[Special Section on Net Neutrality] Wireless Carterfone

Timothy Wu


Over the next decade, regulators will spend increasing time on the conflicts between the private interests of the wireless industry and the public’s interest in the best uses of its spectrum. This report examines the practices of the wireless industry with an eye toward understanding their influence on innovation and consumer welfare.

In many respects the mobile wireless market is and remains a wonder. Devices that were science fiction 30 years ago are now widely available. Over the last decade, wireless mobile has been an “infant industry.” Yet today, in the United States, there are more than 200 million mobile subscribers, and mobile revenues are over $100 billion. As the industry and platform mature, the wireless industry warrants a new look.

This report finds a mixed picture. The wireless industry, over the last decade, has succeeded in bringing wireless telephony at competitive prices to the American public. Yet at the same time we also find the wireless carriers aggressively controlling product design and innovation in the equipment and application markets, to the detriment of consumers. Their policies, in the wired world, would be considered outrageous, in some cases illegal, and in many cases simply misguided.

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