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Did Apple and AT&T Really Create a Monopoly?

Part of my THE WAY I SEE IT series, where I quick-hit a few topics per week.

This week a federal judge granted class action status to a lawsuit against Apple and AT&T. The suit claims AT&T “locked” iPhone users into a five-year contract with the carrier, despite having only signed a standard two-year carrier contract. It also claims Apple “locks” it’s devices, restricting which apps owners can actually install on iPhones. The term “monopoly” is used. (Source: Mashable)

While I can certainly relate and understand iPhone owners’ complaints about Apple and AT&T as companies, a class action about contracts and non-open source devices isn’t worthy of my tax dollars. My reasoning is based on already existing, acceptable, business practices throughout the country.

Most cell carriers have offered exclusive models of devices, and not all carriers get every device (Verizon never got the Nexus One, despite plans that it would). Some Android devices can only be found on single carriers.

Apple’s control over the app catalog system is nothing new. Was the fact they run it via iTunes not a dead giveaway that they control the content?

The iPhone has been locked (though it has been jail broken) since day one, and this, also, wasn’t a secret.

And no one is forcing iPhone users to stay with AT&T. It’s their choice to continue using the iPhone with carrier service. You can use plenty of features (just not calling or texting) without being connected to AT&T’s network.

Now, a few non-device related examples:

  • NFL Sunday Ticket. You want it? You have to subscribe to DIRECTV. It’s exclusive.
  • OnStar is a GM service. For a few years it was offered additionally, yet exclusively, through Verizon.
  • There are still exclusive programming methods and feature sets exclusive to both Windows and Mac. And there always will be.

My point is, exclusive agreements aren’t new. In fact, we lock ourselves into them (either by necessity or choice) every day. My contract with DIRECTTV is up next month, but I won’t be moving to Dish. My husband loves the Sunday Ticket. Do I feel “locked”? Sure, but it’s our choice to use the service in order to reap the benefits we want.

I had considered the iPhone (Palm’s webOS wasn’t out yet), but nothing was convincing enough for me to leave my current carrier (that, and my husband refused to let me get a phone we couldn’t insure at the time). Most of my iPhone-toting colleagues did switch carriers – hesitantly – and affirm that if the iPhone ever expands beyond the reach of AT&T, they’ll switch.

From what I can tell, the issue on the contract is really with AT&T’s service. But is there a monopoly here? I don’t see it. If there is, then thousands of other companies are to blame as well.

I’ll leave you with something TO complain about:

In 2006 we purchased a new Mac (latest and greatest) and the HD version of Final Cut Pro. Months later, Apple began shipping Macs with the Intel chipset. We would have liked to upgrade to the next version of Final Cut but found that upgrading OSX wouldn’t cut it. Nope, we’d have to be another new Mac. So this Mac – advertised as a machine built to long outlast any PC (and cost more than twice as much) – soon became a dinosaur because upgrading software itself would require purchasing all new hardware.

And, a question:

At what point do we weigh what a company has done to us against what they’ve done for us, and decide if we should actually be supporting them? I don’t know about you, but if I felt duped this badly by any company, I wouldn’t just be wanting to switch carriers, I’d be switching devices.

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Written by:
Pamela Hazelton
Published on:
July 13, 2010
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See more in: The Way I See ItMore about: Apple, AT&T, iphone, mobile apps, smartphone, Technology

About Pamela Hazelton

Avid writer. Business marketing and ecommerce. Contributing Editor to Practical Ecommerce & writer on Medium. // Reward yourself a little every day.
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