FCC's Genachowski lays out concerns over exclusive handset deals

As the FCC begins researching the competitive ramifications of carriers' exclusive handset offerings, it will pay specific attention to markets in which customers cannot get access to top smartphones due to such deals, according to the commission's chairman.

"In some markets, no matter what, you can't get an iPhone or you can't get a Pre," Genachowski said in an interview with Reuters. Since AT&T is the exclusive carrier for the iPhone, and Sprint Nextel for the Pre, customers in markets not served by those carriers won't be able to use the gadgets. "I don't want to prejudge it. This is the kind of thing that an expert agency should look at based on facts, based on data." Genachowski did not indicate how long the review of the issue would last.

In June, four U.S. senators asked the FCC to look into the matter, and the commission confirmed it would. Genachowski, who was still awaiting Senate confirmation at the time, said he would support the review.

Tier 1 wireless carriers, most notably Verizon Wireless and AT&T Mobility, have said the exclusive handset deals help spur innovation. Smaller regional carriers though argue the deals limit industry competition by preventing them from offering the industry's hottest handsets. Verizon has made overtures to small carriers on the issue, and recently offered to give carriers with 500,000 or fewer subscribers access to all of its exclusive devices from all of its handset partners six months after Verizon launches the phones.

Genachowski said he was mindful of the FCC's role in the debate. "Promoting competition is absolutely a main function of the FCC," he said in an interview with Bloomberg.

In his interview with Reuters, Genachowski also emphasized the importance of crafting a national broadband plan, empowering consumers and making the FCC an agency that relies more on data to make policy.  

For more:
- see this Bloomberg article [1]
- see this Reuters article [2]

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Verizon offers small carriers a deal on handset exclusivity [4]
Justice Dept [5]: Are telecom carriers anti-competitive?
What would happen if exclusive handset deals were outlawed [6]?
FCC will investigate handset exclusivity deals [7]
Senators probe carriers on exclusive handset deals [8]