GSMA too good at representing interests of telco members, finds US Justice Dept

Nick Wood
By Nick Wood

Nov 29, 2019

© Flickr/cc-licence/Luciano Belviso

© Flickr/cc-licence/Luciano Belviso

  • Telco industry group in non-shocker: it favoured telcos when setting eSIM standard
  • It has agreed to include more input from its non-operator members...
  • ...Which is sensible given how unpredictable the US government is these days

The GSMA has agreed to tweak its standard-setting procedures to better incorporate views from non-operator members, after the US Justice Department found that it favoured telcos when drawing up eSIM standards.

That's right: a telco lobby group got into hot water for doing too thorough a job of representing the interests of telcos.

In the case of eSIM, the DoJ said that following a two-year investigation, it concluded that "the GSMA and its mobile network operator members used an unbalanced standard-setting process, with procedures that stacked the deck in their favour, to enact an RSP Specification that included provisions designed to limit competition among networks."

It is easy to see why operators would do this. With eSIM, it becomes easier to switch networks since no physical SIM card is required, paving the way for greater competition.

In response to the DoJ's review, the GSMA has drafted new procedures that incorporate more input from non-operator members, which the US watchdog says will result in a greater likelihood of pro-competitive benefits for end users.

The end result of all this is that the DoJ has sent to the GSMA what is known as a Business Review Letter, which sets out its concerns over past practices and accepts the remedies volunteered by the GSMA. It means that the industry group or its operator members won't face any enforcement action.

"I am pleased that the GSMA is ready to use its standard-setting process to create a more consumer-friendly eSIM standard," said assistant attorney general Makan Delrahim. "The GSMA's old procedures resulted in certain eSIMs rules that benefited only its incumbent mobile network operators at the risk of innovation and American consumers. The new procedures proposed going forward significantly reduce that risk and should result in new innovative offerings for consumers."

Don't poke the bear

In response, the GSMA was keen to point out that its standards are voluntary and based on industry consensus, and besides, the DoJ found no violation of any antitrust law, so there.

"The Justice Department reviewed millions of documents covering a multi-year and complex process to establish common standards for eSIM technologies. Its Business Review Letter is conclusive that the agency found no violation of antitrust laws," the GSMA said.

Nonetheless, it is in the GSMA's interest to tread carefully when it comes to this decidedly erratic US administration.

The last thing it needs is for the US to throw its toys out of the pram and refuse to endorse technology standards that have been agreed upon by the rest of the world.

We've already seen the Department of Commerce (DoC) this week take a step closer to having the power to unilaterally block the import of IT and comms hardware sold by foreign companies deemed to represent a threat to US national security.

It's not too much of leap to consider that this White House might take extraordinarily bureaucratic measures to curb the influence of foreign companies on its home telecoms turf, even if ultimately its domestic players and its own consumers were the ones to lose out.

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