Why Do Some Politicians Want To Ban You From Putting New Software On A Prepaid Mobile Phone?

from the protecting-business-models? dept

Mon, Oct 26th 2009 8:38pm — Mike Masnick

The EFF points out that some prepaid mobile providers have apparently convinced some politicians to introduce a bill, The Wireless Prepaid Access Device Enforcement Act of 2009, that would ban buyers of prepaid mobile phones from installing their own software for the purpose of working on another network. Basically, this is a bill specifically to protect the business model of Tracfone, which sells subsidized phones assuming that the buyers will keep buying prepaid minutes from them. The problem is that this might just be a bad business model -- and once someone has bought a device, it should be theirs, and they should be free to do with it what they want. Congress shouldn't be protecting anyone's business model.

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Filed Under: business models, ownership, prepaid mobile
Companies: tracfone

34 Comments

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Anonymous Coward, 26 Oct 2009 @ 9:43pm

Counter-Terrorism?
Does this have anything to do with preventing people from installing software on phones that might be used to remotely detonate an IED?
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Anonymous Coward, 26 Oct 2009 @ 9:51pm

Re: Counter-Terrorism?
No need to install any software to accomplish that. And if keeping cell phones from being used as a remote detonation device it would be one of the dumbest ideas I have heard in awhile LOL

Terrorist1: Ok I have the bomb completed and I am ready to blow up the building we planned on taking out.

Terrorist2: Excellent how are we going to set it off?

Terrorist1: I am going to install some software on this prepaid phone and BOOM!

Terrorist2: We cant do that! It is illegal to install unauthorized software on a prepaid phone!

Terrorist1: Drats!! Foiled again!
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Treb Namsorg, 26 Oct 2009 @ 10:06pm

Uhh, Anonymous Coward, you don't need special software to detonate a bomb with a cell phone. That's not how that works.
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Treb Namsorg, 26 Oct 2009 @ 10:07pm

Uhh, Anonymous Coward, you don't need special software to detonate a bomb with a cell phone. That's not how that works.
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Doctor Strange, 26 Oct 2009 @ 10:39pm

Well, it is sort of silly in its specificity, isn't it? And I don't understand why this has to be a crime, when the action seems more tortious than criminal.

Congress shouldn't be protecting anyone's business model.

Correct me if I'm wrong, but doesn't Congress protect everyone's business model? I mean, most business models are based on some sort of implicit or explicit contract, and those contracts are enforced by laws that are written and maintained by Congress (I'm sure some of them go back to Common Law).

I don't see why this business model needs its own special law, when a contract would do just as well. Perhaps some company that wants to operate loss-leader business models should have people sign a short contract at the register when purchasing one of these devices. I imagine that would cut into sales a little, but if this bulk-buying-reflashing-and-reselling business is so big it might make sense.

I've never really liked loss-leader business models myself, because instead of competing on socially-valuable things, like better product quality or lower price, you're competing on socially-malicious things, like who is capable of more artfully tricking consumers into spending more money than they think they are, or who is capable of better exploiting people's inability to perfectly predict their own future behavior.
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Pjerky (profile), 26 Oct 2009 @ 10:54pm

Re: Counter-Terrorism?
Actually it is very simple, it involves hooking up the bomb to the phone ringer. Call the phone from another phone and boom, the bomb goes off. Simple, easy, and can be detonated from anywhere on the planet.

Plus since when did silly things like laws stop criminals and terrorists?
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Anonymous Coward, 26 Oct 2009 @ 11:54pm

Re: Counter-Terrorism?
Does this have anything to do with preventing people from installing software on phones that might be used to remotely detonate an IED?

No. Even the suggestion is idiotic. Congratulations.
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Anonymous Coward, 27 Oct 2009 @ 12:03am

The Motor Fuel Access Device Enforcement Act
Maybe the auto industry needs a "Motor Fuel Access Device Enforcement Act" to make it illegal to use a motor vehicle to "access fuel" from any station not associated with the manufacturer. Yeah, that's the ticket.
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thornintheside, 27 Oct 2009 @ 12:53am

Isn't that the purpose of elected representatives?
Isn't that their job to make laws based upon the interests of the companies that supported their election campaign? Tell me one Senator or Congressman that hasn't put in similar laws to protect some business within their area - again, isn't this how it works in the USA?
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Daemon_ZOGG (profile), 27 Oct 2009 @ 1:26am

I'll do as I please..
Once I have the phone, I'll "mod" it as I see fit. And policing something like what their suggesting? It's a pre-paid phone! Pay cash. Alter the ESN if you must. Switch networks. Enjoy. ;)
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Luci, 27 Oct 2009 @ 1:41am

Would this stand up?
I buy the phone. The phone is totally legal, and it's mine. Not under a lease or contract, but mine. The software is legal. Putting one onto the other is suddenly illegal? Go ahead, take me to court for it. I cannot see how this would stand up in court at all.
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twilson (profile), 27 Oct 2009 @ 4:00am

Re: Would this stand up?
Well, firstly, if you buy a SUBSIDIZED handset, it isn't technically 100% yours. As until the subsidy has been paid off, part of the handset actually belongs to the operator your purchased it from.
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Anonymous Coward, 27 Oct 2009 @ 4:21am

Re: Re: Would this stand up?
Sorry, but no. Just because they decided to take a loss on the price of the phone in the belief that I would buy more minutes, does not mean they own any part of the phone.
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Anonymous Coward, 27 Oct 2009 @ 5:42am

Re:
So there isn't a contract. You get the phone cheap and go elsewhere. Suddenly it's a bad business model. Rather than adjust (in this case, probably go out of business), you simply pursue litigation.

And you are right, I can't think of a single reason that consumers should keep their rights if it means Tracfone will go out of business. Can you? Why not just pass a law that gives tax money to Tracfone?
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chris (profile), 27 Oct 2009 @ 6:21am

Re: Counter-Terrorism?
Does this have anything to do with preventing people from installing software on phones that might be used to remotely detonate an IED?

1) you don't use phones as detonators. you use them as triggers. phones don't generate enough electricity to detonate anything. you use a power source like a battery to blow a smaller explosive (like a blasting cap), called a primer. all the trigger does is complete the circuit between the battery and the primer.

2) any device with a vibrate function can be used as a trigger, including a pager or a sex toy.

3) you don't need any software to set up a phone as a trigger. you just cut the wire from the phone to the vibrate-motor and solder it to a switch. the phone "rings", switch closes the circuit, and (hopefully) it goes boom.

4) techdirt now supports terrorism.
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Anonymous Coward, 27 Oct 2009 @ 6:24am

"Congress shouldn't be protecting anyone's business model." Are you sure I thought that was the whole point of existence for Congress.

It is the American way blame others for everything and sue them. If that fails change the laws so you can succeed.
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Dark Helmet (profile), 27 Oct 2009 @ 6:26am

You know...
I really like the stories that include polling data on what the people, or constituents, want. Particularly when it comes to stories about government. But it got me thinking...

Given internet connectivity is relatively complete in this country (what is it, like 85% of people have access to the internet one way or another? Going off of memory in a news story there, so might be off...), why can't an independent, trusted group make a point to catalogue controversial legislation and go out and do a properly inclusive poll of registered voters that are effected by the bill, and just get their vote?

That way, if you have a bill like The Wireless Prepaid Access Device Enforcement Act of 2009 and 90% of the constituents don't want it, the group can flat out come out and say, "We have confirmed with a fair amount of accuracy that Senator Moneytaker has no interest in representing his constituents".

In fact, you could have a running list of each Senator/Representative and how many times and on what bills they blatantly ignored the will of the people. That way, when they're up for reelection, you go to the site, type in their name and then vote for the other guy should it be warranted.

Crowd source it locally with some general national guidelines. Hell, it doesn't even have to LOOK pretty; make it look simple like Craig's List. Except it can be called Dark Helmet's Shit List.

Dark Helmet WANT'S YOU! When do you want to start?
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chris (profile), 27 Oct 2009 @ 6:27am

did the unlock exception for the DMCA expire?
i thought that in 2006 there was an exception in the DMCA for unlocking phones. was that removed or expired?
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chris (profile), 27 Oct 2009 @ 6:51am

Re: Re: Would this stand up?
Well, firstly, if you buy a SUBSIDIZED handset, it isn't technically 100% yours. As until the subsidy has been paid off, part of the handset actually belongs to the operator your purchased it from.

it can't be subsidized *that* much, otherwise, kids in the drug trade would have put them out of business years ago by burning phones.
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John Fenderson (profile), 27 Oct 2009 @ 7:54am

Re: Re: Would this stand up?
Of course it is. I didn't sign (or even implicitly agree to) any contract that says otherwise. I just bought a really cheap phone that happens to be locked to a particular carrier.
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n00b, 27 Oct 2009 @ 8:07am

Wow...it's possible to do this?
Thanks for letting me know this was even possible dumbass politicians, now I'm gonna have to hunt around until I find out more about this kind of thing... That streisand effect is a real bitch, ain't it?
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Derek Kerton (profile), 27 Oct 2009 @ 8:25am

Re:
Or how can we serve customers who don't have the funds to purchase a phone outright, but want to join the 21st century nonetheless.

Loss leaders aren't malicious in and of themselves. It depends on whether the user is subsequently gouged because the seller has some kind of lock-in.
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Derek Kerton (profile), 27 Oct 2009 @ 8:35am

Re: Re: Would this stand up?
Whether a carrier subsidizes a phone or not is irrelevant to phone ownership. When you go to a carrier store, you "buy" the phone. If they sell it at profit or loss, that's their choice.

The only way for a carrier to claim different would be if the contract said something to the effect of "the phone remains the property of AT&T, and you must return it upon request". That sort of language exists for things like credit cards, FastPass toll RFIDs, and used to exist for landline phones.

Your suggestion is wrong. The phone is a loss leader, which under their business model they hope will generate positive returns in the long run. What if a Walmart offered "door crasher" specials for Thanksgiving, but said "Those remain our property unless you spend another $200 in the store." What if Walmart then asked congress to pass a law that said, "Nobody can come to our store on thanksgiving and only buy the door crasher items, but not also buy other regular priced items." Well, that's what TracFone wants.
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Derek Kerton (profile), 27 Oct 2009 @ 8:40am

Free Consulting
In my business, I give away a lot of free consulting. Over lunches, at conferences, in presentations, on blogs, etc, etc. The free advice costs me time, effort, and hard cash if I need to travel to a meeting. It starts as a loss, but I do it in the hopes that I will interest some potential customers in hiring me.

But you know what happens? Not everybody to whom I offer free consulting ends up hiring me and making me money.

I am going to ask congress to pass a law that says anyone to whom I give free consulting MUST then hire me for at least 2 hours of paid consulting. MY BUSINESS MODEL MUST BE PROTECTED. God (and congress) forbid I should suffer a loss, invest and suffer my own risks, or fail to make money on EVERY single loss leader I incur.
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nasch (profile), 27 Oct 2009 @ 9:08am

Re:
I think Tracfone is scared to force people to sign contracts, because many of their customers are exactly the people who don't want to sign cell phone contracts.

When I bought mine, the salesperson informed me that the phone is not for resale. I was OK with saying that I understand they don't intend it for resale, because that isn't the same as agreeing not to resell it. :-) At that time (about 2 years ago) they didn't say anything about trying to use it on another network, perhaps that issue hadn't come up yet.
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Alan Gerow (profile), 27 Oct 2009 @ 10:53am

Re: Isn't that the purpose of elected representatives?
What elected representatives do, and they're purpose is are not the same thing.

Purpose: It's their job to make laws based upon the interests of their citizen constituents.

Do: They ignore their citizen constituents when they can and make laws based upon the interests of the companies that supported their election campaign and current prostitute and/or prescription drug problems.
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Alan Gerow (profile), 27 Oct 2009 @ 10:58am

Re: Re: Would this stand up?
If you don't sign a contract, give money, get handed a phone, then the phone is yours regardless of what the person who is taking a loss WANTS to happen. And any restrictions placed on it are requests, not legal obligations.

If there's a contract in place that states that by receiving the merchandise you agree to "blah blah blah legalese" and then you SIGN that agreement, then you are bound by the agreement. Like in a auto lease agreement, the bank owns the car, you get to use it, but there's a contractual agreement signed by both parties that spells this out.

No agreement, then the phone is yours. Possession … 9/10ths and all.
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Anonymous Coward, 27 Oct 2009 @ 11:21am

Re: Re: Would this stand up?
Well, firstly, if you buy a SUBSIDIZED handset, it isn't technically 100% yours. As until the subsidy has been paid off, part of the handset actually belongs to the operator your purchased it from.

Can you cite US law to back that up or are you just making crap up?
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Anonymous Coward, 27 Oct 2009 @ 11:27am

Re: Re: Isn't that the purpose of elected representatives?
Purpose: It's their job to make laws based upon the interests of their citizen constituents.

Like many people, you seem to believe that their *stated* purpose is their *true* purpose. It isn't. If you want to know their true purpose, look at what they do, not what they say.
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lulz, 27 Oct 2009 @ 11:34am

Re: Re: Counter-Terrorism?
calm down bud. No need to be an asshole.
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SmartAssWhizKidd, 27 Oct 2009 @ 11:52am

Re:
you can say that again.
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Anonymous Coward, 27 Oct 2009 @ 6:41pm

Re: Re: Re: Counter-Terrorism?
"calm down bud. No need to be an asshole."

There's no need to start using profanity and calling people names either.
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freeman, 7 Nov 2009 @ 6:15pm

Re: Re: Re: Would this stand up?
Have they(perpaid) ever stated how much $ it has been subsidized for? How long one needs to buy minutes to overcome that subsidy.
The regular post paid has price and time limit well stated when subsidy will be paid off. why those prepaids can't do that.
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ben, 22 Jan 2010 @ 9:03am

Politicians are bought by lobyists, thats why they do it.
There is always two sides to the story. One side wants to criminalize unlocking activity, the other side wants to make the activity legal. Learn more about proposed govt regulations for unlocking at StopTrac.com
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