Justice Dept: Are telecom carriers anti-competitive?

Following massive market consolidation, the U.S. Department of Justice may look into the business practices of behemoth U.S. telecom firms such as AT&T and Verizon Communications. According to an article in the Wall Street Journal, the DOJ has started an initial review of the telecom heavyweights, though the agency has not yet opened an official inquiry.

The DOJ may look into a variety of areas, including exclusive handset deals such as the iPhone agreement between AT&T Mobility and Apple. The news follows Congressional hearings on the issue, as well as FCC promises to review it. The DOJ also may review carrier restrictions on the types of services running over their networks.

If the DOJ does launch an inquiry, it would represent a significant blow to Tier 1 carriers that have digested a range of acquisitions over the past several years while maintaining that competition is alive and well. It would also stand as a possible victory for operators like Cellular South--which has complained that exclusive handset deals unfairly block out smaller operators--and firms like Skype that have raised concerns over access to wireless networks.

One of the key players behind this possible inquiry is the Justice Department's antitrust chief Christine Varney, who has said that she wants to reassert the government's role in policing anti-competitive practices by big companies. AT&T and Verizon combined control about 90 million landline customers and 60 percent of the nation's 270 million wireless subscribers.

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