A couple years ago, people were making a lot of noise about Finland’s announced plans to make broadband a universal right by July 1, 2010.

On schedule, last week, the same announcement received more coverage as the regulations went into effect. But not a lot of time has been spent analysing what really happened.

If you look at the details in the press release, you’ll see that FICORA (the regulator) has annointed 26 universal service operators in various regions of the country. In effect, a monopoly universal service provider has the obligation to provide certain services to any customer (consumer and business) for their region, in areas where the regulator has concerns about the competitive supply of services.

FICORA expects that 1Mbps broadband will be available for 30-40 Euros ($40-$53). It isn’t an overly onerous obligation. But the question remains as to whether this program serves to prevent competition from ever emerging in areas that provide subsidies to one provider. Would a portable user-subsidy be more effective at stimulating facilities based competition and having less of a distortionary effect on the market?

Such a program would also stimulate broadband adoption in urban areas among those who find regular broadband pricing a burden.

In the meantime, we are continuing to explore broadband becoming part of the definition of basic service for Canadians. Proceeding 2010-43 will have oral hearings beginning in late October. The file continues to accumulate, attracting many megabytes of data and argument.

An article on Wall Street Journal says that it is time for RIM and Nokia to join forces in order to compete more effectively against Apple in the smart phone segment.

Apple’s iPhone 4 scored sales of 1.7M units in its opening weekend, a new record for an Apple product launch.

The WSJ article highlights Apple’s market cap of $250B towering over the market valuations for Nokia and RIM, each roughly at $30B. The article suggests that Nokia has been unable to “formulate an answer for the iPhone at the high-end, and as smartphones get more affordable for consumers, the market for low-end phones will continue to shrink.” 

I wondered if the WSJ article may be discounting the importance of the developing world in its forecast for shrinking demand for low-end phones. It is often too easy to be focussed on our own markets without keeping the rest of world in mind.

Let’s provide a little context for these numbers. The total mobile handset market in first quarter 2010 was about 323 million units, or roughly 3.5M new handsets sold every day, for the entire quarter. So, on its launch weekend, the iPhone 4 took about 15% of worldwide sales. Nokia has seen sequential declines in quarterly market share, but it still sells more than a million devices every day – with roughly a third of the global market.

It is that global reach that provides an important distinction for low end devices. Less than 5% of Nokia’s revenues from sales of devices comes from North America [Nokia’s quarterly filings]. Three quarters of Nokia’s sales volume is from outside North America and Europe. About 80% of Nokia’s sales were low end devices with an average selling price of 39 EUR.

Integrating Windows functionality into the next generation of high end Nokia devices will provide an alternative other than RIM for Nokia to engage with the corporate market. 

A bigger question is where does RIM go from here?  

Lots of questions remain in the mobile device market. Will success in doing battle with Apple in the mobile device market parallel the computer market? Is it a case of religious debates, like Mac versus PC – Windows? Will Android be a more significant spoiler than Linux has been?

The Don’t Lock My Freedom website purports to represent consumer interests, when it is quite possible the net effect of its advocacy will be to raise initial phone prices and long term service costs. 

An article on Cartt.ca highlights these key flaws in the overly simplistic viewpoint that appears to have motivated the proposal to require wireless service providers to unlock phones.

The organizers of the website and the legislative supporters ignore the fact that there are already lots of alternate channels for people to buy phones without locks. There are service providers who have announced that they will unlock phones for their subscribers. Thanks to on-line third party sites like Tiger Direct, anyone who wants can buy unlocked phones, even if they aren’t in major metropolitan areas. Do a search for “unlock codes” and you will find lots of options at pretty low prices.

In other words, the marketplace is working without government intervention to dictate specific business models to the service providers. Now, I know that some will argue that most phones are being bought from the wireless service providers and have contracts associated with them. Maybe that is because people like the subsidies that they are receiving? Or they appreciate the ability to call the service providers’ technical support lines and have them recognize the model number and provide help.

Michael Geist is quoted in the Cartt.ca article saying:

In certain respects, this was an odd question to even have to ask. No one would ever question whether consumers have the right to tinker with their car or to use the same television if they switch providers from cable to satellite, yet the wireless industry somehow convinced the public that unlocking their phones – consumers’ own property – was wrong.

How many people who buy a Chevy expect a Mercedes dealer to fix their transmission for free? Or vice versa? Would a Ford dealer even be expected to be able to diagnose what is wrong with your Lambourgini? Is the next private member’s bill going to force car dealers to get rid of their oil change and service departments?

The metaphor for TVs just doesn’t hold up to scrutiny at all – unless Professor Geist has figured out a way to use his Bell TV set-top box for Rogers cable service, or vice versa. Maybe that is another private member’s bill.

If a phone that was sold by Rogers is unlocked and now is getting used on the TELUS network, which customer service line should the consumer call to find out how to load a Facebook application? When the TELUS representative has to spend extra time trying to learn the menu system for a model that was never sold by them, who should pay for that call?

How many consumers will be told to take their phones back to the original store for help with the software?

Should you be able to unlock a phone is a very different question from the government dictating a specific business model that requires all phones to be unlocked. The right to unlock phones is part of the copyright reform act, Bill C-32.

The Cellular Freedom Act appears to be naively motivated and could ultimately inconvenience most consumers.

CPAC’s on-demand service has added the June 9 keynote address by CWTA chief Bernard Lord from The 2010 Canadian Telecom Summit to its video on demand database.

This is the fourth session that is available from CPAC:

• The interview with CRTC Chairman Konrad von Finckenstein from the morning of June 8.
• The Regulatory Blockbuster, recorded on the morning of June 8, 2010
• Building Digital Canada from the end of the day on June 8.
• Keynote address by Bernard Lord, CEO of CWTA

Enjoy them.

Your comments are welcome.

Be sure to plan to attend The 2011 Canadian Telecom Summit: May 31-June 2, 2011 in Toronto.

Today, the British Medical Journal published a study that concluded “There is no association between risk of early childhood cancers and estimates of the mother’s exposure to mobile phone base stations during pregnancy.”

An accompanying editorial goes further, setting out a recommendation to physicians to reassure patients:

Meanwhile, clinicians should reassure patients not to worry about proximity to mobile phone masts. Moving away from a mast, with all its stresses and costs, cannot be justified on health grounds in the light of current evidence.

This is an important statement by a leading medical journal that directly challenges much of the junk science and hysteria that is being promoted by some who appear at community town hall meetings who lack any credentials in relevant medical, engineering or epidemiological fields.

So it was somewhat ironic that yesterday the city of San Francisco decided that the US, already suffering from 51 different telecom regulatory authorities, needed yet another level of telecommunications red tape. Its city council voted 11-1 to require mobile devices to be sold with a disclosure to consumers of the specific absorption rate (SAR).

It seems to me that there are already bodies at the federal level who have the responsibility to ensure consumer safety, and provide clear consumer labelling where appropriate.

San Francisco’s vote threatens to cause confusion in the marketplace and raise the cost of doing business by adding a third tier of regulation to an industry that is already hobbled by state regulation of intra-state communications and federal regulation of other matters. 

What is the relevance of a higher or lower SAR number? Is a lower number safer?

If the federal agencies aren’t doing their job, that is a different matter – but there is no evidence of failure by the national authorities.

One of the reasons that I enjoy watching World Cup soccer is that is provides such a wonderful metaphor for organizational excellence. Unlike the games we see at neighbourhood parks, players at the top tier don’t converge on the moving ball. The panoramic camera angles show the choreography as team members back away and trust their mates to defend or attack, pass and dance around the field. Players know their jobs and they know what the roles are for the other members of the team.

Government bodies, at all levels, need to know their own job and trust their team mates to do the same. You can’t perform at a world class level if you can’t get each player to understand this. The consumer labelling and information requirements of the San Francisco ordinance isn’t what troubles me; it is the dysfunctional balkanization of regulatory authority that the ordinance represents.

In the end, this additional level of red tape could be an inhibitor to world class performance of the US communications sector.