FCC Fines Smart City $750K For Blocking Wi-Fi 188
schwit1 writes: FCC's Enforcement Bureau today announced a $750,000 settlement with Smart City Holdings, LLC for blocking consumers' Wi-Fi at various convention centers around the United States. Smart City, an Internet and telecommunications provider for conventions, meeting centers, and hotels, had been blocking personal mobile 'hotspots' that were being used by convention visitors and exhibitors who used their own data plans rather than paying Smart City substantial fees to use the company's Wi-Fi service.
Fine vs profit? (Score:5, Insightful)
If the fine isn't substantially more than the profit they made from blocking wifi, there is no incentive to stop the practice. The fine will be just another cost of doing business.
Re:Fine vs profit? (Score:5, Insightful)
the first fine is a slap on the wrist, but if they continue the next fine will be substantially larger, order of magnitude larger. The FCC might only slap on the wrist for 1st offense, but they get real serious when people don't follow their direct orders.
Re:Fine vs profit? (Score:5, Informative)
the first fine is a slap on the wrist, but if they continue the next fine will be substantially larger, order of magnitude larger. The FCC might only slap on the wrist for 1st offense, but they get real serious when people don't follow their direct orders.
they signed a settlement agreement in the court room, so further infractions are really "contempt of court" with immediate jail for the offenders
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true, but that doesn't release them from FCC liability either. And the chances of a settlement are near zero for a second offense. I've seen second FCC fines in another wireless industry, they are no joke.
Re:Fine vs profit? (Score:4)
They will even kick ass on Power companies that inadvertently create a lot of interference via power line issues like cracked insulators, and other such oddities that create sparking or other noise issues.
If a noise complaint occurs, and it checks out, the FCC sends a nice letter - If fixed, everyone is happy. If not, a nastygram is delivered. If fixed, everyone is happy. It still not fixed, they bitchslap the company with a fine, or forfeiture as they call it. That forfeiture is really hard to get out of, given the chances they give.
A second offense? I've never seen one, but it would be really foolish. I'll have to look up what happens then
Some times a power company has someone who doesn't take the complaints seriously, perhaps since most of them come from Radio Amateurs. But the Hams are a licensed service, and have the equipment and wherewithal to find the problems. So they carry a lot of veracity.
But to the topic at hand, a 750,000 fine might be considered a lucky break for Smart City, who were definitely not being smart. Another time? Be probably like pissing off Mr Bigglesworth.
Re:Fine vs profit? (Score:5, Informative)
Contempt of court has nothing to do with the FCC. The FCC will still come after the business for the second fine for which they are unlikely to accept any settlement. Also, you can't jail a corporation, only it's officers which is VERY hard to do, just look at the banking fiasco and how few people were jailed over it. This will likely only ever come down to fines and more fines if they repeat until the business loses solvency.
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It's likely easier to jail a Corporate Officer for contempt of Court in disregarding a consent agreement, than it would have been to jail them on the original matter; not to mention that the action that violated the agreement would be a second count and liable for an other $0.74M fine, wash, rinse, repeat.
Re:Fine vs profit? (Score:4, Informative)
no, your talking criminal contempt, this is civil contempt and the punishment would most likely be commutation of the settlement and liability for court costs. This is against a corporation, not individuals, there's no specific person that is liable and it wasn't a criminal offence.
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It's a criminal offense, not a civil one. The officers are directly liable.
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corporations are owned by people, they are responsible for its actions
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Imagine how well behaved corporations would be if shareholders were imprisoned for the actions of the corporations by which they generate profits. What do you think share value would be for ill behaved corporations that break laws and their share holders are punished. You might think that sounds awful but consider this, what is the punishment for citizens of a country that goes to war, summary random public execution. So if every citizen comes under threat when countries do bad things why shouldn't every s
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so nothing happens to you in the US when you violate a consent decree? there is no offense? they don't put you in jail? is that what you are saying?
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This is in the US. I'm pretty sure it doesn't work like that here.
Well, you're wrong [justice.gov].
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In your cited case, I'm pretty sure that doesn't even count the lawsuits from the 1,000+ people who got sick off of the product... pretty sure that company is pretty much dead. All it would take is for one lawsuit [marlerblog.com] to knock 'em down if the jury is in the right mood...
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This is an example of the owner of a company (and his son who was the COO) going to jail after pleading guilty to crimes. This is in addition to the company itself pleading guilty (making up the 3 defendants). What it does not show is that the owner of a corporation is necessarily responsible for the crimes committed by the corporation. It may not even be true in this case, as the 2 people and the company were listed as 3 separate defendants.
It would be a different story if the company was the only defen
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I'm pretty sure it does, someone will go to jail for it. Whether the someone who goes to jail for it is the person most responsible for the crime is much harder to be sure about.
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that would be the parties that signed the consent decree
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Unless those people took a golden parachute and were replaced by the time the second offense occurs, right?
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so with a full slate of criminals on their management staff, I'm sure their business is doing great
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You can give a corporation a death sentence by revoking its charter. I think?
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A corporation in jail - that's not gonna happen (Score:5, Insightful)
The day I see a corporation behind bars is the day they'll start to listen. Now, if you were to "jail" them by requiring a halt of all stock trades, impound all assets, suspend all business operations, and revoke the corporate status and protection for all holdings and subsidiaries for the length of the jail term. That would get people's attention.
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The day I see a corporation behind bars is the day they'll start to listen.
http://www.bloomberg.com/news/articles/2014-12-19/ex-billionaire-timothy-blixseth-jailed-for-contempt-of-court-1-
they most certainly do put corporate executives in jail for contempt of court
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I think that halting all stock trades would be enough. Especially if the halting is done a few hours after a warning to make the stock price drop really low.
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That would be a death sentence.
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Most of the things you list would punish the stock holders, who are just as likely to be a pension plan for retired veterans. You want to punish those responsible, not the senior citizens who got blindsided by the crimes of someone else.
Are you kidding? No retirement plan or index fund is heavily invested in a single stock, just in case something happens to the stock price. Corporate malfeasance is just one of many possibilities, so fund managers hedge their bets and spread the risk amongst dozens or hundreds of stocks. You're not going to seriously hurt grandpa Joe by bankrupting these slimeballs.
Regardless of their percentage of investment, the actions of the company are indeed the responsibility of the stockholders. While they may no
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they signed a settlement agreement in the court room, so further infractions are really "contempt of court" with immediate jail for the offenders
Please tell me this is sarcasm and you don't actually think this would ever happen.
Re:Fine vs profit? (Score:5, Interesting)
you can find this on google if you look:
Marvin Chaney, 61, founder of RoboVault, was taken into custody by U.S. Marshals on January 29 on the orders of U.S. Bankruptcy Judge John K. Olson for violation of court orders.
Brandon bankruptcy attorney O. Reginald Osenton commented, “This goes to show you how important it is to follow carefully a judge's instructions, no matter what type of case you are involved in.”
Olson issued the arrest order after Chaney and his attorney, Lawrence Wrenn, did not show up for a court hearing on January 17. Appearing shackled before the judge, Chaney said that Wrenn had advised him not to attend the hearing and that he had tried his best to produce the records that had been requested of him.
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Not for causing oil rig explosion that killed people, oil spills, coal ash wash outs, nearly destroying the global financial system, lying about the company prospects... nothing seems to put the top bosses in jail.
Have any of those people signed consent decrees, agreeing that they are guilty of contempt of court if they violate the decree?
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RTFA:
"As part of the settlement, Smart City will cease its Wi-Fi blocking activities"
Where is the loophole? Consent decrees are intentionally made very simple and straightforward so there are no loopholes.
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Sure you have. Just from the MCI/Worldcom case:
Bernie Ebbers, CEO - 25 years (he'll probably die in prison)
Scott Sullivan, CFO - 5 years
David Myers, controller - 1 year
Buford Yates, director of accounting - 1 year
Betty Yates, accounting manager - 5 month
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Source? The link will take you to a link with the consent decree, which was directly between the FCC and Smart City. I don't see where a court was involved anywhere.
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the first fine is a slap on the wrist,
I would describe this as a "tap on the wrist".
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$3/4 Million is a big chunk out of managements bonuses I think...
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Re:Could be argued differently... (Score:5, Insightful)
The argument can be raised that it is their hotel, and their rules.
If I went to a pub and brought my own booze, I'd be tossed out. Same rule can be argued to apply with Wi-Fi.
Only if you had absolutely no idea what you were talking about. Wireless transmissions take place on publicly owned airwaves. Jamming these airwaves is theft of publicly owned bandwidth.
Re:Could be argued differently... (Score:4, Informative)
Jamming is wilful obstruction of communications. It's criminal rather than civil.
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They don't jam the signals (in the sense of broadcasting noise). They turn the building into a big faraday cage. I stayed at one of these hotels and my phone's reception went from 4 bars outside to 0-1 bar inside. I tried standing next to a window and still was barely getting a signal. Later I found out they make conductive film [www.slt.co] you can put on the windows - optically transparent bu
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They don't jam the signals (in the sense of broadcasting noise). They turn the building into a big faraday cage. I stayed at one of these hotels and my phone's reception went from 4 bars outside to 0-1 bar inside. I tried standing next to a window and still was barely getting a signal. Later I found out they make conductive film [www.slt.co] you can put on the windows - optically transparent but makes for a seamless faraday cage.
It is my understanding that that would be legal (though still sleezy). As long as the building materials do not emmit radio waves, the FCC has no authority. But, you're right, they are not broadcasting noise. They are spoofing packets from the 'rogue' wireless access points. These packets tell the clients that they are being kicked off and the clients disconnect. It is a highly efficient and effective form of jamming.
The hotels fined for doing this complain that they should be allowed to do it because they
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You mean something like this [macrumors.com]?
$750K only? (Score:4, Insightful)
Seems the fine doesn't fit the crime.
Smart City? (Score:2)
More like dumb city. Very dumb city.
'Ehhh - thiks?' What is this 'ehhh - thiks'? (Score:2)
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The Enforcement Bureau’s
investigation revealed that Smart City automatically blocked consumers from using their own “rogue”
Wi-Fi networks at several convention centers the company serves, including the convention centers in
Cincinnati, Ohio; Columbus, Ohio; Indianapolis, Indiana; Orlando, Florida; and Phoenix, Arizona.
Where does the money from the fine go? (Score:2)
Re:Where does the money from the fine go? (Score:5, Funny)
How much of that $750,000 fine goes to the people who had to pay $80/day for Internet service because they couldn't use their WiFi hotspot?
I'm going to guess the answer is $0
They can have all of the $80 back after they file a $100 fee
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One thing I remember from watching court TV shows such as 'Judge Judy' is that a criminal conviction is pretty much a slam dunk in a liability case.
So, since their actions amounted to extortion(We illegally blocked your signal so you had to pay us), this is now ripe for small claims cases and/or a class action lawsuit.
BTW, that $100 fee for a small claims court case? That $80 for the service you were illegally forced to buy just turned into a $180 claim, plus a few other things, most likely.
Then, if they d
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Do you really assert that corporations are going to hire lawyers, fill out depositions, etc. to recover an $80 fee? you are dreaming. There is no way it is worth the effort.
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Do you really assert that corporations are going to hire lawyers, fill out depositions, etc. to recover an $80 fee? you are dreaming. There is no way it is worth the effort.
Nope, they send a $10/hour intern down to the local courthouse to file a small claim, and add the intern's hours onto the bill.
You should have recognized this by the words 'small claims court'. They explicitly don't require lawyers or do depositions.
You show up with your receipt or credit card bill for the $80, a copy of the court case(printed off the internet is 'good enough' in small claims), and the judge will likely give you the judgement, especially if the company doesn't send somebody, such as anothe
Re:Where does the money from the fine go? (Score:4, Funny)
None of it, it'll all go into the general fund and within nanoseconds it'll disappear to pay for F-35 parts.
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Remember, the primary purpose of justice in the USA is revenge (a.k.a. "retribution"), not restoration.
Re:Where does the money from the fine go? (Score:5, Funny)
Remember, the primary purpose of justice in the USA is revenge (a.k.a. "retribution"), not restoration.
yes, in other countries they bring back murder victims from the dead
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That's a good reason why restoration also should not be the primary purpose of justice.
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the purpose of justice is to remove offenders from the community to keep the rest of us safe
"Revenge is for suckers" - Gondorff, The Sting
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If that were true, we wouldn't let people out of jail until they've been rehabilitated.
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How much of that $750,000 fine goes to the people who had to pay $80/day for Internet service because they couldn't use their WiFi hotspot? I'm going to guess the answer is $0
Nope. Those people would have to individually sue. It would be better for those hypothetical plaintiffs if Smart City hadn't got to settle, but even the settlement would seem to indicate fault.
No, not blocking! (Score:2)
.
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We were ahhh...ensuring quality control by filtering out potentially disruptive signals, Yeah, that's the ticket! .
I'm sure they tried to use that argument but the FCC saw right through the veneer. Furthermore, they tried claiming it was to prevent attacks on their network but SmartCity couldn't prove that they were being attacked.
Class action law suit is deserved (Score:5, Interesting)
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Why? So they can get a voucher for $10 off from their next WiFi use?
I'm still waiting for the day a Class Action suit actually benefits anyone other than the lawyers for both parties.
How did Smart City block wifi hotspots? (Score:2)
I clicked on the link but it doesn't say what Smart City did exactly, it just says they "blocked" it.
Was it by using an active jammer? Was it with lead paint or a Faraday cage? Or?
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FCC doesn't get involved with Faraday cages as they're legal. Lead paint would have many agencies OTHER than the FCC coming, and at that point a $750k fine would be the least of their concerns. OSHA, EPA, FDA if food is served in the building, etc...
If they use the aluminum-iron oxide paint that's available for the stated purpose, it's the same as a Faraday cage, legal.
Nope, if the FCC is involved they were jamming via active broadcast.
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Something to do with deauth packets on any other ap in range.. so nobody could connect to ANY ap other than theirs.... diabolical...
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Something to do with deauth packets on any other ap in range.. so nobody could connect to ANY ap other than theirs.... diabolical...
Yep. And it's not like they warned the companies renting the booths. I had one demo fail and require emergency workarounds because of these clowns. We just wanted to broadcast a LAN connection across the booth to avoid having to run cabling under our carpeting. No internet or anything.
I wonder how they're jamming? (Score:2)
Re:I wonder how they're jamming? (Score:5, Informative)
If you read the ARS [arstechnica.com] article on this, you would see that:
"In responses to FCC investigators, Smart City later revealed it "automatically transmitted deauthentication frames to prevent Wi-Fi users whose devices produced a received signal strength above a present power level at Smart City access points from establishing or maintaining a Wi-Fi network independent of Smart City's network," according to a consent decree filed in the case."
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Interesting, so a savvy user could circumvent this nonsense by tethering their hotspot (or smartphone) via USB or Bluetooth.
Only if you just needed a WAN connection on a single machine. If you wanted to create a WLAN as a presenter, you were SOL.
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well, they could have.
but it wouldn't have been wifi then.
but why should they, when interfering with other networks is illegal.
mind you, had this been some 18 year old kid doing that deauthing, then he would be in prison for hacking now. so the world isn't fair.
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I'm curious if anyone has witnessed this in action, do they block cell signals entirely?
They most likely didn't block cell signals, but had transmitters up in a 'active mode' that would spam disconnect notices to any wifi that wasn't using their SSID. Such are 'readily' commercially available. It was even an option on a system I was involved in the installation of, which for security purposes included pure-monitor stations that did nothing but listen for 'rogue' wifi signals...
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Then they would get hit with the fine again and again until they quit it. It is just like speeding. You get a ticket today for speeding, you are not covered, if you speed again you can get a ticket again right away.
And people are going to be watching this company very closely now.
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More to the point, if you keep getting fined for the same offenses, those fines are going to increase, and stronger measures may eventually be used to, if not assure compliance, then so damage the company that compliance ceases to be an issue.
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More to the point, if you keep getting fined for the same offenses, those fines are going to increase, and stronger measures may eventually be used to, if not assure compliance, then so damage the company that compliance ceases to be an issue.
So this company might stop doing it. But what about other companies doing this or other illegal things? It pretty much communicates that go you can go ahead and do whatever the heck you want until you get caught, because even after you've been busted the fine will be less than your profits. It's not like this is a new thing that they might not have known was illegal, they clearly just didn't give a shit because they knew if they got caught their illegal activity would still be profitable.
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even after you've been busted the fine will be less than your profits.
Violating a consent decree means go straight to jail, do not pass go, do not collect $200, no trial. What business is worth that?
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even after you've been busted the fine will be less than your profits.
Violating a consent decree means go straight to jail, do not pass go, do not collect $200, no trial. What business is worth that?
No one who is caught the first time with a violation like this is party to any consent decree. Only the party that 'consents' to it is.
The point of the poster above is that this sets a (very low) price for stealing public bandwidth until after you are caught the first time. A light fee for first time burglary convictions as the only punishment makes burglary very attractive until that first conviction. Not much of a deterrent to all the other burglar wannabes.
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makes burglary very attractive until that first conviction. Not much of a deterrent to all the other burglar wannabes.
this is a business model in whose universe?
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One where I'm going to start a company and make billions of dollars then retire rich after paying $750M in fines and promising a judge that I'll never do it again.
but first you have to get your mother's permission
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In some places you even have to reimburse the government for your room and board while in jail; I wonder how many c-levels have that in their compensation packages?
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RTFA
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Marriot Hotels got hit the same way a year or so ago by blocking other wifi than theirs at their convention centers.. It was fun to hear them try to justify why they did it.. Things like "we were protecting our guests from rouge wifi access points, you should thanking us...".... Riiiiight.. Tell that to someone who believes you weren't just doing it to force people to use your grossly overpriced wifi...
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What is the first law of unlicensed bandwidth; THOU SHALT NOT INTERFERE
Fucking assholes.
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yes but the same analogy applies to if they make more than the fine, they will just add it as cost of doing business.
Re:Did they make more than $750K profit by blockin (Score:5, Informative)
RTFA:
"As part of the settlement, Smart City will cease its Wi-Fi blocking activities"
They signed a court order, if they keep doing it, it's contempt of court this time.
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The way to get around this is to sell the blocking technology to your competition. Money is money, it's not about the blocking.
just imagine the sales pitch: "warning: you may face heavy fines and criminal contempt charges", yes that is a great incentive
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Not a fine. A 'settlement'. Which could mean they agree to pay $750,000 without admitting guilt and promise never to do it again. So they effectively have a clean record for the purpose of bidding on contracts where this is a requirement.
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No, the real problem is that you have line-of-sight communications to every cell site until the visible horizon. This tends to use up frequencies over a very large area. In general the antennas have been engineered not to work at high angles, but this can't be complete and the ones on the horizon may see you at the same angle as their regular users.
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Still are - there are documented instances where particular models of cellphones have interfered with navigational equipment - either causing the onboard heading indicators to indicate a few degrees off, to GPS units losing lock. With GPS being prominent in a lot of new approaches, especially RNP operations, this could be a problem.
Now, the vast majority of cellphones out there are fine - they don't interfere, but several m
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Still are - there are documented instances where particular models of cellphones have interfered with navigational equipment - either causing the onboard heading indicators to indicate a few degrees off, to GPS units losing lock. With GPS being prominent in a lot of new approaches, especially RNP operations, this could be a problem.
Now, the vast majority of cellphones out there are fine - they don't interfere, but several models have proven problematic.
Don't worry too much about it though - they usually detect these issues and confirm it with the flight attendants asking everyone to turn off their electronic devices to see if their navigation equipment recovers. There are typically plenty of checks in the system - if the plane was off course, people generally know before your flight to LA ends up in Timbuktu.
Strange that they would interfere with modern commercial airline instrumentation with multiple redundant hardware, yet not cause any problems in small aircraft instrumentation, as pilots in small airplanes user cell phones all the time in the cockpit as opposed to 50 feet away.
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No, the small-aircraft owners aren't at risk of messing up their avionics. They are, however, consciously messing up the cellular network for everyone else. You see, you are supposed to be in range of just a few cells when you use your phone, so that we get frequency reuse between cells. If you are at altitude, you are in line-of-sight communications with all of the cells out to the visible horizon on all sides. And the frequencies you are using are probably locked out from reuse over that entire vast area.
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Aren't you supposed to be paying attention to the conference instead of playing Angry Birds or posting photos to facebook or leud comments to twitter?
aren't you supposed to be your real-time eyes and ears at this conference? we want to see the competitor's machines in action. get over there right away