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A bill was introduced in the Senate last week by Senators Byron Dorgan (D-N.D.) and Daniel Inouye (D-Hawaii) that would provide consumer protection in the mobile phone industry. It’s focus would be cracking down on fraudulent and anti-competitive behavior. But perhaps the most important aspect is that it would repeal the common carrier exception in the FTC statute. This means that the FTC would gain some oversight over the industry, and quash some deceptive practices, such as advertising. I wonder what would come of AT&T’s prepaid commercials.

I think FTC Chairman William Kovacic hits the essence of the issue:

“Technological advances have blurred the traditional boundaries between telecommunications, entertainment and high technology,” stated Kovacic in prepared testimony for a Senate Commerce Committee hearing last week. “As the telecommunications and Internet industries continue to converge, the common carrier exemption is likely to frustrate the FTC’s ability to stop deceptive and unfair acts and unfair practices and unfair methods of competition with respect to interconnected communications, information, entertainment and payment services.”

While this makes sense from a consumer standpoint, clearly the wireless carriers do not support such regulation — though they haven’t officially commented yet. So we’ll see how far this goes.

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