Two Landmark Settlements –
“A Berlin Wall Moment”

In 2007, LAW OFFICES OF SCOTT A. BURSOR negotiated and obtained court-approval of settlements in Nguyen v. Verizon Wireless and Zill v. Sprint Spectrum, which required Verizon Wireless and Sprint to change their handset locking practices and to open their wireless networks to third-party devices and applications. The Verizon settlement became effective in November 2007, and within two weeks thereafter Verizon announced that it would open its network to third-party devices and applications. The Sprint settlement is expected to be implemented in 2008. These settlements are believed to be the most significant legal development affecting the telecommunications industry since 1968, when the FCC’s Carterfone decision similarly opened up AT&T’s wireline telephone network.

Listed below are some of the comments and reactions political and industry leaders, as well as prominent telecommunications industry analysts, concerning the settlements and Verizon’s announcement that it would open its wireless network:

– "Judge Bonnie Sabraw of the California Superior Court on Monday signed a nationwide handset-locking settlement in connection with a class action suit against Sprint Nextel Corp., the second of two landmark settlements with national mobile phone carriers.”(1)

– Lowell McAdam, Verizon Wireless President and Chief Executive Officer:

––“This … goes beyond just a change in the design, delivery, purchase and provisioning of wireless devices and applications. This is a transformation point in the 20-year history of mass market wireless devices – one which we believe will set the table for the next level of innovation and growth.” (2)

–FCC Chairman Kevin Martin:

––“I was pleased to hear the announcement by Verizon …. [W]ireless customers should be able to use the wireless device of their choice and download whatever software they want onto it. I continue to believe that more openness – at the network, device, and application level – helps foster innovation and enhances consumers’ freedom and choice in purchasing wireless service. Today’s announcement … is a significant step toward fulfilling these goals. I am optimistic that Verizon Wireless’s commitment … will ensure an exciting new era in wireless technology for the benefit of all consumers.”(3)

– Representative Edward Markey (D-Mass.), House Telecommunications Subcommittee Chairman:

–– “In my view, greater openness will foster much-needed innovation and entrepreneurial activity. … [T]oday’s announcement is welcome news for wireless consumers and device and application developers as it indicates that a major wireless provider is moving in the direction of greater network openness and consumer choice.” (4)

– Representative John D. Dingell (D-Mich.), House Committee on Energy and Commerce Chairman:

–– “[T]he company’s decision appears to be a step forward for consumers. I’d like to see additional carriers listen to their customers and offer a more open platform.”(5)

– Eric Schmidt, Chairman and CEO of Google Inc.:

–– “We think this is a great step forward. As the Internet has demonstrated, open models create better services for consumers and stronger businesses for providers. We are excited to work with Verizon and other industry leaders to achieve this vision.” (6)

– Peter Knook, head of Microsoft’s mobile communications division:

–– “Microsoft is very excited to see Verizon Wireless make such a bold move to satisfy the demands of wireless customers.” (7)

– Jim Goldman, CNBC Silicon Valley Bureau Chief:

–– “There is enormous pressure for the rest of the industry to step up and respond to this, and this has the potential for being as big a deal for consumers as number portability.” (8)

– Harold Feld, Senior Vice President of the Media Access Project:

–– “We’re seeing a sea change here. If you go back a year ago, there was absolutely no sign anyone was interested in pushing open wireless networks. This is like a Berlin Wall moment, where the pressure is too much for these guys.” (9)

– Jack Gold, J. Gold Associates telecommunications analysts:

–– “This news is a big deal and sets a precedent for other U.S. carriers to follow.” (10)

– Jeffrey Kagan, telecommunications analyst:

–– “[The opening of Verizon’s wireless network] changes the entire direction that the cell phone industry has been on for the last 30 years. It’s the beginning of a customer-oriented marketplace, which until now has been carrier- and network-oriented.” (11)

– Vindu Goel, technology columnist, San Jose Mercury News:

–– “For years, the world has been urging U.S. wireless carriers to blow up the Berlin Wall surrounding their mobile-phone networks. Verizon Wireless, the nation’s second largest mobile-phone company, has bravely taken out the dynamite and lit the fuse.” (12)

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(1) Jeffrey Silva, “Skepticism Remains Over Verizon Wireless Open-Access Plans,” RCR Wireless News, (Nov. 28, 2007).

(2) 11/27/07 Verizon Wireless Press Release

(3) FCC Chairman Kevin Martin’s Statement On Verizon Wireless’s Plans To Introduce An “Any Apps, Any Device” Option For Consumers In 2008, (Nov. 27, 2007).

(4) Quoted in Jeffrey Silva, “Lawmakers, Google, Skype Applaud Verizon Wireless Decision, Others More Cautious,” RCR Wireless News, (Nov. 27, 2007).

(5) Quoted in David Lazarus, “Next Cell Trend Lets Users Hold The Phone,” Los Angeles Times (Nov. 28, 2007).

(6) Quoted in Jeffrey Silva, “Lawmakers, Google, Skype Applaud Verizon Wireless Decision, Others More Cautious,” RCR Wireless News, (Nov. 27, 2007).

(7) Quoted in Roger Cheng, “Verizon Wireless To Offer Open Access To Network,” The Wall Street Journal Online

(8) Jim Goldman, CNBC Silicon Valley Bureau Chief, “Verizon’s Open Access Network: Will Industry Follow?,” (Nov. 27, 2007).

(9) Ryan Kim, “Verizon Hears You Now,” San Francisco Chronicle (Nov. 27, 2007).

(10) Quoted in Matt Hamblen, “Verizon Wireless Changing Cellular Landscape, Analysts Say,” ComputerWorld, (Nov. 28, 2007).

(11) Quoted in id.

(12) Vindu Goel, “Vindu’s View: Verizon’s Catalyst To Innovation,” San Jose Mercury News (Nov. 28, 2007).