In the Matter of
RURAL CELLULAR ASSOCIATION
RM-11497

Petition for Rulemaking Regarding Exclusivity
Arrangements Between Commercial Wireless
Carriers and Handset Manufacturers

REPLY COMMENTS
of the
Ad Hoc PUBLIC INTEREST SPECTRUM COALITION

Handset exclusivity arrangements are harmful to consumers. These anticompetitive practices limit consumer choice, raise consumer prices, and limit innovation in the device market. The arrangements tie together the markets for devices and services, allowing the market power of wireless carriers to invade a competitive market for devices and to use successful devices as hooks to reduce competition in the wireless services market -- they function as artificial restrictions on competition in both the wireless service and wireless device markets. This proceeding raises the question of whether the Commission should remove these restrictions and open up the device and service markets, by preventing wireless carriers from interfering with innovation and adoption of wireless devices, with the intent of limiting competition over quality and price in wireless services. The Commission has the authority to enact regulations prohibiting exclusivity arrangements between carriers and device manufacturers, and to abrogate existing arrangements. The Commission should issue a Notice of Proposed Rulemaking suggesting language for rules to immediately prohibit such arrangements.

To read the full comments, please download the PDF below.