Justice Department Probes U.S. Wireless Carriers' Work on SIM Card Alternative -- 3rd Update
April 20 2018 - 8:42PM
Dow Jones News
By Drew FitzGerald and Brent Kendall
The U.S. Department of Justice is investigating whether U.S.
wireless carriers and an industry trade group teamed up to make it
harder for cellphone subscribers to switch providers, according to
people familiar with the investigation.
The agency in February sent civil investigative demands to the
four major U.S. wireless carriers and the GSMA, an international
standards organization responsible for eSIM technology, the people
said. The eSIM standard lets wireless subscribers move their phone
number to a new carrier without having to remove a physical SIM
card.
The department for more than a year has had its eye on the issue
of SIM cards and phone portability, with a focus on the two largest
carriers, AT&T Inc. and Verizon Communications Inc., though the
February subpoenas represent a new stage of the inquiry, the people
said.
The department told the GSMA in an October 2016 letter that it
was closing its investigation, according to a copy reviewed by the
Journal. The letter warned the association that the government
might reopen the probe.
Spokesmen for the Justice Department and the London-based GSMA
declined to comment.
An AT&T spokesman said the company is aware of the
investigation and provided information to the government. A Verizon
spokesman said the company is cooperating with the probe.
"The reality is that we have a difference of opinion with a
couple of phone equipment manufacturers regarding the development
of e-SIM standards," Verizon spokesman Rich Young said. "Nothing
more."
News of the recent probe was first reported by the New York
Times.
Most mobile devices won't work without a SIM card -- subscriber
identity module -- that contains a customer's account information.
In the U.S., SIM cards tend to be usable only on the cellular
network of the carrier that issued it.
An eSIM, or embedded SIM, is typically a chip inside a device
that cannot be removed. It allows consumers to store multiple
carrier profiles on the same device and switch between their
networks, though only one can be used at a time.
The technology is already available on some consumer devices,
such as the Apple Watch Series 3, Samsung Gear S2 smartwatch and
Microsoft's Surface Pro LTE tablet.
One of the first smartphones released with embedded SIM
technology is the Google Pixel 2, which the Alphabet Inc. unit
started selling last year. It is testing the technology with its
Project Fi wireless service.
Apple Inc. has helped advance efforts to replace the traditional
SIM card. In 2014, it introduced an iPad with a built-in SIM card
that allowed users to turn their cellular data plans on or off or
switch between three of the four big U.S. providers. The iPad's
"soft SIM" sparked speculation that it might put similar technology
into its popular iPhones, but that has yet to happen.
"Apple's desperate for this technology to be there because they
want to make the phone smaller and thinner," said Kyle Wiens, chief
executive of iFixit, which tears down iPhones and writes an iPhone
repair manual.
He said that eliminating the SIM would create more space for a
larger battery or chips to boost performance. "The ideal phone
would have no buttons, no ports, nothing, so you know the SIM card
has to drive them crazy from a design perspective."
Apple declined to comment.
--Tripp Mickle contributed to this article.
Write to Drew FitzGerald at andrew.fitzgerald@wsj.com and Brent
Kendall at brent.kendall@wsj.com
(END) Dow Jones Newswires
April 20, 2018 20:27 ET (00:27 GMT)
Copyright (c) 2018 Dow Jones & Company, Inc.
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