The FCC said Verizon Wireless (NYSE:VZ) will pay $1.25 million undr a consent decree and allow customers to download Android applications that allow them to turn their phones into mobile hotspots. The FCC found that Verizon was wrong to block access to such apps, which customers were using to get around Verizon's old $30 monthly mobile hotspot charge.
The issue arose because of the open-access conditions that were placed on Verizon's 700 MHz C-Block spectrum, in which it is deploying an LTE network that now covers 230 million people across the country. The rules state that Verizon "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. After complaints that Verizon was blocking tethering apps, the FCC launched an investigation. Verizon admitted no fault as part of the consent decree.
Reports from the spring of 2011, including in FierceBroadbandWireless, brought to light the fact that Verizon's Android smartphone customers were being blocked from downloading third-party tethering apps. At the time, Verizon claimed it did not block applications in the Android Market and that Google (NASDAQ:GOOG) was responsible for the management of the Android Market. However, a Google spokesman confirmed to FierceBroadbandWireless in May 2011 that Verizon and AT&T Mobility (NYSE:T) customers could not download a specific tethering application, Wireless Tether, from the Android Market.
Currently, under Verizon's new Share Everything shared data plans, mobile hotspot access is available for no additional fee.
"Today's action demonstrates that compliance with FCC obligations is not optional," FCC Chairman Julius Genachowski said in a statement. "The open device and application obligations were core conditions when Verizon purchased the C-block spectrum."
"We have made clear to our customers that when using our services, they can go where they want and do what they want on the Internet, using the lawful applications and devices of their choice," Verizon said in a statement. "Verizon Wireless has always allowed its customers to use the lawful applications of their choice on its networks, and it did not block its customers from using third-party tethering applications. This consent decree puts behind us concerns related to an employee's communication with an app store operator about tethering applications, and allows us to focus on serving our customers."
The FCC said Verizon has committed to notifying the application store operator--presumably Google--that it "no longer objects to the availability of the tethering applications to C-Block network customers in the operator's online market." Verizon Wireless has also agreed to ensure that its employees will receive training on compliance with the C-Block rules; that future communications with application store operators regarding the availability of applications to Verizon customers will be reviewed in advance by legal counsel; and that the carrier "will report any instances of noncompliance with the rule at issue that might occur during the two-year term of the plan."
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