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Verizon Wireless Faces $1.2 Million Fine for Blocking Apps

Regulators say it violated spectrum rules when it prevented the use of 'tethering' apps

Verizon Wireless will pay a $1.25 million fine leveled by the Federal Communications Commission (FCC) for blocking subscribers' access to certain apps -- one in particular.

For a number of years Verizon Wireless has offered a “tethering” package that allowed some subscribers to connect their laptop computers to the Internet by connecting through their cell phones. At one time the company charged an extra $30 a month for this feature.

So it didn't look favorably on app developers who devised programs that allows people who weren't paying for that feature to connect their laptops through a cell phone app. Verizon Wireless then blocked access to that app.

Special rules for Verizon

AT&T did much the same thing but avoided a fine. Why? Because part of Verizon Wireless' spectrum has special rules.

When the company purchased “C Block spectrum,” it was then bound by the FCC's C Block rules, requiring licensees of C Block spectrum to allow customers to “freely use the devices and applications of their choosing.”

Presumably that means tethering. FCC Chairman Julius Genachowski says the C Block spectrum rules are not optional.

“The open device and application obligations were core conditions when Verizon purchased the C-block spectrum,” Genachowski said. “The massive innovation and investment fueled by the Internet have been driven by consumer choice in both devices and applications. The steps taken today will not only protect consumer choice, but defend certainty for innovators to continue to deliver new services and apps without fear of being blocked.”

Can't restrict service

Specifically, the rules say licensees offering service on C Block spectrum “shall not deny, limit, or restrict the ability of their customers to use the devices and applications of their choice on the licensee’s C Block network,” subject to narrow exceptions.

“This case was the first of its kind in enforcing the pro-consumer open access obligations of the C Block rules,” said P. Michele Ellison, the FCC's Enforcement Bureau chief. “It underscores the agency’s commitment to guarantee consumers the benefits of an open wireless broadband platform by providing greater consumer choice and fostering innovation.”

At one time Verizon Wireless charged customers an extra $30 a month for a tethering package that included 5GB of data. It recently switched to a “shared data” system in which a customer may have multiple devices on one account that shares a pool of data.

But Verizon Wireless still charges a fee of $20 a month for the USB modem device that allows a laptop to access the Internet. Since Verizon Wireless, as part of the agreement with the FCC, will notify app store operators it no longer objects to the downloading of a tethering app to customers on C Block spectrum, it appears users could employ the app to avoid paying the monthly charge.

Story provided by ConsumerAffairs.
Consumer Affairs

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