AT&T, Verizon Under Investigation Over Alleged eSIM Collusion

DOJ investigating AT&T and Verizon for collusion
Report: DOJ investigating AT&T, Verizon over possible collusion

22 April, 2018

The Times is reporting that the agency's antitrust division has contacted the groups about whether the wireless carriers tried to deter a new technology known as eSIM, which would allow consumers to switch providers without using a SIM card.

Officials requested in February that the three entities facing investigation turn over information related to purported efforts to undermine eSim, a technology that allows consumers to switch their phone numbers from one carrier to another easily.

AT&T and Verizon are being accused of colluding with the G.S.M.A to try and establish a method that would allow them to lock a particular device to a carrier even if it's using the eSIM technology.

Representatives from Verizon Wireless and AT&T acknowledged the inquiry by the Justice Department, with a Verizon spokesman telling the NYTimes that the issue was "much ado about nothing". Other companies have since voiced similar concerns, the report said.

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"We are aware of the investigation into GSMA's process for developing eSIM standards that provide a better experience for consumers", AT&T said.

AT&T also indicated it was they are working with the Justice Department. The Justice Department says its merger will hurt competition and lead to higher prices for customers. It's something supported by companies like Apple, Google and Microsoft, and has already been integrated to some degree in some smart watches.

News of the probe comes at a critical time for AT&T which is being sued by the Justice Department to stop its deal to buy media company Time Warner Inc (TWX.N). The newspaper cites six people with knowledge of the inquiry and alleges the wireless carriers worked in coordination to make it more hard for people to switch carriers. The investigation may also include other major American carriers, another person said.

In a private meeting this year of a task force called GSMA North America, AT&T and Verizon pushed for the ability to lock phones to their networks, bypassing the objective of eSIM technology, said Harold Feld, a senior vice president of Public Knowledge, a nonprofit consumer group, who was briefed on the meeting. Verizon had previously stated that it needed to be able lock down phones as a way to prevent fraud and theft.

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