The Future of Internet-based Phones in Europe

It has always been the easiest and most powerful way to break a regulation by using technology. Since the political process is full of so much rent-seeking, it is very hard to get a politician that wants to deregulate. He would have to have some other powerful interest group who probably but may not have perverse incentives for the deregulation.

Technology is also good at finding ways to make certain things more efficient. I overheard a conservation today talking about the quickly changing way on how you registered for classes. First, you stood in line and once you got up there you would grab a card that would represent your seat in that class. Second, he claimed that you used the phone and today you use the computer. This saved a lot of time and hassle.

When it comes to the technology of phones and cellular phones it is still costly to make international phone calls, but things like Skype and Vonage have made this much easier. They use internet instead of phone lines to make calls. They bridged the technology phone gap. Of course, cell phone companies do not want you to be able to do that and this would eliminate their international market. This from International Herald Tribune:

“European Union regulators are looking into whether mobile phone operators who block customers from making inexpensive wireless calls over the Internet are breaking competition rules.

The European Commission, the EU antitrust authority, has sent questionnaires to phone companies asking what “tools” they use to “control, manage, block, slow down or otherwise restrict or filter” Internet-based voice calls.

Some mobile carriers have blocked services that use voice-over-Internet protocol, or VoIP, which allows users to make calls over the Web. Companies may be seeking to stop customers from accessing applications, like eBay’s Skype, to defend voice revenue from the less expensive Internet services, Carolina Milanesi, research director for mobile devices at Gartner, the research company, said.”

Surprisingly, the European regulators are coming to the rescue of a industry that is efficiently beating another industry. Now I do not know all of the details of this and I do not know how the company is able to keep their customers from using these. I am just surprised the cell phone companies haven’t lobbied the EU to get these to be banned everywhere and the EU would go along with it.

We would expect without Europe meddling in the competitive market, some cell phone industry would come along and allow the users to access these services and then everyone would switch to this phone/internet industry. That would then force these companies to do the same.

~PCCapitalist

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Published in: on November 12, 2008 at 7:38 pm  Comments (1)  
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  1. […] here:  The Future of Internet-based Phones in Europe « The Public Choice … Continue reading » · Written on: 11-12-08 · No Comments […]


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