Don’t Like AT&T’s Hold On The iPhone? Tell Your Senator
Several U.S. senators urged the FCC to examine the widespread use of exclusive arrangements between handset makers and carriers to see if they negatively affect competition and choice in the marketplace.
Reuters reports that the Senators voiced their concerns in a letter to Michael Copps, acting chairman of the FCC. The letter said: “We ask that you examine this issue carefully and act expeditiously should you find that exclusivity agreements unfairly restrict consumer choice or adversely impact competition in the commercial wireless marketplace.”
For better or worse, the industry currently revolves around exclusive agreements. Every major U.S. carrier has its flagship device: AT&T (NYSE: T) has the iPhone, T-Mobile has the G1, Verizon Wireless (NYSE: VZ) has the BlackBerry Storm and Sprint (NYSE: S) has the Palm (NSDQ: PALM) Pre. The deals likely make the devices cheaper for consumers, but also limits choice when it comes to picking the carrier. But it is not the big four in the U.S. that are complaining. The Rural Cellular Association, which represents more than 80 small town wireless providers, filed a petition with the FCC to look into whether consumers benefit from exclusives. It’s particularly difficult for a smaller carrier, or a discount provider, like Leap or MetroPCS, to get their hands on a popular handset when the larger carriers get first pick.
The letter sent to the FCC was signed by such Senators as Democrats John Kerry, Byron Dorgan of North Dakota; Amy Klobuchar of Minnesota and Republican Roger Wicker of Mississippi. The senators will hold a hearing Wednesday to see if legislative action is necessary.
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