Interim Federal Communications Commission chair Michael Copps is calling for an examination of exclusive handset deals to establish if they are restricting innovation. In an informal presentation on broadband policy at the Pike & Fischer Broadband Policy Summit(pdf) Mr. Copps brought up the subject of exclusive deals and how …
Funny timing all this...
Funny that the senators and the FCC decide to look into this two years after the AT&T-Apple deal, but only days after Sprint launched the Pre. Also the fact that elimination of exclusive handset deals hurts the CDMA carriers like Sprint and Verizon much more than it does the GSM crowd - since GSM phones are much more readily available "unlocked" than CDMA equivalents.
To me it smacks of an AT&T move to strike out at Sprint and Verizon, to prevent the CDMA carriers from pulling stunts like the Gphone or Pre without AT&T being able to defeat their marketing with the same device at a lower price.
Doesn't matter that GSM enjoys a much bigger market share - let the market sort this out, not some carrier fight held in Congress...
I hope the regulators have the balls to win this one
Innovation is extremely limited in the market place right now. Exclusive deals are causing GPS to be locked down, WIFI to be disabled, and application development to be limited. The cell phone operators need to be forced to open up if true innovation can take place on top of them.
I may not like it.... but I dislike the alternative even more
When government or its agencies dictate who does busines with who and on what terms, life will be a lot worse than being forced to use a particular network if we want a specific phone model.
@Brett Brennan 1 --- Funny timing all this...
Brett Brennan 1 posts, "Funny that the senators and the FCC decide to look into this two years after the AT&T-Apple deal, but only days after Sprint launched the Pre."
Perhaps you missed that this investigation announcement is only days after Apple launched the new iPhone 3G[S] with the exclusive deal with AT&T where new features will be available to overseas customers before U.S. customers because of AT&T not being willing (to deliver services like MMS and tethering on the iPhone, when AT&T is willing to deliver them on other phones.)
The Apple iPhone can clearly deliver the services, since international carriers are offering the services, today. The U.S. AT&T customers are locked-in with no other options, due to an exclusive agreement. Apple's iPhone domestic competitiveness continues to be suppressed due to this carrier's unwillingness to offer these competitive services, solely to this single vendor's single product.
Brett Brennan 1 posts, "elimination of exclusive handset deals hurts the CDMA carriers like Sprint and Verizon much more"
It appears that iPhone is almost driving AT&T's sales exclusively... the product is very popular. A popular product offered to CDMA and PCS carriers would be a boon to those carriers!
If the U.S. FCC decides through their investigation that the exclusive deal is hurting U.S. Consumers, CDMA and PCS customers could have new options offered to them - Apple would be allowed to build iPhone variants for these other carriers, this would provide lower cost alternatives with more features to all customers, and this would also guarantee an increase Apple iPhone market share by increasing the markets it can compete in.
The timing of the investigation after the Apple iPhone 3G[S] release is unmistakable:
- AT&T is clearly in the cross-hairs by not delivering services offered to other phone manufacturers when the iPhone is clearly capable of utilizing those services on other global carriers
- CDMA and PCS carriers have more to gain than lose through increased competition with the iPhone product availability no longer being restricted from their networks by a contractual obligation
- Other mobile phone manufacturers have more to lose through increased competition due to the iPhone being legally allowed to be available from more carriers
Yes, Apple would need to create a new iPhone variant, but if more market share could be gained, I bet they would do it, considering how AT&T is not giving iPhone customers the features they gave other customers for the past 2 years!
If only ... ?
... the telcos could keep up with the hardware?
Restrict Innovation - cough! splutter!
Words fail me - at least here in the US there is virtually ZERO innovation ... just look around - the iPhone really isn't that much of an innovation (but they are working on it) compared to what could actually be done with a phone/mobile device - it's the "Osbourne: of mobile phones and that's why it's kicking the collective arses of the rest of the cell phone industry.
For the record - I don't own an iPhone. To my way of thinking the damn things are still too crude compared to what could be done if anyone was actually interested in innovation. The mobile market in the US is about where land-line phones were in the 70's - got a phone? You can only connect an AT&T approved phone to the wall and you had to call them and give them the dB number before you plugged it in.
The Mobile Phone Industry in the US is (a) overpriced, and (b) sucks.
to @Brett Brennan
"...two years after the AT&T-Apple deal, but only days after Sprint launched the Pre"
Sprint has only 180 days exclusive sale on PRE ... I don't think GSM vs CDMA has anything to do with this. These deals hurt everybody - look at Verizon with Blackberries and how many BB they sold in Q1 2009 (more than iPhone) http://www.itfacts.biz/top-selling-smartphones-in-q1-2009/12969
I'm sick of these deals, I really don't get why I cannot get $200 credit and get phone I want instead of being forced into getting few highly discounted models (assuming the phone works on the network).
Nothing against exclusivity...
...but you should be legally entitled to unlock your phone from the network you bought it from after your contract expires.