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Chuck Blasts Big Apple Service

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LR Mobile News Analysis
Light Reading
11/28/2002
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Senator Chuck Schumer's call for a drastic improvement in cellphone services in New York City -– America's largest wireless market -– may have caused some consternation for carriers, but it had certain equipment providers licking their lips in glee.

Senator Chuck's assertion that the service received by the Big Apple's 10 million-plus mobile phone users "is the worst in the entire country" was backed by a list of nearly 200 "dead zones" in the city and a letter to Federal Communications Commission (FCC) chairman Michael Powell.

The letter lays out a five point plan for improving coverage and service. Schumer wants operators and the FCC to work together to provide prospective cellphone buyers with a more extensive description of the sort of coverage they can expect to receive and a map of the dead zones before they get locked into a contract.

"The only way to increase competition and provide incentives for these companies to improve service is to increase the flow of information," Schumer says in a statement. "Consumers should know as much as possible about what they are spending their hard-earned dollars on. And if the service turns out to be sub-par, there shouldn't be any barriers to switching providers."

Schumer also calls for the FCC to work with the carriers on the thorny issues of number portability and charges for calls that don't get connected or are dropped in mid-conversation. Number portability – the ability to keep the same phone number when you change providers – is seen as key to allowing consumers the greatest flexibility when choosing operators. However, it’s a headache the operators don't really want. Schumer chastised the FCC for repeatedly extending the carriers' deadline for implementing number portability. The current deadline is November 24, 2003.

However, the real reason Schumer's plan gives vendors cause to cheer is his call for operators to actually upgrade their networks. Rather than build up their internal infrastructures to support this huge number of customers, cell phone companies have aggressively marketed a system that is flawed and inadequate for the number of subscribers it needs to support, Schumer says. Almost all cellular networks can only handle 25 to 30 percent of their customers making a phone call at any one time, and the FCC does not currently put specific requirements on network quality or capacity.

Schumer calls for operators to focus on improving in-building coverage and asks why New York State, which has collected a $1.20 911 compatibility monthly fee from every cell phone subscriber's bill during the past 10 years, has not used the money to create a functioning location-detection network.

All of this was music to the ears of LM Ericsson (Nasdaq: ERICD) CEO and president Kurt Hellstrom (see Ericsson's CDMA Dreams). "We need more senators like him," he quipped when asked about the Senator's plan at the Swedish's company technology bash in New York on Monday.

However, it's not clear at the moment, what affect – if any – Schumer's name-and-shame dead zone campaign will have on the carriers.

On a personal note, I should add that I live in one of dead zones named by Schumer, and I don't actually find the service there too bad. However, our offices are in the Tribeca area of NYC and it is no surprise to see all the dead spots named around this area. I constantly get dropped calls in this part of town, and I've tried various different providers. The service is, quite frankly, appalling.

— Dan Jones, Senior Editor, Unstrung www.unstrung.com

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