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Justice Department said to investigate AT&T, Verizon over wireless collusion claim

22 April, 2018, 01:46 | Author: Lydia Fleming
  • REUTERS  Mario Anzuoni  File

Apple (NASDAQ:) is the 500-pound gorilla behind a Justice Dept. probe of the big four wireless carriers that dented their stocks this afternoon, Bloomberg is saying, and multiple device makers are said to have complained about potential coordination. The newspaper cites six people with knowledge of the inquiry and alleges the wireless carriers worked in coordination to make it more hard for people to switch carriers.

None of the entities under investigation commented for the NYT report. The technology allows consumers to switch wireless providers without having to insert a new physical SIM card.

The investigation highlights a push by the Justice Department's antitrust chief, Makan Delrahim, to crack down on the opaque world of intellectual property, or I.P., standards.

AT&T and Verizon together account for more than 70 percent of the USA wireless subscribers.

Representatives from Verizon Wireless and AT&T acknowledged the inquiry by the Justice Department, with a Verizon spokesman telling the NYTimes that the issue was "much ado about nothing". The reason? To prevent customers from leaving their services and switching to another carrier, in which eSIM tech makes it easier for them to do so. The DOJ's investigation could show that the companies along with the GSMA were trying to influence the development of this technology in order to maintain their market dominance. The DOJ argues that the deal will hurt competition and lead to higher prices.


The source said the Obama administration had investigated similar claims in 2016 but did not take any action.

MacRumors covered Apple Watch 3 with LTE and eSIM cards having problems with AT&T going back to last September.

FBN's Connell McShane discusses the court battle between AT&T-Time Warner and the Department of Justice.

Apple and Samsung have both been pushing the telecom industry to adopt eSIM technology. The investigation may also include other major American carriers, another person said.

"There is a constant problem with industry standards-setting organizations that on the one hand allow the industry to come together for the objective of efficiency but can be very anti-competitive and operate in secrecy", Feld said.

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