It sounds reasonable enough on the surface to say that a cellular carrier should be able to make a deal with a phone manufacturer for exclusive distribution rights. AT&T used to have one of those for several decades with a company called Western Electric. And while folks complained about the service from time to time, they didn't complain much about the phone...back before they had touchscreens. But what if you're a rural communications company, and you can't exactly make such exclusive deals. Is it unfair that you're not entitled to make a deal for something as hot as the iPhone? Think it doesn't matter much? Ask the state of Vermont, where you can't buy an iPhone...because AT&T doesn't cover Vermont except for roaming. Imagine, the nation's second largest carrier doesn't sign up customers in an entire state represented by Patrick Leahy. That might not be a good thing.
Afternoon of June 15, 2009 ? Our representatives in Washington have taken an interest in what's up with our mobile phones, with two investigations currently announced or underway. In the first one, four senators -- Byron Dorgan (D - N.D.), John Kerry (D - Mass.), Amy Klobuchar (D - Minn.) and Roger Wicker (R - Miss.) -- have formally asked the FCC to look into whether handset exclusivity deals such as AT&T's for the iPhone or Sprint's for the Pre are limiting consumers' ability to use their phones fully.
The senators' action is in response to a letter filed with the FCC by the Rural Cellular Association last month (PDF available here), petitioning for a review of the concept of exclusivity arrangements, arguing that they may be against the public interest.
"For many consumers, the end result of these exclusive arrangements is being channeled to purchase wireless service from a carrier that has monopolistic control over the desired handset and having to pay a premium price for the handset because the market is void of any competition for the particular handset," the RCA wrote. "For other consumers ??"- particularly rural ones ??"- these exclusivity arrangements prevent them from purchasing many of today's most popular handsets because they reside in areas not served by the one carrier offering the desired handset. For example, almost one year after launch, residents of Vermont still cannot use an iPhone without violating the terms of AT&T's standard service contract. Why? AT&T provides only roaming service in Vermont and does not allow its subscribers to spend more than 40% of their airtime roaming. The iPhone is also unavailable to most rural residents of Alaska, Arizona, Colorado, Idaho, Kansas, Maine, Montana, Nebraska, Nevada, New Hampshire, New Mexico, North Dakota, South Dakota, Utah and Wyoming."
Aha!!! Take that, AT&T!
Up Front: Congress asks about AT&T iPhone exclusivity | Tech Policy & Law News - Betanews
And video here:
Congress Tackles iPhone Exclusivity Deals on Yahoo!7 Video