Large wireless carriers such as AT&T and Verizon Wireless
often lock in exclusive deals with phone manufacturers so that they are the only carrier who offers a phone for a predefined amount of time, such as six months or a year. In AT&T’s case, the exclusivity deal with Apple regarding the iPhone
has lasted for multiple years.
Now, Verizon Wireless is giving some of the small carriers a chance to compete when they might not otherwise be able to do so. While Verizon Wireless still plans to lock up new mobile phones in exclusive contracts, the company is making an exception and letting small carriers get the phones in six months or less. With this agreement, “small carriers” are defined as those with less than 500,000 subscribers. Most of the carriers that fit this description are rural carriers.
Exclusivity arrangements such as those that AT&T and Verizon Wireless use have drawn attention from the Senate as well as the Federal Communications Commission. Investigations are currently underway. Verizon’s plan to allow small carriers to get access to new phones appears to be an effort to head off any legislation from Congress or further action by the FCC and Justice Department.
Earlier this year, Verizon Wireless offered to restrict exclusivity periods for LG
phones. Rural carriers have said the gesture was insufficient. Even though competition is stiff among the carriers, you have to think that the small carriers should appreciate the opportunity to get newer phones sooner.