In Attacking Tethering, Verizon Isn’t Playing by the Rules

In pushing to remove access to tethering applications on some phones, Verizon Wireless may be violating openness rules attached to spectrum licenses that the company purchased in 2008. But weeks later, federal regulators have still not ruled on the alleged violation or taken action against the cell phone company.

When the federal government auctioned off spectrum freed up during the switch to digital television, the winner of the “C block” of nationwide spectrum were required, along with other mandates, to not “deny, limit, or restrict the ability of their customers to use the devices and applications of their choice” (link opens PDF). In that auction, Verizon paid approximately $4.7 billion for exclusive rights to “C block” spectrum for the 48 contiguous states to help it deploy a 4G LTE network.

In a legal complaint filed with the Federal Communications Commission last month, Free Press argues that, by blocking tethering, Verizon is not only interfering with a free choice of applications but also preventing its customers from using their cellular connections with devices of their choice.

Tethering refers to the act of sharing a cell phone's Internet connection with other devices—in essence, turning the phone into a wireless router that laptops, tablets, and other gadgets can use to get online when Wi-Fi or wired connections are unavailable. Numerous applications in Google's Android marketplace, including some that are free, offer users the ability to tether their phones. But in May, several news outlets began reporting that Google had removed tethering applications in the Android marketplace from some Verizon phones, apparently at the request of Verizon.

So far, tethering applications have not been stopped completely; savvy users can get around the restrictions by “sideloading” the applications directly on to their phones. But sideloading is too complex and cumbersome for many users, Free Press argues, and requires ignoring messages about security and privacy. Pop-up messages in the Android market also imply that the applications are not compatible with cell phones, instead of simply being inaccessible, driving away users from considering these tethering applications.

Since 2008, Verizon has challenged the openness requirements several times, but thus far has not been able to prevail.  But its monetary incentives for blocking tethering are fairly obvious; like other cell companies, it charges a hefty monthly fee to users for the right to tether. Wireless companies also argue that tethering leads to excessive bandwidth use. The C block rules do not make an exception for this purpose, however, and in fact it was for this “precise reason that the Commission adopted the C Block Rules” in the first place, Free Press writes.

Google’s role in the tethering matter remains unclear. Google was an active supporter of the openness conditions; when the FCC began auctioning off the 700 MHz frequency band—which previously held upper television channels—Google promised to bid at least $4.6 billion if openness conditions were attached to use of the airwaves. Google had no intention of winning the auction, but, as a content provider, wanted to ensure that wireless companies could not discriminate against particular types of data in favor of their own. Google was spared a billions-dollar payment when other bids surpassed its reserve price.

Although the tethering issue may seem to be limited in scope, it has significant implications for the continuing fight over net neutrality, especially as wireless devices become more common and data-hungry. One significant point of contention during the years-long net neutrality proceedings was the extent to which it might apply to wireless, as opposed to wired, broadband Internet connections.

Unfortunately, the FCC has not only been silent thus far on Verizon's actions, but has also designated the Free Press complaint “restricted,” limiting the ability for consumer groups and members of the general public to weigh in and threatening to remove the issue from the public spotlight. For some, this is a serious issue; Barbara van Schewick, a Stanford law professor, has petitioned the FCC to open up the proceedings, writing “the questions raised by the complaint are too important to be decided without public participation.” A more transparent approach to the tethering blocks is vital to ensuring that everyone who might be affected has a chance to be heard and raises confidence that public interest conditions will be treated seriously and thoroughly in the future.