iphone 3gsWhen cell phone carriers and handset manufacturers make exclusive deals there are always losers. Sometimes it is consumers, sometimes it is the handset manufacturers, and the only solid winner is the carrier.  However, it is beginning to look like these sorts of deals may become more and more a thing of the past, but expect the carriers to fight it tooth and nail.

While this has been a common complaint of cell phone users for years now, it has picked up some significant momentum ever since the initial release of the Apple iPhone in 2007.  With AT&T having already extended the exclusive deal to 2010, and now looking to extend it even further, Senators have requested that the Federal Communications Commission (FCC) look into the impact of exclusie deals on consumers as well as cell phone manufacturers.  The three biggest areas of concern are:

  • Are rural users being shut out of the latest technology because the majors’ networks don’t reach them?
  • Do exclusive deals limit access to technology?
  • Do they discourage innovation?

While all are good questions, there are also questions of pricing being effected by the lack of competition, and the current question of overall service issues.

We already covered how AT&T was lagging behind other countries in adding MMS and tethering for the iPhone, but now the biggest complaint is just a general level of sub-par service.  MG Siegler of TechCrunch, who is possibly one of the biggest self confessed Apple/iPhone fan boys on the planet, is saying that if Apple does not break away from AT&T at the end of the current 2010 exclusivity that he will either change phones or hack his phone to work with another carrier.

Earlier this week it seemed like there was a light at the end of the tunnel as Verizon said it would end exclusivity deals after six months, but after you got past the headline you discovered it was about the most empty gesture in history.  While it is true that Verizon will allow other cellular carriers sell its exclusive handsets after only six months, it will only apply to carriers that hae 500,000 or less subscribers.  Seeing as the four major carriers (AT&T, Sprint, TMobile, Verizon) control 86% of the market in the United States, this basically that Cecil’s Rural Cellular and Bait Shop will be about the only carriers able to take advantage of this decision.

Hopefully this is something the FCC will look into, although it is surprising it hasn’t done so sooner than this.  While it is certain that the iPhone is the most obvious example of the problem, there are plenty of other exclusive phone deals that are just as infuriating, such as the Palm Pre only being on Sprint.

The best way for consumers to let the world know how you do feel about this is to simply vote with your pocketbooks.  On a personal level, I’ve wanted an iPhone since the day it was announced, but due to my deep hatred of AT&T, I carry a BlackBerry on Sprint’s network along with an iPod Touch.  Who loses here?  Well, me on one level, but also Apple as they have lost a sale.  I am not alone in my feelings so by Apple or any other handset manufacturer signing these deals, and while there is no doubt that they have made a tremendous amount of money from the device, but couldn’t they be making more if it was offered to more carriers?  Sure it was a nice deal when the iPhone needed to gain ground in the highly competitive market, the same for Palm signing with Sprint, but the launches are over, it’s time to move on, and it’s time to end those sorts of deals as a whole.

Categories: Cell Phones, Mobile Phones, Opinion   

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