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January 12, 2010

MagicJack Uses Magic Spectrum Wand for Femtocell Service

MagicJack says it can provide GSM femtocells in the home without agreements with AT&T and T-Mobile: This is one of the most audacious and fascinating attempts to work around spectrum rules that I've seen since Vivato convinced the FCC to tweak the point-to-point power limit rules for phased-array devices.

MagicJack currently offers a VoIP service using a tiny plug-in device that costs $40, including a year's unlimited calls, and $20 for subsequent years. MagicJack pulls off this trick by being affiliated with a CLEC (competitive local exchange carrier), which allows it to benefit from call completion fees (paid by other carriers whose customers call MagicJack customers) and integration.

The femtocell MagicJack is altogether different. Using very low power, the femtocell will act as a GSM base station, and phones will connect to it to complete calls over a broadband Internet connection in the same way that the wireline adapter works.

The snag is that MagicJack doesn't have agreements with any US GSM providers, such as AT&T and T-Mobile, the two largest. Instead, it's asserting a couple of different doctrines of non-interference and, Kevin Werbach suggests, the constitutional right to be free from unreasonable searches and seizures.

MagicJack believes that by only using the femtocell in a home, and not interfering with carriers' outdoor networks, that there's no conflict with the FCC licenses that carriers have paid for. I first thought this was ridiculous, but now think there's a case to be made that could disrupt calling plans in the same way as T-Mobile's UMA handset service for unlimited domestic calls over Wi-Fi.

It's one thing for MagicJack to assert these rights, another to get FCC approval. IDG News Service reports that the FCC has no application yet and MagicJack confirms it hasn't submitted one. The FCC tests for certain kinds of rules compliance, and thus is unlikely to block device certification. However, carriers may file FCC complaints once the product is officially out to prevent its use and tie up the product for years under a restraining order or a similar mechanism.

It's a crazy idea, but also clever.


"The FCC tests for certain kinds of rules compliance, and thus is unlikely to block device certification."

Well ...

The wireless version of this product is said to operate on spectrum licensed to carriers, but is not for use by those licensees or under any chain of responsibility to them. This places it in the goof zone.

Although the FCC lab has authorized noncompliant products on rare occasions, followed by backpedaling, this thing is likely to bounce right back out the door, should it be submitted to them.

The device is reported to have user-adjustable power. Like that will impress the authorities. Gearheads will crank power up to maximum.

"However, carriers may file FCC complaints once the product is officially out to prevent its use and tie up the product for years under a restraining order or a similar mechanism."

No restraining order needed. The product is FCC-authorized or it isn't. As of now it reportedly hasn't even been submitted for review.

Should the FCC actually permit this against the wishes of carriers, one could expect serious efforts to get the FCC to withdraw the grant of authorization, rendering the device unlawful to sell or use. The vendors would have to account for units they sold and where they went.

You misunderstand my point about the FCC complaint. If the FCC certifies the device, the carriers would conceivably then attempt to obtain a restraining order against sale while filing complaint with the FCC. So we're actually in agreement.

Maybe MagicJack is planning to use some guard band spectrum (maybe need to pay for it !) so the GSM carriers can only argue about possible interference with its outdoor cell sites but Magicjack probably response will be that due to its low output power product, it won't affect outdoor cell sites.
At any rate, if MagicJack is serious about this product, certainly will face rough time ahead, no question about it.

I have purchased the magic jack and used it for about 2 months with no trouble.It was easy to install an had it up an running within about 5 minutes. Although about 2 months into using it I come to find my cable company knocking on my door as stating to the fact that my neighbors have complained of interference coming from our home. They said it was against FCC regulations and we have to comply with the rules and regulations. So now I have this product I paid for and 1 year of additional service which I won't be able to use. I am out $60.00 for nothing. Now I have to try to file a claim with my credit card to get it back because it is now illegal and against FCC regulations. The company says its perfectly legal but it causes interference with the cable in the neighbors homes. I have disconnected the device. Any one else out there with this problem. I guess they had to track where the interference was coming from and they found out it was within our home. Interesting.

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