Exclusive deals by the largest phone companies are generating controversy in the communications world, and they should have you worried, too.

In TV, the big cable companies use their power to strike exclusive deals for cable TV channels to keep new pay TV services offered by other companies from getting off the ground. Since AT&T and Verizon are hoping to offer those new pay TV services through their UVerse and FiOS networks, they say that these exclusive deals need tight government regulation to promote competition and protect consumers.

In the wireless world, however, AT&T and Verizon sing a different tune. They use exclusive deals for popular handsets like the iPhone and the Blackberry Storm to keep customers from switching to other wireless services. Since AT&T and Verizon benefit from these exclusives, they want to convince the public that these deals are also great for competition and consumers. No need for government regulation, they say, nothing to see here.

Whether they limit access to TV content or network options for wireless handsets, exclusive deals by dominant companies mean less choice for consumers. So what’s the difference between these arrangements for cable channels and for wireless networks, according to AT&T and Verizon? They don’t say. But what’s a little hypocrisy when corporate profits are at stake?

Here’s the bottom line: When the phone companies mix their messages about exclusive deals, consumers get more than gossip – they get screwed.

Big Phone Companies Dislike Big Cable Companies’ Exclusive Deals

Using their broadband networks, Verizon and AT&T have started their own pay-TV services to compete with cable and satellite. But Cablevision has refused to sell its HD Madison Square Garden channel to Verizon, keeping New York sports events off FiOS TV service.

Verizon has been running to the government for help, filing an FCC complaint against Cablevision last week. And AT&T has been battling Cox Cable for Padres baseball programming in San Diego for years. In June, AT&T asked the FCC to reconsider its previously dismissed complaint against Cox for withholding the games from AT&T’s U-verse TV service. The FCC must regulate such deals, says AT&T, “to ensure that incumbent cable operators cannot abuse their control over critical video programming assets” like local sports.

The phone companies claim that without access to this popular programming, their still-developing TV services will die. According to Verizon, Cablevision "has bragged to analysts and the public about its anticompetitive efforts, trumpeting that Cablevision is the only HD source for four of the nine professional sports teams in the New York City metro area."

AT&T and Verizon are calling for the government to protect consumers by striking down anti-competitive exclusive deals.

But Big Phone Companies Love Exclusive Deals for Wireless Service

In the wireless realm, however, where AT&T and Verizon dominate with more than half of all customers, the companies tell a different story about their own exclusive deals.

They have locked down handheld devices like the iPhone and Blackberry Storm, making them unusable on other networks like Cellular South and T-Mobile. If a customer loves her iPhone but hates her AT&T service, tough luck: Unless she tosses out her expensive phone, she’s stuck with whatever fees and restrictions AT&T imposes. It’s a bad deal for consumers, but a great one for AT&T and Verizon.

The Phone Companies’ Double Standard

While filing complaints to the FCC about the cable companies’ exclusive deals, AT&T and Verizon are telling the government that their exclusive agreements are good for consumers. AT&T claimed at a March hearing before the House Energy and Commerce Committee that their exclusive agreements “promote innovation, product differentiation, consumer choice and competition.”

Verizon testified at the same hearing that wireless competitors seeking access to handsets in exclusive agreements “are more about seeking a Government ‘thumb on the scale’ to assist them,” than they are about serving wireless customers. This testimony sounds a lot like bragging over anticompetitive advantages – the same thing Verizon criticized Cablevision for when the phone company was looking for its own “thumb on the scale.”

Verizon and AT&T can’t make up their minds, but for consumers (and for several members of Congress) the picture is clear: In both markets, exclusive deals hurt choice and competition. Whether the scheme is to keep local sports content off FiOS and U-verse or to deny the iPhone to competing wireless carriers, the purpose is to stop competitors from providing consumers the services of their choice.

Exclusive deals in TV and wireless service boost corporate profits at consumers’ expense. It’s time we called these companies out for their hypocrisy.

Kate Aishton is a student at Georgetown University Law Center and legal intern at Free Press.