THE LAW BEHIND… your mobile phone

Text Messaging

The popularity of text messaging has created a minefield of potential litigation.

In June, 950m messages were sent in the UK, many of which were advertisements.

A spokesperson close to Orange’s in-house legal team says they have created safeguards to protect customers from ad-peddlers.

“We are creating strict guidelines for people who want to send mass messages,”says the spokesperson. The legal team are embroiled in legal action against a company accused of spamming their server’s inboxes. “We will not allow people to use our network to spam,” he says.”They have to register their plans with us first.” Text messaging can also create another avenue for stalkers. “If people feel harassed by controversial messages, they will probably be treated like malicious phone calls in the courts.”

Value Added Services

Phones and contracts are often sold with extras or value added services but packages can incur competition restrictions.

Colin Long, an entertainment partner from Olswang, says a company that only offers WAP services from their websites might be liable to monopoly charges. Allen & Overy communications, media and technology partner Chris Watson confirms that lawyers always have to second-guess the concerns of market regulator, Oftel. “We have to understand what Oftel wants to achieve. Then read their guidelines and talk to the regulators,” he says.

“Unfortunately competition regulations are applied once an incident has happened and lawyers have to resolve them.”

He recalls a case earlier this year when his client, One2One, came under attack from Oftel for their call charges on other networks. Watson found the
regulator was acting beyond their powers and One2One feared that company strategies revealed by the investigation could impede their competitiveness.

In a fast-paced, competitive field Watson had to resolve the enquiry without jeopardising his client’s position in the market. “My client was very concerned about the enquiry and how information would be used. It was my job to see they were treated fairly.”

Base Stations

Phones and contracts are often sold with extras or value added services but packages can incur competition restrictions.

Colin Long, an entertainment partner from Olswang, says a company that only offers WAP services from their websites might be liable to monopoly charges.
Allen & Overy communications, media and technology partner Chris Watson confirms that lawyers always have to second-guess the concerns of market regulator, Oftel.

“We have to understand what Oftel wants to achieve. Then read their guidelines and talk to the regulators,” he says.

“Unfortunately competition regulations are applied once an incident has happened and lawyers have to resolve them.”

He recalls a case earlier this year when his client, One2One, came under attack from Oftel for their call charges on other networks. Watson found the regulator was acting beyond their powers and One2One feared that company strategies revealed by the investigation could impede their competitiveness.

In a fast-paced, competitive field Watson had to resolve the enquiry without jeopardising his client’s position in the market. “My client was very concerned about the enquiry and how information would be used. It was my job to see they were treated fairly.”

Base Stations

The expected demand for 3G mobile phones has spawned the need for yet more base stations.
Stations pick up signals whenever a call is made and diverts it to the intended recipient.

But complaints have been made about their appearance and their potential health risks.
Neil Brown, head of the telecommunications team at Eversheds in Leeds, describes the problem as nonsensical.

“If people want mobile phones and the benefits they bring, there is a pressure to build networks,” he says.

He advises three of the country’s six tower companies who provide the stations for network masts.

Brown describes his work as varied and spontaneous: “Some people at corporate level think the work is generic but every project is different,” he says.
Brown advised SpectraSite on its 50/50 joint venture with Transco to build towers on its gas sites.

“The biggest difficulty with landowners is overcoming concerns for their business,” he says.

A relationship with like-minded risk takers is necessary for a smooth deal, according to Brown.

Environmental issues can also pose threats to proceedings but Brown says lawyers have to remain firm.

“There is lots of planning and construction work involved. People worry a mast could be an eyesore and we have to make it clear [to landowners], they
can either have the revenue assisted from masts or not, but they cannot have masts removed once they are up.
These deals cannot be done on a whim.”

So you think you know your mobile? In the first of a series exploring the law behind everyday items, Dawn Knight exposes the legal machinery that drives the mobile phone industry

Ring Tones

Popular tunes have been transformed into simple ditties for mobile phone users to download from the net. But many sellers have not paid copyright fees and some in the music industry claim the ringtone craze has spawned a new Napster.

Music lawyer Antony Bebawi of Harbottle & Lewis in London thinks this an assault on songwriters and that composers are being exploited.

The Mechanical Copyright Protection Society, which protects sound recordings like CD production, and the Performing Rights Society, which monitors public performances, represents them. Bebawi says: “Ringtone operators should get licences from these bodies before they distribute tunes.” The licensees receive royalties from the ringtone seller’s profits.

If copyright action is taken, judges have to decide what amounts to substantial copying.An artist’s moral rights can be infringed if their melody is reduced to an embarrassing jingle. In theory, copyright claims can extend to second or third parties so customers who download from illegal sites may also risk charges but, Babawi says in practice illegal copiers are difficult to trace.

Illegal downloads are costing the music Industry 750,000 a day.

Cambridge-based software company Envisional found hundreds of sites offering well known tunes without paying the artist’s 4p duplicate fee.

Last year, Robbie Williams’ hit Rock DJ was one of the most requested tunes in the UK. One site monitored over 50,000 downloads of the Mission: Impossible theme in one eight-week period alone.

WAP

b>When two of the fastest growing industries joined forces,bringing together wireless communications and the Internet, wireless application protocol (WAP) was born.

Its development was supported by phone giants Motorola, Nokia, Ericsson and US software company Phone.com. Laurence Kaye, head of technology and e-business at Garretts’ London office, believes WAP has brought content deals into the wireless-age.

“Lawyers have to consider how WAP- generated revenue will be split between the handset manufactures, mobile phone networks and internet providers.”
They have to question how the sites are billed – real time or pre-paid- and which company will do the billing.

As well as being aware of technical developments, Kaye believes lawyers also need a strong understanding of traditional contract law: “The period of agreement and removal of contract are also key areas that need to be negotiated.”

Global Positioning

The UK might be brought a step closer to creating privacy laws when mobile Global Positioning Systems (GPS) are launched this autumn. A chip, sold as a mobile phone accessory, could enable advertisers to track people wherever they go. Concerns have been raised as to how the information will be used.

Sarah Thomas from Charles Russell believes that people could issue privacy complaints disguised as a breach of confidence.
“Privacy laws in the UK are in a state of flux. But it would be easy for customers to bring a breach of confidence claim against a company.” Sarah,
who assisted Hello magazine on the Catherine Zeta-Jones and Michael Douglas’ claim of harassment, thinks that lawyers working for mobile phone companies may have to prepare for lots of similar claims.

“If people are bombarded with 40 messages a day there could be a argument for harassment.”

The Harassment Act 1997 equates the term with a course of conduct that causes a person distress. Data Protection Acts could prevent complaints by imposing restrictions on the distribution of personal material. Later this year, a European telecommunications directive will include a GPS clause. Phil Jones, assistant information commissioner from the Information Commissioner Office hopes that this will reduce complaints.

“Subscribers will be allowed to choose when they want to receive GPS services,” says Jones. “But it might be possible to locate someone when their phone is off.”

The auction for third-generation mobile- phone licences brought competition law into the spotlight.

An auction of the radio communications spectrum was chosen by the government in order to encourage new networks into the market. But four out of the five licences went to big players, (Vodaphone, Orange, One2One and BT) who paid 4-6bn each.

Mark Mladek, an associate communications, media and technology lawyer from Allen & Overy suggests the auction actually hindered competition in the field.

“Solicitors now have to advise 3G licence holders on how to get finance for 3G. There is already a sharing of costs.” BT and Deutsche Telekom have decided to use the same base-station towers to anchor their masts. But Mladek thinks companies that were outbid may complain that joint ventures were not mentioned at the time of auction.

A source close to BT believes that joint ventures are inevitable to cover the massive debts created by the licence costs.

“Companies could have built networks separately but because of the added costs they have done it together.”

The venture between the British and German phone giants has created new legal obstacles.

Lawyers are investigating cross-border telecommunications regulations, an area with little precedence. As one lawyer said: “This is a new and exciting area for telecom lawyers. Each new challenge can only be to resolved by brainstorming.”

Handset Design

A lawyer who works on handset research and development believes this is one of the most secretive sides of the industry.

“We are always trying to come up with new features,” he says. “But everything we do has to be kept under wraps.”

In-house lawyers arduously check design and copyright infringements and register new inventions with The Patent Office. A patent is granted when a design is materially and aesthetically different from others.

Registered designs are protected for 25 years but, with the owner’s permission, lawyers can negotiate selling all or part of the rights. A patent is also in danger of revocation. Under the Patents Act 1977, if disputes arise about the originality of a design, protection can be terminated. Design patents include Nokia’s lock feature, which is activated by pressing two buttons in succession and Motorola’s designers automatic flip down and answer feature.

“We are always looking for the next step forward,” says the lawyer. In January 01, American toy-maker Randi Altschul created a paper mobile phone.

The disposable product took four years to design and more than 20 patents. Called the Phone-Card-Phone, it is made from recycled paper and is the thickness of three credit cards. The phone which will be available later this year, has systems made of light metal ink and comes with 60 minutes talk-time and a hands-free attachment.