Award Winning Blog

Sunday, November 24, 2013

News Flash: Airlines Discover Wireless Profit Center; Forget About Harm to Cockpit Communications

After years of claims that in-cabin wireless use would risk calamity, the airlines now want the public to believe any wireless access regulation--and the failure to make timely deregulation-- results from government inflexibility and inertia.  Why the change of strategy? 

The airlines want to "monetize" wireless access making it another profit center along with checked baggage and snacks.  But to fully do so they need to undo several decades of claims that wireless handset use would cause--or at least risk--harmful interference with air traffic control communications and other essential avionics.

    The restrictive FAA/FCC regulations resulted from active airline participation with a different rent seeking strategy.  The airlines' motivation did not solely stem from concern about consumer welfare.  Instead they wanted to protect their Airfone monopoly deal with GTE and later BellAtlantic/Verizon.
    Over time wireless has migrated from voice/text only to a vast array of data and applications.  The airlines now need to refute the avionics harm rationale they vigorously advocated in the first place.  True to form, sponsored engineers and now economists are retained to claim the need for immediate deregulation of "job killing" regulations.  These researchers join with more clearly defined stakeholders to vilify regulatory inertia, etc. 
    So now the avionics harm risk does not exist, if it ever did.  Smartphones always have had the ability to reduce transmission power to the lowest wattage needed making it highly unlikely that in cabin interference could result.  Also the airlines now have a transmission routing scheme, albeit overly costly, that eliminates the avionics risk by locating the necessary higher wattage link to an outside the cabin antenna for ground tower, or satellite access.

    My takeaway from this case study: it's easy to blame government regulators as inflexible.  But the political process forces these regulators to accommodate well-financed stakeholders like the airlines.  Belatedly the airlines have come to understand that wireless can become a lucrative, new revenue center.  So they launch a "public interest" campaign to persuade the FAA/FCC to remove now unnecessary, inefficient and costly regulations they helped create.  Sadly the true public interest has suffered for the decades of unnecessary handset restrictions.
    Also consider this irony: back on earth the wireless carriers have spent billions convincing Congress and the FCC that subscribers should not have certain access freedoms, including the "right" to unblock a fully paid for handset.  The wireless carriers claim that subscribers have no legal right to use a handset to access a competitor even if the subscriber no longer is bound  by a service agreement and even after the carrier has recouped any handset subsidy it offered the subscriber.  Some subscribers have resorted to "illegal" self-help strategies instead of asserting their right of ownership.

    I marvel at how wireless carriers can regulate and constrict individual economic freedoms, including the right to control fully owned property like handsets, including ones bought on an installment basis during a two year subscription term.  The FCC has a longstanding Carterfone policy that would prohibit such consumer restraints on corded handsets.  Sadly the FCC has bought bogus concerns about radio spectrum harm raised by the wireless carriers who benefit from the restrictions they impose in subscription agreements.

Some Brief Comments on Terminating the PSTN

NPR's All Things Considered covered the PSTN termination story including some words from me: