43 Comments

Summary:

The FCC has come to a settlement with Verizon Wireless that will allow customers of the nation’s largest wireless network to use tethering apps from the Android market, and thus circumvent the $20 monthly fee Verizon charges for using a phone as a mobile hot spot.

mobile-hotspot-android

Verizon customers will soon have the option of downloading Android apps that let them turn their phone into a mobile hotspot –apps that Verizon blocked initially because it didn’t want customers circumventing its $20 a month mobile hot spot fee. The FCC has determined that nation’s largest wireless carrier was in the wrong in this situation because it had purchased spectrum back in 2008 that required Verizon to allow open access to its network.

Thus Verizon has settled with the FCC and is offering a $1.25 million payment to the U.S. Treasury as a result of the FCC’s consent decree on this issue. The FCC also is saying that Verizon cannot charge customers on tiered data plans the $20 a month tethering fee, but it can charge it for those customers who are on an unlimited data plan. However, Verizon will not actually have a way to determine if customers are using one of these apps, so presumably any Android customer can download one of those apps and tether to their heart’s content.

Unfortunately for customers of AT&T, Sprint and T-Mobile, which also charge fees on some plans to use the handset as a hotspot, the FCC’s consent decree was based on Verizon’s purchase of 700 MHz spectrum that came with a mandate that Verizon let other devices and applications run on that spectrum. So Verizon now has to notify Google that customers of Verizon Wireless can now access tethering apps such as Wireless Tether or PDANet, which has 6 million downloads.

Here’s the basics of the settlement according to the FCC’s release:

Under the terms of today’s settlement, Verizon Wireless will make a voluntary payment to the Treasury in the amount of $1.25 million, and has committed to notifying the application store operator 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 implement a compliance plan, requiring
that:

  1. employees will receive training on compliance with the C Block rules;
  2. future communications with application store operators regarding the availability of applications to Verizon Wireless customers will be reviewed in advance by legal counsel; and
  3. Verizon will report any instances of noncompliance with the rule at issue that might occur during the two-year term of the plan.

In addition, the company recently revised its service offerings such that consumers on usage-based pricing plans may tether, using any application, without paying an additional fee.

  1. But does this mean Apple will let tethering apps be installed on the iphone?

    I’m guessing not.

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    1. I’m sure there is no way for a 3rd party app to do what it needs to allow tethering on the sandboxed iPhone.

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      1. I’m sure you are wrong which you would know if you took the simple step of typing “iphone tethering” into Google.

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      2. Really, Idon’t know? Point me to a way to tether a non-jailbroken iPhone.

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    2. jailbreak? there are plenty of options in the jailbreak community.

      this is interesting, because i don’t think apple really cares one way or the other in regards to tethering; the fees are a cash cow for the mobile providers. same as sms fees.

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    3. The current Verizon iPhone does not run on 4G LTE using the 700Mhz band this applies to, so it would have no implications for Apple or the iPhone.

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      1. the agreement did not limit the open access to just the 700 Mhz band,VZ agreed to apply it to their entire network. They lied about that, and the penalty was only $1.25M, far less than the revenu they generated from charging people for using tethering.

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      2. But the LTE iPad does and allows tethering at no additional fee. Maybe Verizon saw this coming. I’m betting the LTE iPhone will also have free tethering.

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      3. I think the current fee is a tablet vs. phone thing, rather than a LTE vs. 3G thing.
        I have a 3G Galaxy Tab, and there’s no charge for tethering, just like the iPad. I believe the tethering fee has only been for phones.
        As keninca said, they aren’t supposed to charge a fee to anyone.

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  2. Thomas J. Romano Tuesday, July 31, 2012

    Lets see if all of a sudden the unlimited plan shows up again.

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    1. It wont

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      1. It doesn’t matter – Verizon’s new shared data plans will make this moot.

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      2. agree! If you are on a 2 gb data plan (which is the same cost as the old unlimited, 30.00) you will soon figure out that they are designed to generate overages. They sell you a smart phone and force a data plan (that imo is greatly over priced) on you that basically chokes off your device unless you are prepared to pay thgough the nose of more.It doesn’t allow you to do much more than download emails and some texting and light webserfing. If you dare watch a movie, or even a Netflex tv show be prepared to pay a little extra next month. (A full HD movie could cost you $10 or $20 in data overages easily. With the 2gb limit you are going to pay for just about anything you do that is more than basic internet usage. They give you just enough to hang yourself.

        I used half my data by accident already this month. I copied a 750mg file from my networked pc to the phone, thinking I was on wifi. Guess what? I was on LTE. The good news is it was so fast I didn’t notice it wasn’t wifi :-) :-( but now I have to really watch data for the next 11 days or pay more. Limited Data SUXS!

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  3. $1.25 Million sounds like peanuts.

    Also, let’s not forget that it was Google which played a key role in ensuring that Verizon agreed to those open access provisions before it was able to gobble up the spectrum during the 2008 auction.

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  4. people, ive tethered on iphone and android for years using EasyTether. never had a problem and no one has stopped me

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    1. Please tell me how to do this!!! I’m so confused. I’ve tried to tether fro my iPhone to iPad and it keeps tellingly to contact Verizon and they still tell me it is a $20ontjly fee. Ease help me!!!!

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  5. The FCC mentions devices. Makes you wonder if unlocked bootloaders are next. I know the FCC got a ton of complaints on bootloaders using the spectrum argument this winter.

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  6. Pretty sure hotspot is in Settings for iPhone.

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  7. An argument can be made that tethering consumes more network resources for the same number of bits due to the streaming video and similar content that is more challenging to deliver, and thus it costs more for the operator, but I don’t know if that argument ever got to Verizon’s lawyers.

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    1. I think they would have a real hard time arguing they can’t deliver data when they will happily sell you more the second you go over your limit, and they already charge 15.00 a GB. That is pretty damn expensive data! Compare that to home access cost and its outrageous. Imagine if you had to pay 15 bucks per.. gb at home or the office.!!
      I went from a 30.00 for unlimited plan to 30.00 for 2gb, THAT IS ONE HECK OF A PRICE INCREASE!

      I have also read some stories that this may in fact get some phones boot loaders unlocked. Hoping one is the s3 although it doesn’t really matter as the phone is already basically hacked and can run anything the Dev’s want to put on the phone.

      Also how does tether use more “Network Resources”, tethered data is just data. If that was a problem for them they could just turn you off when you go over but instead the sell you more data.

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  8. Simon Weaver Tuesday, July 31, 2012

    but surely it’s still in some way against their TOS to tether (or theyre desperately finding some loophole to make it so)
    or can I now take my unlimited plan and $20 for unlimited tethering. I’m completely confused

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  9. The FCC ruling should have extended over to Sprint, AT&T, & T-Mobile, but unfortunately it didn’t. It would have been nice.

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    1. Hopefully, if the big dog (Verizon) has stopped charging for tethering, the others will follow suit to be competitiive. Are you listening, T-Mobile?

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      1. yeah they’ll act like its was all their idea, for the good of the customer of course, and turn it into a marketing gimmick

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  10. Question to the author – why does this only affect Android handsets? Wouldn’t iOS and WP7 devices also be impacted?

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