July 31 (Bloomberg) -- U.S. regulators probing wireless- phone contracts will focus on markets where Apple Inc.’s iPhone and Palm Inc.’s Pre aren’t available to consumers, the chairman of the Federal Communications Commission said.

“There are markets in the country where if you wanted an iPhone, if you wanted a Pre, you just couldn’t get it -- from anyone,” Julius Genachowski said in an interview yesterday. “So one question is, is that consistent with broad consumer interests?”

The agency also will consider if innovation is promoted or hindered by exclusive arrangements such as those that limit the iPhone to customers of AT&T Inc. and the Pre to Sprint Nextel Corp. subscribers, Genachowski said.

Genachowski, 46, declined to say what the next steps will be in the investigation, which the agency announced last month after four U.S. senators asked it to examine the exclusive deals. An AT&T executive told a June 17 hearing the deals spur innovation and help lower prices. Verizon Wireless said this month that new deals with handset makers will last no longer than six months, down from one to two years for most contracts.

“Promoting competition is absolutely a main function of the FCC,” said Genachowski.

He took office June 29 as the Obama administration’s choice to head the independent agency that sets rules for telephone, cable and broadcast companies.

Fostering high-speed Internet connections, or broadband, is a priority for the FCC, Genachowski said.

“There’s absolutely a sense of urgency in Congress, the White House, here at the agency, that we need to make sure that the United States communications infrastructure is appropriate for the 21st century,” he said.

Preparing Broadband Plan

Genachowski declined to say whether the agency would seek to write new rules to ensure that Web companies treat content providers equally as it readies a national broadband plan that is due to Congress by February.

The FCC last year censured Comcast Corp. after concluding the largest U.S. cable company had interfered with subscribers’ Web traffic. A lawsuit by Comcast seeking to overturn the decision awaits oral arguments in the U.S. Court of Appeals in Washington.

“We expect to prevail,” Genachowski said.

“There shouldn’t be any doubt that the FCC will enforce non-discrimination,” he said. “The Internet needs to remain open.”

Genachowski said he has devoted time to meeting with FCC staff.

“My visits around the agency have convinced me that the agency needs to be retooled and revitalized, and that that’s not a controversial proposition inside the FCC,” Genachowski said.

‘Shortchanged’ Consumers

At Genachowski’s June 16 nomination hearing, West Virginia Senator Jay Rockefeller, the Democrat who heads the Commerce Committee that oversees the FCC, said the agency has “shortchanged” consumers. Rockefeller told Genachowski to “fix” the agency.

Genachowski said yesterday that he didn’t want to comment “on where the agency has been.”

In December, congressional Democrats said his predecessor, Kevin Martin, a Republican, abused his powers and created a “climate of fear” at the agency. Martin followed the same procedures by Democratic and Republican chairman alike, an FCC spokesman said at the time.

Genachowski attended Harvard Law School with President Barack Obama and helped shape his technology agenda. He was an adviser to IAC/InterActiveCorp Chief Executive Officer Barry Diller, and earlier served as an attorney at the FCC and a Supreme Court clerk.

To contact the reporter on this story: Todd Shields in Washington at tshields3@bloomberg.net

Last Updated: July 31, 2009 00:00 EDT