U.S. regulators on Thursday adopted data roaming rules that would allow smart phones to access the Internet in areas across the country not covered by their wireless carrier.
The rules set by the Federal Communications Commission in a 3-2 vote would force wireless carriers like AT&T Inc. and Verizon Wireless to offer "reasonable" roaming rates.
"Mobile providers must be able to offer nationwide voice and data plans to have any chance of competing in today's market," FCC Chairman Julius Genachowski said at the agency's meeting.
But evidence collected from wireless carriers "shows that roaming deals are simply not being widely offered on commercially reasonable terms," Genachowski added.
Sprint Nextel, MetroPCS Communications Inc. and other smaller carriers have lobbied for such rules to ensure they can reach roaming agreements vital to staying competitive as consumers want the ability to use their phones everywhere they go.
The FCC found that Verizon Wireless and AT&T had engaged in few data roaming agreements on their 3G networks, and declined to commit to reaching agreements on the new 4G LTE networks both are deploying.
AT&T's proposed $39-billion bid for Deutsche Telekom AG's T-Mobile USA would concentrate 80 per cent of U.S. wireless contract customers in just two companies - AT&T/T-Mobile and Verizon Wireless, a joint venture of Verizon Communications and Vodafone Group Plc.
"With AT&T's proposed acquisition of T-Mobile and the corresponding threat it poses to continued wireless competition, it is absolutely critical that the FCC take steps to promote competition and level the playing field," said Vonya McCann, Sprint's senior vice president of government affairs.
Smaller and rural carriers have pushed for data roaming rules to prevent the largest wireless carriers from shutting them out of nationwide broadband connectivity.
Republican Commissioners Robert McDowell and Meredith Attwell Baker voted against the measure, arguing that they believe the rules impose common carrier obligations.
Their Democrat counterparts disagreed.
"It's the opposite of common carriage because the framework relies on individualized, case-by-case market deals that will vary," Genachowski told reporters during a press conference after the open meeting.
Under the rules, wireless carriers would be free to negotiate the terms of the agreements, and could institute safeguards to prevent congestion or harm to their networks from roaming traffic.
Roaming negotiations that stall can be brought to the FCC for resolution on a case-by-case basis.
The FCC already mandates roaming for voice services so wireless customers can make calls when outside of their carrier's service area. The rules adopted on Thursday extend this measure to mobile data services given the boom in wireless devices such as Apple Inc's iPhone.