and should extend to Internet access via wireless; as the FCC Chairman noted, the means used to access the Internet shouldn’t affect the degree of openness the medium provides.
Yesterday’s announcements show a very encouraging trend, but they also show that for wireless Internet access, openness is a relatively novel concept, expectations are still evolving, and key decisions are still in the hands of network operators. As a result, this is an area where a little government pressure may be able to play a helpful role in encouraging and solidifying the move towards a more open model — a model that will preserve the Internet’s ability to serve as a unique platform for innovation even as more users reach it via wireless. Would wireless carriers embrace openness regardless, without any government encouragement? Possibly. The trend predates the FCC’s latest action, and carriers no doubt welcome the way the flood of creative applications they have unleashed increases demand for their services. But discussion of openness issues by the FCC and, as a result, in the press, also helps focus consumer attention on these matters and helps shape expectations. It is hard to fully separate responses to market demand from responses to the policy debate. In the end, if the open nature of wireless Internet services is an important policy goal — and CDT certainly thinks it is — then official policy should reflect that.