paidContent - DOJ Questions Whether Mobile Operators Are Anti-Competitive
Monday, July 6, 2009; 1:29 PM
The Department of Justice has started reviewing the practices of mobile carriers in the U.S., including AT&T (NYSE: T) and Verizon Wireless (NYSE: VZ), to determine if they have abused their power in recent years, reports the WSJ, which quotes unnamed people familiar with the situation.
At this point, it's unclear how big of a deal this is. The review is in its early stages and isn't being considered an official inquiry, and no companies in particular are under investigation. However, the review likely piggy-backs on questions being asked by other lawmakers. The FCC has been exploring whether larger carriers are hurting smaller competitors by having long-standing exclusives on popular phones, like Apple's iPhone. The Justice Department may also review whether carriers are "unduly restricting the types of services other companies can offer on their networks."
To be sure, AT&T and Verizon control much of the wired and wireless market. Together, they control 90 million landline customers and 60 percent of the 270 million U.S. wireless subscribers. The WSJ said a Justice Department spokeswoman declined to comment.
If the department does follow through with an official investigation, it will likely quote the Sherman Act, which would require the government to prove that a company has abused its market power.