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Senators Want To Grill Wireless Carriers, Manufacturers

Lawmakers say they want to determine whether "exclusivity agreements" between mobile handset makers and wireless carriers "are restricting consumer choice."
With the U.S. Senate Commerce Committee preparing to hold a hearing Wednesday on the issues facing wireless consumers, four senators served notice that they want to probe the exclusive arrangements between wireless carriers and cell phone manufacturers.

In a joint letter to the FCC, the senators said they want to determine whether "exclusivity agreements are restricting consumer choice" of handsets and also whether exclusive deals between carriers and handset makers play a role in innovation in the handset marketplace.

Democratic senators who signed the letter are John Kerry of Massachusetts, chairman of the Senate Commerce Subcommittee on Communications, Technology and the Internet; Byron Dorgan of North Dakota; and Amy Klobuchar of Minnesota. Republican Sen. Roger Wicker of Mississippi also signed the letter.

The hearing will likely review the relationship between AT&T and Apple and their exclusive arrangement by which Apple's popular iPhone can only be offered in the United States by AT&T. Other carriers have exclusive deals to provide certain manufacturers' models, but are typically just one model in a catalog of manufacturers' handsets. The new Palm Pre, for instance, will be offered exclusively by Sprint for a short period before it will be offered by other carriers.

The senators' letter also focused on the possible impact of exclusive carrier-manufacture deals in rural America and noted that the Rural Cellular Association filed for information on the carrier-manufacturer arrangements on May 20, 2008. The senators indicated that the RCA filing has produced a valuable store of information on the issue

The senators asked the FCC to "examine this issue carefully and act expeditiously should you find that exclusivity agreements unfairly restrict consumer choice or adversely impact competition in the commercial wireless marketplace."


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