The use of “short codes” is one of the most recent innovations in wireless communications.
Short codes are five and six digit numbers through which a cell phone customer can interact with a variety of entertainment and informational sources, such as voting for an American Idol contestant, providing customer feedback on a candy bar, or even responding to direct marketing.
Unfortunately, short codes have been included in the latest effort to compel the Federal Communications Commission (FCC) to take a much greater involvement in the regulation of the communications marketplace.
The FCC’s current inquiry is in connection with a request for a ruling regarding “text messages and short codes.” The complaint challenges whether companies, via disclosed guidelines, may continue to have a wide degree of freedom over who uses short codes, what sorts of messages are included, and what consumers might pay to receive them on their cell phones.
The attempt is to use this issue as an excuse to expand regulatory control of the wireless industry. However, there is no compelling reason why the FCC should regulate text messaging or short codes.
The specific complaints that have been leveled in the petition have already been resolved or will likely be resolved by the market place as companies adjust, or become more proficient in their usage policies. This is a far preferable situation than regulation. Most such complaints are being addressed by the private sector, including carrier announcements that they will open up their networks to other devices and flat rate pricing for calls, text messaging and Internet connections.
But more importantly, regulation impedes the development of new products and services, and slows deployment to consumers. The history of regulatory forbearance on wireless service, at both the state and federal level, has been a primary factor in the rapid and affordable expansion of wireless service in the United States. Such forbearance has been and continues to be in the best interest of both consumers and providers.
Appropriately, most service providers have had some limitation on content for the carriage of short code services on their wireless networks. And certain types of short code content may violate what a company feels is proper for public dissemination or that is appropriate for their public image. Concerns about pornography and questionable messages getting into the hands of children should inform individual company policies.
The FCC certainly may review actions when a consumer complaint is asserted. And in a situation where “bad behavior” had taken place, even a review by the Commission provides an incentive for a service provider to change business practices. And in this case that is all that needs to be done – review the issues at hand but do not use it as an excuse to expand regulation to text messages.
Finally, the FCC should begin to distinguish between legitimate consumer complaints and complaints filed by activist groups with a larger regulatory agenda. The question is whether there is any evidence or firsthand complaint that consumers are actually being harmed, or whether activists are simply using a convenient issue to advocate for dramatically increased regulation of the wireless industry.