Has Steve sold-out to the Telcos?
October 3, 2007
We’ve all been wondering what on Earth Apple has been thinking recently right? Don Reisinger believes its all AT&T’s fault. Has Steve Jobs finally been out-foxed by the big Telcos? Is he now at their beck and call?
Yesterday there was a rumour here in NZ that a smaller, relatively new Telco (Orcon) could be negotiating to release the iPhone rather than Vodafone (the dominant player). What this makes me wonder is just how many other Telcos around the world are already in negotiations with Apple? Is this the piece of the puzzle we are all missing?
Let’s imagine that there are 10 or 20 contract negotiations happening right now. Let’s also imagine that some of them are near closure with larger players, and substantial amounts of revenue-sharing income is on the table. Then imagine that Apple did not intentionally disable unlocked iPhones with its recent update…
Suddenly, all of these Telcos get nervous - perhaps the negotiations suddenly become rocky! Maybe… Steve gets nervous and thinks - nope, I need all these contracts finalised. Brick the phones!!!
If this was the case, there could be hundreds of millions of dollars on the table, maybe even billions over 5 years. And, Apples ’screw you’ attitude becomes a little more understandable.
If Steve is really determined to enforce the revenue-sharing model with Telcos and drive his new approach through the whole industry, then there will never be an unlocked Apple phone. In fact, his key negotiation card is going to be something like “it’s beautiful, it works flawlessly (because we locked it down so tight), and it will grow your user-base even if your service and network coverage are lousy - just look at AT&T!”
Perhaps we are doomed to doing it Steve’s way or not at all… Hmmm, that new ‘open’ Nokia is suddenly looking a lot better!
Originally from TechGripe! by Brett Ryland (3 October 2007).
Therefore a simple endgame might be that all interchangeable sim phone networks will eventually handle iphone connections, but not before single access markets are created to boost demand as much as possible, whilst we wait for more handpieces to be built to supply that demand.
The business cycle is very short for new technology and to afford the cost of the R&D for this foray into a new market for Apple, they must recoup the biggest amount they can in the shortest time before they inevitably lose the control they have upfront!
You make a valid point. Thanks for commenting…
Personally I think the ‘gray’ market for unlocked phones (albeit a firmware version or so behind) is going to be huge!
I think it’s way too hard to speculate about the telecom industry at all right now. There are too many possible futures on the horizon right now with WiMax and the 700mhz band (among others) showing promise. The telecom companies are going to have to adjust for an all ip based future and I think we’re going to see that alot of the current players aren’t going to be able to afford these adjustments. This leads me to think that Job’s hasn’t sold-out, but like any good businessman he’s hedging his bets.