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Report: A Telecom Antitrust Inquiry?

News report says the DoJ has opened in inquiry into – gasp! – the possibility of anticompetitive practices in the telecom industry

Phil Harvey

July 6, 2009

1 Min Read
Report: A Telecom Antitrust Inquiry?

The Wall Street Journal is reporting that the U.S. Justice Department is taking a look at whether the nation's big behemoth telecom firms have behaved like, er, big behemoth telecom firms.

Issue #1: Exclusive device deals
A story published by the newspaper today cites sources that say Justice could explore "whether wireless carriers are hurting smaller competitors by locking up popular phones through exclusive agreements with handset makers."

The Apple Inc. (Nasdaq: AAPL) iPhone's exclusive arrangement with AT&T Inc. (NYSE: T) could be seen as a catalyst here. That is, unless someone, somewhere, is still sore about Cingular (now part of AT&T) getting the first crack at the awful Motorola Inc. (NYSE: MOT) Rokr music phone, back in 2005.

Issue #2: Service restrictions on networks
But device exclusivity may not be the only issue here. The paper also cited a single source that claims Justice "may also review whether telecom carriers are unduly restricting the types of services other companies can offer on their networks."

AT&T, for example, has noted that it blocks peer-to-peer (P2P) applications on its wireless network. (See Et Tu, AT&T? )

The WSJ's full story, complete with no comments from the Justice Department, AT&T, and Verizon Communications Inc. (NYSE: VZ), is here.

For a quick refresher on how the iPhone's popularity has helped AT&T's profits (while sometimes skinning its margins) in the U.S., see:

  • Apple Sells 1.7M iPhones in Q2

  • The iPhone's Fat ARPU

  • iPhone Hits AT&T Margins

  • AT&T: Another Bumper iPhone Quarter

  • New iPhone Costs $179 to Build

— Phil Harvey, Editor-in-Chief, Light Reading

About the Author(s)

Phil Harvey

Editor-in-Chief, Light Reading

Phil Harvey has been a Light Reading writer and editor for more than 18 years combined. He began his second tour as the site's chief editor in April 2020.

His interest in speed and scale means he often covers optical networking and the foundational technologies powering the modern Internet.

Harvey covered networking, Internet infrastructure and dot-com mania in the late 90s for Silicon Valley magazines like UPSIDE and Red Herring before joining Light Reading (for the first time) in late 2000.

After moving to the Republic of Texas, Harvey spent eight years as a contributing tech writer for D CEO magazine, producing columns about tech advances in everything from supercomputing to cellphone recycling.

Harvey is an avid photographer and camera collector – if you accept that compulsive shopping and "collecting" are the same.

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