DoJ to probe US telco sector: report
The US Department of Justice has begun an initial anti-trust probe into the telecom sector, the WSJ Online has reported.
It is not a formal inquiry into any particular carrier, but to see whether tier one1 telcos such as AT&T and Verizon have abused the market power they've amassed in recent years, the Journal said,
quoting un-named sources.
The US Justice Department is not commenting on the report. Carrier officials for Verizon told Reuters they had not had any formal advice on a probe, while AT&T and Sprint defended their pricing and handset practices.
The most high-profile area of potential abuse is the exclusive handset deals that handcuff consumers to particular carriers, most prominently with the iPhone. US carriers wield much more market power than their counterparts in Asia and Europe, where the markets is driven more by the handset-makers themselves or retailers.
US legislators, such as former presidential candidate John Kerry, have complained that these arrangements could hurt consumers or smaller mobile operators. They have also complained about the pricing of text messages.
Another area of possible inquiry is the pricing of backbone and backhaul access. A new interest group, called NoChokePoints, complains that large telcos like AT&T and Verizon “control the broadband lines of almost every business in the United States.”
The group, whose membership includes smaller carriers such as Sprint, Covad, BT and XO, has called on the FCC to “stop the abuse of market power” of large operators.