Small carriers are pointing to reports that AT&T is seeking an extension of its iPhone exclusive with Apple as evidence that the FCC should act on a Rural Cellular Association petition limiting some agreements between carriers and equipment makers. AT&T is reportedly in talks with Apple to extend the deal -- signed in 2007 and set to expire in 2010 -- for two years. "Any extension of the agreement for AT&T to market the iPhone exclusively would only prolong the harms to consumers and smaller carriers," said an attorney for small carriers. "With regulators and Congress now considering steps that could ban exclusivity agreements altogether, it seems peculiar that AT&T would try to extend an agreement that requires it to incur a huge cost to implement successfully in the marketplace. Any claim that AT&T resources were needed to bring an innovative product to the market is belied by an extended exclusivity agreement." nnCaressa Bennett, an attorney for the Rural Telecommunications Group, said: "Apple would be crazy to continue to exclusively tie itself to AT&T. It could quadruple its sales of the iPhone if it allowed all wireless carriers to sell it. Handset exclusivity does not drive innovation, it suppresses it. ... From a rural consumer perspective, it is unfortunate that rural consumers who are unable to receive ATT service are unable to utilize the iPhone. ATT does not have nationwide coverage and is reliant on rural carriers and its other roaming partners in many areas still. Congress and the Obama administration wonder why we are behind in providing broadband services in rural America. Allowing handset exclusivity certainly doesn't help the cause."
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