All Things D: The FCC’s Chairman and Verizon Wireless’s CEO On Broadband Speeds and Net Neutrality
Lowell McAdam, CEO of Verizon Wireless and The FCC Chairman, Kevin Martin are on stage at All Things D. And in an instant, Mossberg is ON KEVIN’S ASS for the US’s slow, expensive broadband! “You’re the chairman of the FCC, how did you allow this to happen?”
Kevin basically responds that there isn’t enough subsidation in the US.
Mossberg moves onto openness of the networks.
Kevin Martin is saying that both consumers and entrepreneurs both want it. So in the last auction, they put a condition in that the spectrum needs to be open to any handset or application. And our willingness to embrace that is important. We’re not completely there yet, so that every major carrier is embracing openness.
Kara: Would you have done this openness thing before Google spoke up?
Verizon: You see in Japan and Korea that what networks can do when open. But in the past, customers wanted to do things like downloading apps to their phones. And that increased as the broadband speeds picked up.
If someone builds a device that isn’t efficient, or uses too much bandwidth, we have to be careful. The shared resource [of the wireless network] is not like a DSL line. (Funny, isn’t that what the net neutrality enemies are saying is a shared resource, too? B.L.)
Mossberg: Will rates be the same for plans using phones that we didn’t buy from you?
Lowell: They will be the same, but the functionalities might be different, because of your handset. (Obviously —B.L.)
Mossberg: So you’re purely a provider of network services then?
Lowell: Yes.
Mossberg: Let’s talk about cancellation fees. How to you justify charging people $175-$200 to cancel plans that have already worked through their subsidation.
Lowell: We don’t do that anymore, as of a year ago. In Italy, they don’t allow subsidization for these reasons. We tier our termination fees so that over time they get lower. And we sell all our phones without any subsidies as an option but 98% of the people choose the contract. If subsidies were outlawed, we’d have no problem and no other carriers would, too.
Kevin: It should be declined over time if its a recovering fixed cost. There should be a reasonable amount of time to take your phone/service home and try it out. There’s a 14-day allowance for this. Some people are wondering what restocking fees should be, too.
