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Communications Daily

The Foundation for Taxpayer & Consumer Rights filed a lawsuit in L.A. Superior Court charging wireless phones sold by T-Mobile, AT&T and Cingular contain software that prevents porting to other carriers. The suit charges this is a violation of Cal. consumer protection law.

Harvey Rosenfield, founder of the group, told us the suit has national implications and was filed in Cal. in part because the state has very aggressive consumer protection laws. “This is a national problem,” Rosenfeld said Tues.: “If we’re able to win in California we’ll be addressing this problem elsewhere because I don’t see companies making phones just for California.”

Rosenfeld said over the past few days he has been inundated with e-mails from companies that make software allowing consumers to “crack” the codes on their phones and port them to other carriers. “I don’t think consumers should have to go into back alleys and provide their credit card numbers to make their phones operational,” he said. Rosenfeld added that some carriers may be willing to voluntarily change the software. “Some carriers, once they see the handwriting on the wall, won’t want to bear the public attention,” he said.

Jordan Lurie, a lawyer for the foundation, said in a statement: “If you can use the same phone number with other carriers, you should be able to use the same phone. Pop out the SIM-chip, pop in a new SIM-chip. That’s how easy it should be to use your GSM phone with another carrier. Handset locking is just another unfair way to lock customers into their networks.”

Rosenfeld said the practice is one of several anti- competitive practices followed by wireless carriers: “Consumers are mad as hell about cell phone service. First of all, you can’t get access, you can’t make a call or you get disconnected in the middle of a call. Then there are the bogus fees and overcharges that nickel and dime us out of our money and the deliberately lousy customer service that prevents you from getting the bill fixed. If you try to walk away, they punish you with an ‘early termination fee.'”

Cingular said in a statement the practice is innocent. “Typically, all GSM carriers lock their phones,” the carrier said: “GSM devices can be unlocked if the former carrier is willing to provide the new carrier with the customer’s unlock code. Cingular will allow another GSM carrier’s phone to be activated on its network if the phone is unlocked or Cingular can unlock it. Cingular will
provide the unlock code to another carrier if the customer has fulfilled his/her contract and has no outstanding, unpaid bills.” Cingular also noted that the handsets it sells are optimized for Cingular‘s network: “We load special settings into our devices to support a variety of features including wireless Internet, content downloads (ring tones, graphics, games, etc.), instant messaging and multimedia messaging. If a handset from another carrier has the wrong settings, these features may not work properly.”

The suit is one of several pending against wireless carriers by the group. The foundation also has filed against Cingular alleging false advertising and against Nextel charging billing improprieties.

Consumer Watchdog
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