The FCC’s probe of cell phone contracts and exclusivity deals will reportedly focus on markets where the iPhone and the Palm Pre aren’t available — that is, where AT&T and Sprint don’t have service. FCC chairman Julius Genachowski told Bloomberg, “There are markets in the country where if you wanted an iPhone, if you wanted a Pre, you couldn’t get it — from anyone.” Indeed, a look at AT&T’s coverage viewer (see image) shows large chunks of the country that don’t have access to the carrier’s network; ditto for Sprint. So is Verizon onto something with its approach, which allows smaller carriers — including those that focus on rural areas — access to its “exclusive” phones?
Two weeks ago, Verizon changed its policy around exclusivity arrangements, agreeing to limit them to a maximum of six months, and to give smaller carriers (like those that focus on rural areas) immediate access to its “exclusive” phones. At the time, Stacey wrote: “These concessions on exclusivity are likely a response to heightened federal scrutiny around” handset deals. Aha! Putting two and two together, Verizon’s policy changes are a nearly perfect response to the concerns that Genachowski voiced above — and, as Stacey pointed out, puts Verizon in an excellent position to point fingers at the “anti-competitive practices” of its competition. Of course, giving up long-term exclusivity deals is easier for Verizon than its competitors because Verizon doesn’t have an exclusive deal on any hot phones like AT&T and Sprint do, with the iPhone and Palm Pre, respectively.
(Image courtesy of AT&T)
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