MacDailyNews - Where Mac news comes first

 MacDailyNews Poll

Deal of the Day

5 Day Most Commented

Opinion Archive

Current Headlines

Latest Joy of Tech

  • Latest Joy of Tech!

MacNN

AppleInsider

Macworld UK

TUAW

MacRumors

Yahoo! Finance AAPL

iTunes Top 10 Albums

Mac OS X Downloads

Sun, Mar 21, 2010 - 08:58 AM EDT  —  AAPL: 222.2499 (-2.4001, -1.07%)  |  NASDAQ: 2374.41 (-16.87, -0.71%)

U.S DOJ opens review of AT&T - Apple iPhone exclusive deal
Monday, July 06, 2009 - 03:04 PM EDT

"The Department of Justice has begun an initial review to determine whether large U.S. telecom companies such as AT&T Inc. and Verizon Communications Inc. have abused the market power they've amassed in recent years, according to people familiar with the matter," Amol Sharma reports for The Wall Street Journal.

"Among the areas the Justice Department could explore is whether wireless carriers are hurting smaller competitors by locking up popular phones through exclusive agreements with handset makers, according to the people. In recent weeks lawmakers and regulators have raised questions about deals such as AT&T's exclusive right to provide service for Apple Inc.'s popular iPhone in the U.S.," Sharma reports.

The scrutiny of the telecom industry is an indication of the Obama administration's aggressive stance on antitrust enforcement. The Justice Department's antitrust chief, Christine Varney, has said she wants to reassert the government's role in policing monopolistic and anti-competitive practices by powerful companies," Sharma reports.

"The statute that governs such behavior – the Sherman Antitrust Act – was used by the government in cases against giants ranging from Standard Oil to Microsoft Corp. But it lay essentially dormant during the Bush years, with the agency bringing no major case," Sharma reports.

Full article here.

[Thanks to MacDailyNews Reader "Robert S." for the heads up.]

Bookmark and Share

Always -- Free ground shipping with orders over $50 at the Apple Store.

Reader Feedback: = registered.
Unregistered users: Feedback from multiple usernames are subject to deletion. Off-topic and posts from suspected astroturfers will be removed.

Reader feedback page 1 of 1 pages:
Jul 06, 09 - 03:18 pm Comment from: deepdish

If Apple were forced to allow any and all carriers to carry the iPhone, will all of those carriers be able to support all of iPhones features? ie visual voice mail

Jul 06, 09 - 03:21 pm Comment from: Zeke

As Br'er Rabbit said: "Whatever you do, don't you throw me in that there briar patch!"

I can hardly wait for the DOJ to "force" Apple to dump its exclusive deal with AT&T;. I'm sure that deep down, Steve feels the same way.

Jul 06, 09 - 03:23 pm Comment from: silverhawk

I can't see how a monopoly exists when one is GSM and one telco is CDMA. They both have large portions of the mobile telephone market as a whole.

Jul 06, 09 - 03:23 pm Comment from: blah blah blah...

this is BS. Apple and at&t;doesn't control the cell phone business. Yeah they have the most popular item out there, but that is due to their insightfulness on what can be done. It's not their fault they became the most WANTED item out there, not NEEDED. This absolute bullshit at its best for the government to be in every market watching over your shoulder.

Cell phones aren't cheap, go out and try to buy a POS blackberry outright and see how much they charge, exclusive deals help the customer bring down the cost for a service they were going to pay for anyway. Now we just got a bunch of cry babies who want what the neighbor's have and will kick and scream till they get it. If we go after at&t;and apple we better go after wal-mart for making deals with several companies to keep their prices down too, cuz smaller stores can't make the same deal.

Jul 06, 09 - 03:25 pm Comment from: Zeke

@deepdish:

"If Apple were forced to allow any and all carriers to carry the iPhone, will all of those carriers be able to support all of iPhones features? ie visual voice mail"

That would be up to them, wouldn't it? If they want to stay in business they would want to offer the iPhone. If they offer the iPhone without important features that's their choice. Customers can simply go elsewhere. I love it.

Jul 06, 09 - 03:40 pm Comment from: ecrabb

Apparently, Apple would also be forced to modify its hardware to work with a CDMA radio system and forced to modify its software to work with whatever back end a given wireless company uses.

Where do you stop with this stuff? Can we then force Autodesk to make AutoCAD for Mac? How about forcing Apple to make Final Cut Pro, iLife, iWork, and all its other software products for Windows. How about OS X for non-Apple hardware?

This isn't even what antitrust is all about! There's nothing monopolistic or cartel-like about the AT&T;/Apple exclusivity agreement.

So, I guess the DOJ will also be investigating the exclusivity agreement between Universal and Burger King to market Transformers crap to fast food customers. Why stop there? Shouldn't Universal be forced to allow other studios to make Transforms films? Why should Universal be the only studio with the hugely successful franchise? I say that with, as MDN would say, dripping sarcasm.

Jul 06, 09 - 03:46 pm Comment from: grok

This has nothing to do with "hurting smaller competitors". No doubt Verizon and the other 'big competitors' are whining to DOJ and anyone else who'll listen, while failing to mention that they stupidly and stubbornly turned down the iPhone when they had the chance.

Jul 06, 09 - 04:02 pm Comment from: Macinfo

I personally don't want Government, specially this one, telling one more company how to run its business.

I say, let the market sort it out, the deal wraps up sometime soon anyway, and has escape clauses I am sure if the need arose.

Wake up America, When has government done "anything" efficiently, "ever"? And now they want to run healthcare, banks, car companies, and force Telecomm how to do its job, its just a major recipe for disaster.

Jul 06, 09 - 04:13 pm Comment from: TowerTone

I personally think that Toyota should be forced to let Chrysler sell Camry's.
I mean, what good is a Car Tsar if he can't swing the 'Big Deals'...?

Jul 06, 09 - 04:25 pm Comment from: MacDave

I'm locked into an exclusive deal with my wife. Wait, where am I going with this? Uh, forget I even said anything....

Jul 06, 09 - 04:34 pm Comment from: TowerTone

I imagine when 4G (LTE) comes out, the iPhone will move to this mode and will be available to all carriers supporting that standard.
And iChatMobile.

MacDave
Are you sure she is, uh, holding up her end of the, er, contract for you exclusively?

Jul 06, 09 - 05:03 pm Comment from: MacDave

Nice to have you in the house TT.

And to answer your question, she is, as far as I know. After all these years, we're still on the same wavelength. wink

Jul 06, 09 - 05:26 pm Comment from: Thomas Jefferson

Everything this government touches turns to shit; keep you incompetent hands off my iPhone!!

Maybe the government could sponsor it's own iPhone; I bet it would do a good job. I bet it wouldn't spend $3 billion on a piece of shit like this:

http://www.engadget.com/2008/04/03/census-bureau-goes-forward-with-plans-to-ditch-pdas/

Oh...wait...it did!!

Jul 06, 09 - 05:35 pm Comment from: TowerTone

MacDave
How did you know I was in the house?
Wait a minute, she told me that light was ALWAYS red on the camcorder....wink

Jul 06, 09 - 05:47 pm Comment from: breeze

It's be a win/win situation for Apple.

I would imagine though that if exclusivity was broken, only vendors capable of supporting Apple's hardware at the same high standard required from AT&T;would be in the running...

Jul 06, 09 - 05:48 pm Comment from: The Real Rob

@ Thomas Jefferson

"Everything this government touches turns to shit."

Does that include our military? Because last time I checked, this governments runs our military and it is the best in the world. Are you implying our military is equivalent to dog excrement? If so, I and everyone else on this board await your apology to our troops.

Jul 06, 09 - 06:20 pm Comment from: Deus Ex Technica

"Among the areas the Justice Department could explore is whether wireless carriers are hurting smaller competitors by locking up popular phones through exclusive agreements with handset makers..."

The iPhone wasn't popular when Apple & ATT struck their agreement.

Jul 06, 09 - 06:42 pm Comment from: Thomas Jefferson

@Rob

I differentiate strongly between the Military and the civil authority, or government, under which it suffers.

As one who never misses the opportunity to stop a uniformed soldier and thank them for their service or pick up their beer or dinner if I see them eating in the same establishment, I agree with your statement they they are the best in the world.

Hope that clears things up for you.

Jul 06, 09 - 06:45 pm Comment from: Jubei

What a waste of taxpayer dollars. In the meantime there is still that company that has a monopoly that is allowed to continue. Allowed to develop web technologies to lock in users by forcing their barf enducing browsers on them. A browser that will only work with their poop inducing OS. Stop wasting taxpayers money and do your job.

Jul 06, 09 - 06:47 pm Comment from: MacDave

TT. Very nice. Touche´

Dammit, where is Ampar when I need a clever response.

By the way, when my wife and I watch her home movies, you have the oddest look on your face. You should loosen up a bit. Also, I recommend a loofah for those blemishes on your backside. :p

Jul 06, 09 - 06:54 pm Comment from: BC Kelly

To everyone who believes ...

"Government is the problem, not the solution"



Well, when it came to Microsoft's punishment for its Monopoly Abuses

Yes, you're right



BC


Oh and p.s.

Next time you need a Cop or your house is on fire

We'll let you handle it on your own

wink

Jul 06, 09 - 07:02 pm Comment from: tpmchugh

The law of unintended consequences –

Will all these other companies subsidize the iphone (since they will have less incentive if everyone can carry it)? Will you be willing to pay the $500 - $600 price for an unsubsidized phone. Be careful what you wish for...

Jul 06, 09 - 07:03 pm Comment from: BC Kelly

And to Macinfo


You say ... "let the market sort it out"


Yep, we've all noticed the fine job of "sorting" they've done in recent years



BC

Jul 06, 09 - 07:41 pm Comment from: The Real Rob

@Thomas Jefferson

We're in agreement then about the high quality of our military. Thus, considering the military is fully government funded, owned and operated, it's only logical to conclude that our government has done a good job in this particular area (defense). It would stand to reason, then, that our government is indeed fully capable of doing something right. Would this be a fair statement?

Jul 06, 09 - 08:20 pm Comment from: IndyMac

@BC Kelly

There are things the government is supposed to do and things that it's not supposed to do. This is clearly spelled out in the constitution. Local governments, in turn, are charged with keeping the peace (police, fire, etc...). The government is not granted rights to tell companies how to conduct their business.

I'm all for Apple selling the iPhone through every cellular carrier on the the planet. But, Apple should have the freedom to make that decision not the government.

Why have so many people become supporters of the government taking away our freedoms? The freedom to conduct private business... The freedom to keep the money we've earned... The freedom to fail.

It is truly a sad day when citizens support government seizure of our rights.

Jul 06, 09 - 09:03 pm Comment from: Thomas Jefferson

@Rob

Nope.

Time and again, our civilian authorities have proven that political ambitions blind them to the military advice they are given. Most recent case in point...Rumsfeld and Iraq. Military advice was that IF we were to go in, we should go in heavy and not allow any oxygen to ignite insurgents. Rummy liked the pretty lights of shock and awe.

In short, our Military excels despite, rather than because, of its civilian authority.

@BC

I'm not sure if that was directed to me or not, but IndyMac sums it up well. Local government for local issues. The Federal Government screws up everything it touches with, I'll add in deference to Rob, our Military. Need another example, google up No Child Left Behind -- disaster.

But to the point of this post, Verizon screwed up and now they are whining about it. Tough shit; next time maybe they will not be so arrogant. AT&T;rolled very expensive dice on Apple and Steve Jobs despite Apple never having produced a phone. Further, AT&T;invested in changing their infrastructure to support visual voicemail, and entered into an unprecedented service revenue sharing agreement.

For that risk, they got exclusivity. If you want an iPhone you go AT&T;. That risk has proven a wise one and both companies prosper.

The federal government has absolutely no business sticking its fingers into a contractual arrangement between two companies who both operate in vibrant and highly competitive industries.

Next thing you know, President Obama will have appointed another unconfirmed Czar with unconstitutional powers. iPhone Czar...yes...that does sound nice. Maybe he or she will determine what Apps I should install?

Jul 06, 09 - 10:46 pm Comment from: BC Kelly

Some of you - in particular the recent posters since my last post - apparently are either "young" or haven't learned much History, or both.

Is nice of you to speak well of the Military.

How many of you have Served ?

How many of you have been under fire ?

How many of you faced the Draft ?

And not talking about Registering, but the REAL Draft, which hasn't happened since early 70's.

Yea, what I thought.

Talk is cheap. So put your life where your mouth is mad

Or stfu wink



Granted, is not your fault you're probably only 30-something, maybe 40ish at the most, but beware thinking you have things figured out about what is what and who's screwing who.

For your entire lives you've been under the Reagan Myth, which is what got the ball rolling 30 years ago to the Situation we're now in. Sorry you've been led down this dead end street as you were raised and came of age. I won't try to write an entire book here to explain this concept, but let me invite you to do this ...

Go to this address and see this video

http://www.pbs.org/moyers/journal/08152008/watch.html

Is Bill Moyers interviewing Andrew Bacevich, last summer.

Is helluva summary of the past 30-40 years of US History.

You watch it. Watch it all. Takes about an hour or so. Hope you have the attention span.

Once you've done that, then come back and we'll continue our discussion.

grin


BC

Jul 06, 09 - 10:57 pm Comment from: rahrens

@TJ;

You make a pretty blanket statement there, "The federal government has absolutely no business sticking its fingers into a contractual arrangement between two companies..."

And it is completely wrong.

Yes, the Federal government has the authority, in the constitution, to govern interstate commerce. That gives it the authority to tell private, and public, companies how to run their businesses.

The Sherman Anti-trust Act was passed and signed into law to control the large nationally prominent companies that had monopolized huge markets in the 19th century with anti-competitive practices that had locked out legitimate competition by leveraging those monopolies.

The current action by the government is to simply examine the agreement between Apple and ATT to make sure it is in compliance with the law. If it is not, that agreement may not be abrogated, it could be simply altered to bring it in compliance. Total abrogation is not always the answer.

The government cannot FORCE Apple or any other company to sell their products in a manner that is harmful to them, but they CAN abrogate a contract that is illegal, or simply abrogate illegal clauses. Other provisions of those contracts would remain in force.

Would this force Apple to sell to other companies? No. It WOULD allow Apple to do so if it chose to.

How this would alter the contract is the business of lawyers to decide.

Jul 06, 09 - 11:24 pm Comment from: Air Force Architecct

@Thomas Jefferson and @ The Real Bob

The military is clearly defined in the constitution. The Tenth Amendment supposedly limits the Federal Gov to what is enumerated in the Constitution, if not it is reserved to the States or to the individual. Hmmmmm! Where does the good ol' constitution give the Federal Government the power to fire CEOs, nationalize auto makers and banks, and, in this case, approve a business plan? Oh, that's right, they did approve the very successful plans of Freddie and Fannie.

Guys, just the constitution, nothing more, nothing less

Jul 07, 09 - 03:50 am Comment from: Macdoc

The DOJ needs to be spending their time looking at members of congress that don't pay their Taxes!

Jul 07, 09 - 10:19 am Comment from: Thomas Jefferson

@ Air Force Architect - Amen

@ BC - Since it was Moyers, was dubious, saw it anyway, disagree with 90%

@ Rahrens - The authority of which you speak stems from the commerce clause which states, "To regulate Commerce with foreign Nations, and among the several States, and with the Indian Tribes;"

The term "regulate" as used when drafting the Constitution meant "to make regular..." As in keep the trains running on time or to keep your poop flowing, hence the phrase, "Are you feeling irregular..."

It has become an abomination under which a Federal government, designed to be constrained, laces tendrils into every aspect of our lives.

You are also wrong in stating that the Government cannot Force companies to do things. They can, and do, quite frequently. The Sherman act isn't remotely germane to the issue at hand in that there are multiple carriers serving multiple markets offering multiple devices. The fact that no one has been able to make a device the public wants as much as the iPhone is a testament to Apple. Maybe LG, Samsung, RIM, etc should make better things and get their own exclusivity agreements. If people then consider their iPhone to be crap by comparison, then they can switch back to Verizon which can enjoy the fruits of their risk.

That would, of course, require these other companies to be innovative, invest massive R&D;, and execute on a business plant. Things we evidently don't value as much any more.

It will be far better for consumers to have the current arrangement continue to kick the arses of both carriers and handset makers, until the latter produce competitive devices.

Consider this...replace SmartPhone with Operating System, and Carrier with Platform. The last time we had one dominant force we ended up with Windows running on 90% of PCs.

We need RIM, Palm, and Google to be pressured to improve based on the embarrassment Apple continues to make of their former dominance.

More than that, we need our federal government to get back to it's more limited role of: taking over whole industries, giving trillions of non existent money to wall street, supporting eminent domain that displaces families from generational homes, rationing healthcare, and crushing our economy with draconian special interest laden energy proposals...it's what their good at.

Jul 07, 09 - 01:03 pm Comment from: BC Kelly

Thomas Jefferson

Nice of you to share your feelings about Moyers

What does he have to do with it ?



But, you want to disagree with 80% of what Bacevich says ?

Careful kid, you probably couldn't carry his briefcase

And if you don't want to look like a total idiot ...

Then YOU better write a book here to back up your statement with facts - supported by a LOT of personal history and life experience brought to this discussion in order to have any credibility.

Dig ?

Otherwise you're just a Rush Limbaugh or Sarah Palin

Talking a lot but saying nothing

wink


BC

Jul 07, 09 - 01:03 pm Comment from: Hugh Jass

I call this action by the feds poetic justice....

I'm sure SJ and many on the Apple campus voted for the clowns in the current administration....

As one poster stated above "be careful what you wish for", I say; indeed.

Jul 07, 09 - 02:07 pm Comment from: The Real Rob

@ Thomas Jefferson

"In short, our Military excels despite, rather than because, of its civilian authority."

That's scarily wrong. Civilian oversight is fundamental to having a successful military; there's a reason the founding fathers set it up that way. Can you imagine the problems that would be caused if we had a military that could do whatever it wanted without any oversight? If it had full power over all strategic decisions regarding defense? Our military is great at its job, but I don't want unelected generals deciding when to go to war. That's a frightening thought.

It's the same principle with large corporations. If they're allowed to do whatever they want, bad things happen. That's why we have government. The JOB of government is to regulate and oversee our society to make sure corporations, military, etc. are not overstepping their bounds. The government is by and for the people, designed to act in the best interests of the citizens of our country. Obviously it doesn't always succeed; but more often than not it does, which is why we have such a high standard of living and why we live in the greatest country in the world. I'm extremely thankful we have such a good government in the USA.

Jul 07, 09 - 03:35 pm Comment from: BC Kelly

The Real Rob


You ask ...

"Can you imagine the problems that would be caused if we had a military that could do whatever it wanted without any oversight?"

Don't have to imagine, we see it now in the Current Situation™ which has developed over the past 40 to 50+ years, due - in large part - to Military/Defense spending reaching into the Trillion$ and Trillion$

And by the rise of Companies like Microsoft who've given false promises of the Future, but only wasted our National Resources and led the blind into further darkness.

We're reaping what we've sown.



But you add ...

"The government is by and for the people, designed to act in the best interests of the citizens of our country."

Can be argued our Government, during these past 40+ years, has NOT acted in best interest of the citizens, but of those who've profited from those Trillion$ - then used that profit in their own interest and not for the Common Good (and not talking about Welfare Moms nor Social Security recipients)

Perhaps now the America People are waking up to that fact and will return to the Promise of what is possible.

As someone said along the way (sorta) ...

The only problem with Democracy is the People get the Leaders they deserve



Now, don't anyone give some "Obama Rant" in response

Come back in 4 or 8 years, then we'll see

And compare and contrast them to the previous 8

Or 28 of the last 40


BC

Reader feedback page 1 of 1 pages:

Always -- Free ground shipping with orders over $50 at the Apple Store.

Add Your Feedback:

Register or Login

Name:

Email: (optional)

Emoticons | Allowed HTML Tags

Remember my info   Notify me of follow-up comments?

Please enter the "MDN Magic Word" you see in the image below: