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Four reasons Verizon's smackdown of Google Wallet is bad for banks and consumers.
December 7
Verizon Wireless's decision to prevent Google from providing its Wallet mobile payment app on the new Galaxy Nexus smart phone, which came out yesterday, has not gone unnoticed in Washington. Free Press, a D.C.-based nonprofit organization whose mission is "to reform the media," has filed an official objection to the Federal Communications Commission, accusing the telecom company of breaking FCC rules and harming innovation.
Free Press says Verizon's move echoes earlier restrictions the company placed on third-party applications that allow phones to be used as mobile hot spots. In June 2011, Free Press filed a complaint with the FCC about Verizon's blocking practices, citing violations of the conditions placed on the airwaves on which Verizon operates its service.
Free Press believes that Verizon Wireless may be denying subscribers' access to third-party mobile payment applications because it is part of a joint venture to develop its own mobile payment technology, called Isis.
"It appears as though Verizon Wireless is abusing its power to act as a gatekeeper and blocking applications developed by competitors," says Free Press policy director Matt Wood. "If Verizon Wireless is restricting its subscribers from accessing such applications, it is breaking FCC rules and harming innovation in the process. The FCC cannot allow Verizon to continue to engage in these textbook examples of anti-competitive and anti-consumer behavior. It must enforce Verizon's existing license conditions and adopt real Net Neutrality rules that protect all wireless Internet users."
