The US Department of Justice is investigating AT&T and Verizon for allegedly colluding with the GSMA to influence eSIM standards so as not to threaten their dominance over the US consumer market. EISM is allowing the consumers to opt for wireless providers without having the headache of inserting new physical sim cards or any such microchips.
"[There seems to be] a difference of opinion with a couple of phone equipment manufacturers regarding the development of eSIM standards". The department issued demands to the companies and the GSMA, a mobile industry standards group, for information on possible collusion, the report said.
The New York Times reported on Friday that the Justice Department had opened an investigation about five months ago after at least one device maker and one wireless carrier filed formal complaints with the Justice Department. One of its arguments is that a combined AT&T and Time Warner could work with other large players, like Comcast, which owns NBC Universal, to unfairly manipulate prices of cable channels owned by Time Warner. The reason? To prevent customers from leaving their services and switching to another carrier, in which eSIM tech makes it easier for them to do so. He said the issue was "much ado about nothing".
GSMA, a telecommunications standards organization, announced Saturday it is delaying implementation of a new cellphone technology in wake of the Justice Department's investigation of alleged coordination between the group, AT&T and Verizon Communications.
"We are aware of the investigation into GSMA's process for developing eSIM standards that provide a better experience for consumers", AT&T said.
In a private meeting this year of a task force called GSMA North America, AT&T and Verizon pushed for the ability to lock phones to their networks, bypassing the goal of eSIM technology, said Harold Feld, a senior vice president of Public Knowledge, a nonprofit consumer group, who was briefed on the meeting.
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AT&T and Verizon together control about 70 percent of all wireless subscriptions in the United States.
The US government has argued in a trial that is nearing completion that the proposed deal would spur AT&T to charge its pay TV rivals more for Time Warner content.
The report notes that the two carriers handle about 70% of U.S. wireless customers, and that the eSIM tech makes it easier to switch carriers.
All three carriers have confirmed the existence of this investigation.