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FCC looking into consumers who can't buy hot phones

The FCC’s inquiry into exclusive carrier deals on popular cell phones will focus on rural areas and consumers who don't have the option of buying Apple Inc.'s iPhone or Palm Inc.'s new Pre smartphone.

The FCC is looking for consumers who "live in markets that aren't served by a carrier that has an exclusive arrangement,"  FCC Chairman Julius Genachowski said in an interview with Dow Jones.

AT&T Inc. has a multi-year deal to offer the iPhone, and Sprint Nextel Corp. is the exclusive provider of the Pre.

Genachowski is concerned about people who can't buy gadgets like the iPhone or the Pre because the sole carrier that markets the phone doesn't offer service in their areas.

Exclusive agreements between carriers and manufacturers of hot phones have ignited lawmakers, consumer groups, and smaller companies that argue they can't compete with large incumbent phone companies.

Telecom giants like Verizon Wireless and AT&T argue that exclusive handset deals prompt innovation by forcing competitors to forge their own agreements with manufacturers and come up with newer and fancier phones. Verizon Wireless is a joint venture of Verizon Communications Inc. and Vodafone Group PLC.

The FCC also is asking whether such exclusive handset deals are "promoting or hindering innovation" in the wireless sector, Genachowski said.

How the FCC determines what spurs innovation in the handset market will be closely watched in the industry. Genachowski wouldn't elaborate except to say the FCC would "identify the appropriate metrics to measure and reach some views on that question."

Public Knowledge Communications Director Art Brodsky said regulators don't need data to determine whether handset deals are harmful."In an ideal world, everybody should have access to every handset," he said."This is not a data driven exercise. This is a consumer choice exercise."

Advocates like Brodsky will cry foul if the FCC doesn't make such a bold judgment and decides, instead, to focus on rural areas where AT&T or Sprint don't offer service. Carriers - which have deep lobbying pockets - will kick up a similar fuss if the FCC tries to do away with exclusive handset deals.

Genachowski has pledged, for his part, to focus on the everyday cell phone user."We have an agenda of protecting and empowering consumers," he said.

The FCC's inquiry also could subject carriers and handset manufacturers to uncomfortable questions about subscribers, pricing, or distribution of their products. Telecom companies have a history of balking at those requests, fearing their data could be used by competitors.

Genachowski has vowed to make the FCC "data-driven" and "fact-based," and his data-gathering strategy will extend to the agency's examination of exclusive handset deals.

Источник: Total Telecom

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