Apple Can't Afford iPhone's Carrier Exclusivity 371
WirePosted writes with an ITWire article about the problems that Apple's AT&T exclusivity deal could pose in the coming years. Initially the company needed AT&T's commitment to the project, to ensure features like visual voicemail would work. With the iPhone a hit even at its current high price that no longer seems to be the case. Can Apple afford to stick to an exclusive carrier in the future? If for no other reason than consumer choice? "iPhones are being sold unlocked in the markets of Asia where you can't get them with a carrier plan, but they're also being bought and unlocked in the US and Europe. The message is that many and probably most iPhone buyers would like to be given a choice of carrier when they buy their iPhone. Some would be prepared to pay more as they do with other smartphones and buy their iPhone unattached to any subsidized carrier contract. The point is many consumers feel no loyalty to carriers and resent being forced to choose one."
Loyalty!? (Score:5, Informative)
My current carrier doesn't provide many services you can get in other areas, such as video transfer and texting outside the local area. I'm not talking about extra-cost, they simply don't offer it.
On top of all this, cell service is expensive. With these things in mind, I can't imagine how "loyalty" is supposed to even come into the equation. As far as I'm concerned, I'm just looking at which side of the ship to jump off of, knowing that the next ship over isn't likely to be any better anyway.
Another "analysis" missing the point (Score:4, Informative)
Apple is trying to upset the traditional business model for handset makers in that they wish to get a cut of recurring subscriber revenues, not just a one-time equipment sale. Apple is able to get this revenue (which in the long term means more than the phone sale!) precisely because it has granted exclusivity to a single carrier. If AT&T was no longer guaranteed to capture the vast majority of iPhone subscribers, it would neither have (a) implemented the needed Voicemail and EGDE network upgrades and the billing system+iTunes interface, or (b) agreed to give a cut of subscriber MRC to Apple.
The simple calculus here is that carriers will do special things that Apple asks for (changing the way they bill and provision customers, plus handing over a cut of service revenue) in return for Apple doing something the carriers ask for (exclusivity). I don't think anyone would sensibly argue that carrier exclusivity is in the best interest of all customers, but that doesn't mean you're really tied to it. Those with the means and technical knowledge will continue to purchase and unlock phones to their hearts' content - that's the beauty of a GSM ecosystem (well at least for 2 of the 4 main US carriers). Apple and all the carriers internationally that it deals with - plus all the cellphone users who just want all of their cool Apple features to work with a minimum of hassle - will continue to pursue the exclusivity model for the foreseeable future.
Re:All phones and all data services (Score:5, Informative)
I still don't get why the iphone is considered so revolutionary, except it's the only one that's permanently locked to a single carrier and has a ludicrously long minimum contract.
Re:No choice... (Score:4, Informative)
So Apple is supposed to violate its contract? (Score:3, Informative)
Can Apple leave its five year exclusive contract with AT&T? If for no other reason that to heed the cautionary woes of a Computerworld writer with tenuous grasp of business and markets?
The problem with wags is that they talk about Apple, Microsoft, AT&T, etc as if they were characters in a play they were writing, apparently unaware of the real world constrains of money, technology, personnel, opportunity cost, and other resources. They write like they're genus for printing ignorant wishful thinking that sounds good only if you don't know what else is involved.
Video Game Consoles 2007: Wii, PS3 and the Death of Microsoft's Xbox 360 [roughlydrafted.com]
Re:There's more here than meets the eye (Score:3, Informative)
Check my email: http://www.google.com/mobile/ [google.com] (or just go direct to the gmail site with the phone browser)
Browse the web: http://www.operamini.com/ [operamini.com] (if you don't like the built in browser)
Even visual voicemail can be simulated using MMS [wikipedia.org] (a feature the iPhone lacks).
So if my phone can do that on a pay as you go basis, unlocked and I'm able to switch** if and when I see a better deal Why get an iPhone??? And as I said mine is a cheap phone, so the more expensive Nokias, Motorollas etc. should have even more functionality, right?.
I just don't understand the hype and wish I did, so can someone tell me what's so good about the iPhone?
*cheap as in the second cheapest in the O2 shop despite that it still manages to have a stills and video camera.
**As it happens O2 have been a very good service provider and would happily recommend them to anyone. Ironically they are the company partnered with Apple here in the UK, so brand loyalty wouldn't be a problem should I wish to get an iPhone in future.
Re:Why the iPhone is revolutionary... (Score:3, Informative)
Re:There's more here than meets the eye (Score:4, Informative)
What did Steve Jobs do you to you, run your dog down? Jesus. I have my iPhone box right here. Did you know that it says you need a PC with Windows or a Mac and you need to have iTunes installed to use the product? It's not like Apple is dropping their evil proprietary software onto your machine when you plug your phone in without any warning.
Being able to activate myself is convenient. I liked that. I was an existing AT&T customer who had never had any problems with them - I've had some horrible piece of shit phone with them for five years or so before I switched to the iPhone. I've still never had any problems with them. Hell, I haven't -talked- to someone from AT&T about my service, ever. They send me a bill and I pay it. No bullshit involved.
I don't quite know why you're frothing at the mouth. Yes, there's some lock-in. That's advertised straight-up. You need iTunes; you need an AT&T contract. Don't like it? Then vote with your wallet and buy something else.
Re:iTunes shouldn't be involved. (Score:3, Informative)
The iPhone requires iTunes for activation and OS updates (which sometimes will bring significant new features, unlike nearly all other handsets), which, in turn, requires a computer, or access to one, period.
And, uh, I don't think people without computers are really the target market for the iPhone. The iPhone is part of Apple's iTunes/iPod/iTunes Store ecosystem.
(And activation via iTunes is a hell of a lot more "seamless" than the crap hassle of most activation processes, in which many people don't always understand exactly what they're getting, either, because the sales rep does this sort of thing all the time (or is clueless), and the customer doesn't. Here, see for yourself. [apple.com])
And you still can't download music over the air link, can you?
Um, yes, you can [apple.com].
And the Apple TV, with the new firmware, will also now download things directly from the iTunes Store without a computer being involved.
So while the iPhone isn't really meant to be a standalone item, Apple is indeed moving things in the direction of these sorts of devices being able to work more independent of a computer.
Re: iPhone and AT&T (Score:2, Informative)
Re:There's more here than meets the eye (Score:3, Informative)
"Stupid" describes a guy who doesn't understand why Apple doesn't just sell OS X for standard x86 PCs.
"Stupid" is a man who attributes all of Apple's sales to trendy hipsters who don't understand the True Power (TM) of Microsoft products.
"Stupid" is someone who thinks he is better than the entire Apple-buying populace but never bothers to try to explain the countless engineers and tech heads who use Apple products because they judge them to be better products.
Also, you might want to reconsider saying that Windows brought computing to the masses. It wouldn't be hard at all to argue that the Macintosh GUI (well before Windows and possibly your date of birth) made computing accessible to the masses. Though if you're just counting by install base, Windows is your champion.
Re:There's more here than meets the eye (Score:3, Informative)
Obviously I don't fit into Apple's target market (though for some reason, I still have to hear about them all the time) and my phone obviously lacks the magical "experience" of Apple - but please don't try to mislead people into suggesting that every other phone doesn't work.
Re:There's more here than meets the eye (Score:5, Informative)
I mean, are you aware of how they have been running their computer business? I'm sure that you will *say* you are very aware, and then you might begin to spew a little information that will quickly turn into a rant about how evil the company is... but just stop and think (or god forbid actually do some research) before you reply to me.
Did you know that Apple had their tentacles wrapped around every little detail involved with the manufacture and sale of their new computers for the majority of the time that Apple has been selling computers? Do you understand that this is why they are as stable, versatile, and easy to use as they are? Do you think it is just coincidence that the industry standard in professional publishing software began as "Apple Only" software? (Hint: Adobe...) Do you know that Apples were the first computers to enter into professional recording studios? Again, would you just blow this off to coincidence?
For more than a decade, while IBM users were still fooling around with DOS, MAC users were connecting to the budding internet with Prodigy or AOL or Compuserve. While PC users were trying to figure out how to get their sound cards to work, MAC users were writing music in notation on their screens and getting their "cute" little machines to play it back. And these are only some of the advances. Sure, Apple kept an iron grip on manufacturing. This was to ENSURE a quality product. And you know what? IT WORKED!
Now, personally, I've never owned an Apple. I have nothing against them, but I've never been able to afford one. I can appreciate the quality of a Ferrari without owning one of those either. Just because they are expensive, I'm not about to go on a spree hating the company.
What happens when you buy an Unlocked IPhone, and you pick your carrier, and you find that half of those nifty features that you bought the IPhone for, don't work. Whose fault is that. Is it Apples? Nope. You are the kind of person who will blame Apple, but that doesn't make it their fault. They made the phone, they worked it out with AT&T so that all the features of their phone work with AT&T as a carrier. From your argument, you don't want Apple to be dictating how EVERY other company out there that could provide phone service has to alter how their service works, just to make it compatible with the Iphone... or are you a blind hypocrite who just can't see that this is exactly what would HAVE to happen, if the IPhone was able to work with every carrier? Oh sure, Apple could lose and alter some of their features, and make their phone just like a motorola... but what would be the point?
Apple raised the bar. Plain and simple. If you don't like the IPhone AT&T marriage, DON'T BUY ONE! How simple is that? I'm not the only person to realize this. Why can't you?
You're wrong (Score:3, Informative)
Fitt's law. [wikipedia.org] You're wrong, Apple's UI team is right. Not an opinion, either. UI design is science, not opinion.
Also, Ubuntu has a very nice UI, but Windows? I remember installing a wifi card in a Windows laptop. At one point, the installation instructions told me to open the context menu on a entry in a subment of the Start menu to get to the card's properties. Really? That's less confusing than Mac OS? You're probably used to Windows and thus find Mac OS X confusing. Fair enough. For somebody who uses both regularly, the winner is obvious.
Re:There's more here than meets the eye (Score:4, Informative)
The iPhone is mediocre? Seriously? (Score:3, Informative)
As with the original Mac the raw hardware performance largely fades into the background. EDGE is slow, sure, but even in slow mode the iPhone browser beats the tar out of the using the lousy-to-the-point-of-useless browsers on other 3G-capable phones I've used. What the hell good is a fast network connection on those things, when you can't even use it?
In terms of using the thing as a phone, I figure it's worth waiting for both 3G and the AT&T exclusivity arrangement to work itself out. In the meantime it's possible to get most of the usefulness of the device without AT&T, by far the major suckage point of the iPhone, even though it does mean giving up even EDGE support. I bought an iPod Touch as a replacement for my Palm T|X, now that Apple has come to its senses and shipped it with a full set of applications. The improvement in interface versus the Palm series (a product line that has thoroughly stagnated over the last three years) is really hard to overstate. I don't know what Apple's expectation of market is, but their "music player" is the best PDA on the market by leaps and bounds. (With one major misfeature: Needs a louder alarm!) I kind of wonder if Apple might, in the years before the AT&T contract expires, produce an iTablet that is pretty much the iPhone without the phone, or the iPod Touch with cellular data support. I have a Kindle as well and the EVDO support in it is brilliant where it is integrated well (Amazon store support) even though its web browsing feature is super-primitive to the point of being a "really need to know right now" limited tool. It could be an interesting product, although perhaps not mass-market enough.
As an aside, I can only hope that touch-style UI design takes off. It's nice to see all the other vendors scrambling to make products with those kinds of interfaces, having been caught flat-footed (although you want to skip some of the other first-gen devices; the Touch phone that Verizon is selling right now ... let's be charitable and say it feels rushed). On small form-factor devices it is the difference between "works great" and "is practically unusable". Moreover I would absolutely love a 24" touch display for my desktop, that would make Photoshop way, way more convenient (mice suck, the tablet is a big improvement but it takes a lot of training to get used to writing down there while looking up here, and the Wacomm monitor/tablet that offers the best ergonomics on the market is ridiculously expensive). The interface is vastly superior to the mouse.
So, getting back to my original reason for replying, I don't see that the iPhone hardware is really all that mediocre. There are a couple of design decisions, like EDGE and the fixed battery, that annoy a subset of the population but in the greater scheme of things appear to make little real difference (especially in the US which has narrow deployment of 3G networks). In terms of display, and interface, and application performance, and WiFi networking the devices thoroughly embarrass the competition. This is so much the case that I often wonder if the people complaining about lousy hardware have actually used an iPhone. It works more smoo