Skype Jailbreak and the Unholy Alliance of Wireless Handset Makers and Carriers

News of conditional iPhone Skype access has arrived; see http://gadgetwise.blogs.nytimes.com/2009/01/09/fring-for-the-iphone-all-skype-no-gripe/?pagemode=print. I use the word conditional, because iPhone users can access the service only via a Wi-Fi connection and not via the AT&T network.

This announcement provides both good and bad news. On one hand, Apple the computer manufacturer recognizes the user benefit in constructing a handset that can incorporate many applications, including ones that the wireless carrier may not be thrilled to support. On the other hand, both Apple and AT&T have absolutely no interest in considering the iPhone property owned and controlled by consumers. This means that Apple does not protest when AT&T limits Skype access to Wi-Fi islands of connectivity. Because iPhone users frequently use their phone while moving, AT&T can tolerate the loss of some revenue in the limited instances where non-moving subscribers make Skype calls.

Many iPhone users have undertaken the warranty violating exercise of “jailbreaking” their handsets to add an “illegal” application, i.e., software either Apple or AT&T do not want users to have. Clever users will find ways to make Skype useable over the AT&T networks, but I wonder why handset manufacturers and wireless carriers have the power to condemn such user options as illegal hacking. Surely after paying rates that recoup the handset subsidy don’t iPhone users own their phone?

In a number of different forums and writings I have argued for a wireless Carterfone policy that recognizes the lawfulness of using handsets to access any service, application, software or carrier provided such access causes no technical harm. We expect such attachment freedom when using handsets attached to wired networks, as well as television sets and personal computers. But apparently in our delight with a working wireless connection we accept limitations on handset attachment freedom. Some wireless carriers disable handset Wi-Fi access, so Apple must come across as a consumer advocate of sorts.

Wireless carriers do not have to comply with the wireless Carterfone policy in part because handset manufacturers carriers do not vigorously contest handset limitations imposed by wireless carriers. With only four major carriers controlling most of the market, and locking most subscribers into two year service agreements, in exchange for the privilege to buy a subsidized handset, no handset manufacturer cares to risk its good standing with the carriers. If Nokia had more ways to sell handsets—as occurs in most parts of the world outside the U.S.—it would have far less tolerance for carriers disabling consumer welfare enhancing features like Wi-Fi access.

U.S. wireless carriers have cowed handset manufacturers into submission. With such an unholy alliance limited Wi-Fi-based iPhone access to Skype looks generous.