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Apple Turning Cell Phone Market Upside Down?
joek writes "This MacRumors analysis puts some of the iPhone/Cingular pieces together and suggests that Apple may be turning the the cell phone market upside down. Everyone assumed that Apple's $499/$599 prices for the iPhone was subsidized by Cingular. But, it appears that Apple is not allowing mobile carriers to subsidize the iPhone. Why? Because when Apple comes out with the Touch iPod, they don't want it compared in price to a discounted/subsidized iPhone. Add to that rumors that Cingular may heavily discount service (but according to a Cingular rep, they will not be giving away service, as previously suggested) to attract Verizon customers. Without kicking in $100-$200 against the price of the phone, Cingular can discount the service as an incentive. Other cell phone manufacturers will certainly be interested in the outcome of this new model."
But anyone with a scanner can tune in and intercept your calls. Amateur license forbids encrypted communication of any kind.
I wonder if I use bold in my signature, people will notice my posts.
And as I should note, We hams use distance of the wave to indicate frequency. 2 Meters is 144-148MHz, and .7 Meters is 420-450 MHz . The reason I specify a distinct band is that our rights only extend in those bands (and not, say 143.8 MHz or 452.1 MHz).
To grasp what rights we ham operators have, look at this PDF CHART to understand the spectrum here in the US.
I don't see myself leaving T-Mobile which I am perfectly happy with and switching to Cingular/AT&T. I have 5 lines on a family plan with T-Mobile. No one wants the freebie phones so the cost to switch is even greater than just the iPhone price which is a big obstacle already. And imagine if others on my plan wanted iPhones as well. Just not gonna happen.
Without kicking in $100-$200 against the price of the phone, Cingular can discount the service as an incentive.
Okay, everyone who thinks this will happen, raise your hand. Nobody? That's what I thought. Cell phone companies do not base the price of their service on how much it costs them to provide it (including the cost of the phone). Rather, they price their plans purely on how much people are willing to pay. As long as people are willing to pay exorbitant amounts to lock themselves into multi-year contracts, the cell phone companies will continue the practice. And if you're willing to pay $500 for the phone, chances are you'll be willing to pay full price on the plan.
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I never wanted/needed video camera, mp3 player or camera on my phone but I always wanted cheaper service and shorter term contract. I realize that iPhone has all of these things, but I'm hoping that service-discounted business model will succeed and move to other offerings, so we finally can get affordable no-frills phone and basic service for cheap.
That Apple (and Apple phones) would not be contractually (for Apple, anyway)tied to Cingular.
Best Slashdot Co
The real Ralph Yarro posts as Anonymous Coward. Anyone else is an impostor.
What makes you think that Cell Phone conversation is safe as well? We just understand that it all is open, whether the laws prevent "listening" or not. Encryption and obfuscation can be cracked, so whats the point. Just dont say things that are inappropriate.
Since the phone is not subsidized, there *should* be no 2 year contract requirement. That would really spur competition among the mobile carriers if people weren't forced to stick around for 2 years under penalty of paying full price for their phone. Of course the fact that some use CDMA and others use GSM complicates this a bit - we need phones that support both for true service portability. In fact, a *smart* carrier would offer either non-subsidized phones at a monthly service price of X, or subsidized phones at a monthly service price of X + Y (where Y basically recaptures the phone discount over the life of the contract).
The more you regulate a company, the worse its products become.
While interesting, that's just not feasible for the 99% of the rest of population, hence why we still have phone and cellphone companies.
Do you lock your doors at night? Because I can zip through that lock in 2 seconds, and if I can't, you have some mighty nice windows. Therefore, what's the point? In fact, might as well remove the door altogether.
I wonder if I use bold in my signature, people will notice my posts.
I think if the phone itself is going to cost lests say $600 and its not being subsidized by cingular, it should mean the ipod videos are going to cost much less.. I am still considering it... I dont mcare mouch about the pphone but i really want the resat of the features.... either way its a sweet deal.
Nom de dieu de putain de bordel de merde de saloperie de connard d encule de ta mere.
If Cingular cannot subsidize the phone, then why did Apple give them the exclusive and require that all customers sign two year contracts? Usually the two year contract requirement is to pay back the subsidy... without the subsidy, there's usually no incentive to sign a contract. If that's the case, I think Apple botched this one for the customer.
--Aaron Greenberg
It isnt? Check out ARRL.org
Technicians Handbook: 25$
FCC Tech License test: 14$
2m/70cm radio : 150$
Unlimited geographical talking area with no contracts: Priceless
And now, the FCC has eliminated Morse Code from every test, so all you need is basic RF and electronics theory. Easy stuff.
This is based on an idiotic misreading of a hearsay forum post. A guy says in a forum post that he heard from a friend at Roger's that they will be offering the iPhone in Canada. This was later confirmed by other sources. The article writer then seizes on this (totally unconfirmed) part of the forum post:
"Apparently, the prices won't be much higher than the US versions (just currency conversion I guess) and that they aren't allowed to subsidize the cost of the phone relative to your contract (ie you won't save more by signing a longer contract)"
What he obviously is trying to say is that the service providers aren't allowed to vary the subsidy on the iPhone price with different-length contracts, changing Apple's chosen iPhone price point, not that the fixed iPhone price isn't subsidized by the service providers. This is totally non-surprising. It is almost certainly true.
The stupid reporter, however, took this to mean something ridiculous: that the iPhone price isn't subsidized by the service provider at all, and apparently Apple was totally happy to lock the iPhone sales to a few providers who won't sell it unless it's tied to with a years-long contract, despite those providers kicking in no part of the hardware expense. This is shocking and makes no sense. It is almost certainly false.
Because it's more or less guaranteed that somebody is going to be listening to your QSO on the radio, but less likely (not impossible) for them to listen to the cell phone conversation. Plus, 70cm (with typical power) is going to transmit a bit farther than a cell phone at a higher frequency and tens or hundreds of milliwatts.
I think phone patches are cool, though I've never used one (I am a ham). But I don't see them as any sort of replacement for mobile phones. Plus, you can't use amateur frequencies to run your business, so any type of commercial communication is right out. No profanity (on both sides), no commercial communications, absolutely no privacy whatsoever, half duplex, and you're still going to need a phone line at the other end to communicate on the PSTN. No, not a replacement.
First off, obviously there is no such thing as the phone company subsidizing phones. You're the one paying for it (via installments and higher phone rates).
.. we can slowly move away from vendor lock in. And that means you can hax0r your phone and put your own ring tones and custom applications. Maybe you can add home automation features to your phone? Would be nice to turn off the lights that way etc. Maybe turn it into a TV remote control too? Maybe have a single phone that can switch carriers on the fly (wifi to CDMA to GSM etc). The possibilities are endless.
.. you can finally do more crap with it.
Anyway pedantics of semantics aside I been waiting for this one. With subsidized phones, the carriers locked up mobile phones. But if they aren't subsidizing the phones
The point is, since you own the device
http://www.companyfuckups.com/
Do you mind if others make calls through your autopatch?
Well, if the criminals bodies are being propagated throughout the house, there'd be no need for locks.. However people arent EM.
The difference is each cell phone and tower emanate strong signals in which go through almost everything, including your property. The difference is you can build a radio that picks up this signal from inside your house, vs some weird-ass story of locking windows. The bad part is that Congress made it illegal to "pick up 800 MHz cell data". This is a legal block, not a technological block. Now, if the cell phones rotated a cipher every 2 seconds, then maybe we'd have a stance to go by, but they dont.
Why do we need a license for that?
As long as you don't interfere with someone else's communications, there's no need for a license.
Big Brother is bad enough with not allowing encryption, but requiring a license, well that itself was the foot in the door.
--- Grow a pair, liberals... stop letting the Republicans bully you!
Ummmm, I'm on Verizon and Cingular would need to dangle a heck of a lot of discounts to make me want to drop 600 bucks on a phone, switch carriers, PLUS pay for a service plan. Not the least of which would be steady coverage EVERYWHERE I go. The main reason I stick with Verizon is that pretty much everywhere I've gone, Verizon's coverage will work where others won't.
Add to that the cost of a tower on the end with the repeater or phone patch (since it's going to need to be high enough for you to get to it from a reasonable distance), the cost for the phone lines themselves, worrying about it all getting zapped by lightning when a storm is brewing, etc. Is it a cool thing? Sure. But it's hardly a replacement, especially not for the majority of the population.
I think an interesting move may be for Cingular to offer to pay the Early Termination Fee (which happens to be in that $100-200 range) for people who'd consider getting the iPhone but are stuck with another carrier. Obviously they'd need other incentives for customers not in that situation, but I definitely think that would be a big shot against Verizon, etc.
Sadly, PS/2 was yet another victim of USB, which doesn't care what you plug into it, the electrical slut.
There was no subsidy, but there was a considerable amount spent by Cingular updating their software to support things like the visual voicemail and other new and innovative features that you can only get with the iPhone. The 2 yr contracts will help them recoup the development costs for this effort.
The current system essentially amounts to anticompetitive bundling. It frosts me that I cannot take "my" phone with me if I change carriers.
It also makes the overall package so complicated that it's fairly hard to make a cost comparison between competitive carriers.
It also creates an incentive for bloated, overly complex phones since it is in the carrier's interest to be certain that you are capable of using any cost-added services they provide.
Just as Consumer Reports advises that you should always negotiate car price, car financing terms, and tradein as separate deals, what I want to do, and what I think is best for the consumer, is simply buy my phone as a separate transaction from buying service... and be able to change carriers whenever I feel like it, while continuing to use the same instrument.
If the iPhone moves us toward that model, good.
"How to Do Nothing," kids activities, back in print!
Cingular will sell the iPhone for "full" price, and give you some sort of rebate for contract of service, would be my first guess on how they handle it.
If this is true, and the pricing will be based on the actual cost to produce them and the number sold will be determined by how many people are willing to buy them at that price (supply and demand, anyone?) without all sorts of shell game market manipulation, the headline should read:
Apple Turning Cell Phone Market Right Side Up
It's sad that we've gotten to the point that a rational straight forward pricing model, without games, is considered "upside down."
--MarkusQ
They may have botched it for the customer, but it's sweet as all get out for them and Cingular.
And who do you think they care more about? heh
I just don't get it, if cingular is not subsidizing the phones then why any contract at all? It makes no sense since they would have greater market penetration with a more open phone. Unless of course Cingular is paying them a kick back on each service package sold. This would be a back door way of subsidizing without actually saying they were subsidizing.
I'm a fiscal conservative, it's a pity we don't have a political party anymore
Apple didn't do this for you. Apple did it for *Apple*. Cingulattr did it for Cingulattr.
You are merely a pawn with disposable (heh) income.
The barrier to getting people to sign up for wireless service (or a lot of other subscription services) has always been equipment cost. Even though a customer is likely to pay $1k or more in service fees over the course of a 24-month contract, consumers focus on the $300 upfront for the phone, not the monthly fee. Cut the phone price, and more people sign up.
BTW, for you folks who don't want to sign up for a contract, you don't have to. Get your own phone (paying retail price), and Cingular or Verizon or Sprint will put you on a month-to-month contract, no problem. There's no way the economics work, though, to have free RAZRs and no contract.
Nope. If you acquire a phone by yourself, and sign up for a plan with an unlocked phone, they'll still lock you into the exact same contract. I'm not really sure sure why, they just do.
First, this is not flamebait. I think the iPhone looks beautiful and I genuinely
adore everything Apple does from a visual perspective.
But...
For all of Apple's design strengths, physical UI is not one of them. I could go into
a million examples but take Apple's history of the mouse for one: Sure, Apple pioneered
the original mouse. But Apple's desire for minimalism ultimately hurt development. The
physically contoured 3 button wheel mouse looks hideously complex compared to all of Apple's
designs which have ranged from the "hockey puck" iMac mouse, to the multiple single-button
ultra symmetrical designs they've come up with. But truth be told -- I use a 3rd party
logitech mouse because its just plain superior in terms of interface.
You can look at the history of Mac keyboards and reach similar conclusions. (Although my
clear acrylic keyboard looks sweet, its just not as usable as the 3rd party, uglier,
keyboard that I use).
So, back to the iPhone: There's no keyboard. Yes, there'll be an onscreen keyboard. Will
this be usable? Will it be as good? No one actually knows yet, but I'm going to have to
guess "no" on both counts. Sleek minimalist, symmetrical design is fantastic (and I've always
been a big fan of it). But the reality is that human beings aren't sleek, minimalist and
symmetrical in their UI needs. We're multi-digited, mono-dextrous creatures with clumsy
fat appendages and pre-wired for physical feedback.
Ultimately I think the iPhone is going to be one hell of a sexy device, but I don't think
its going to have any place in my life because I "live" on my Blackberry, and its a workhorse.
I wish it weren't the case because I'm a sucker for most things Mac in terms of design
and aesthetics. But this is about my fingers and my messaging. And, well... neither of those
things is terribly sexy.
------ The best brain training is now totally free : )
So the $499 / $599 isn't subsidized, so why the hell are people going to be stuck in 2 year contracts? So they get a phone for a primium price AND locked into a 2 year contract. Doesn't make any sense, one or the other.
I have no doubt the integration between Macs & iPhone is going to be ABSOLUTELY UNBEATABLE. I know Apple will keep the interface simple, even though I know they will upgrade it over time, I know from experience, I can rely on Apple to DELIVER easy to use functionality. I don't have countless hours to study new equipment and software for dozens of hours a month.
I have had so many phones that had crap that didn't work, every new phone had a different keypad buttons and menus & icons, and menu structure, and non were consistent or easy to sync (if possible at all) and the bluetooth earphone reliability was iffy.
Physically most wound up with so much lint in them, I'ld have to figure out how to disassemble them to blow the lint out. Antennas would break, battery cover doors would not latch right, and tape was the norm, and god help me if I had to read a screen in open sun.
I expect to buy 2 iPhones, one for my wife who can barely figure out how to do basic uses on her "LG" phone, so for once she can have her entire phone book on the iPhone along with calendar and notes, etc. This may be the godsend that finally means I can get her to stop using the inch thick phone & calendar book with the pages that get torn out.
For me to be able to move on and off the the phone, & web means I can simplify keeping in touch as just a starting point.
You make it sound like cellphones have only legal locks and can be listened to in the clear, or just with the help of a particularly powerful computer.
CDMA (both CDMA2000 and W-CDMA based systems like FOMA and UMTS) conversations are practically impossible to evesdrop upon. Even if you have the key (close to impossible), the timings and need for location information make evesdropping unbelievably hard.
On a technical level, the GSM system is easier to tap, but on a practical level it isn't. Early GSM networks used relatively breakable algorithms (at the behest, believe it or not, of British Intelligence who clearly hadn't heard of phone taps...), but after this was cracked most networks were upgraded to much more secure algorithsm. And just to identify a specific handset you need information only exchanged when the phone is turned on. These algorithms are publicly known, and there are as many people who want to break it as, say, SSL.
For all practical purposes, the only time your (post-analog/post-D-AMPS) mobile phone is going to be intercepted is if someone is working at the telco and has a tap on your line. Casual evesdropping is probably non-existant.
You HAM based system on the other hand can, and probably is given the frequencies, intercepted by casual evesdroppers all the time.
I know which I consider more secure.
You are not alone. This is not normal. None of this is normal.
It would be more like the Dimensiplex Inspitude Ditty Phone P2380.
Okay, everyone who thinks this will happen, raise your hand. Nobody? That's what I thought. Cell phone companies do not base the price of their service on how much it costs them to provide it (including the cost of the phone). Rather, they price their plans purely on how much people are willing to pay. ....
The math doesn't add up though - if they are selling smart phones with a large subsidy today, that subsidy money comes from somewhere. That somewhere is the guarantee of fixed income for a certain period of time, in other words the service cost is not just what people are willing to pay but also builds in the subsidy of the device you are getting for a discount with that service.
There's no reason why it does not make as much sense to say, that they would provide service for a reduced cost for a set period of time as well. All sorts of things already work like this - you pay less per year if you pre-subscribe for a longer period of time.
I think the argument that Cingular might want to use this opportunity to really pull in marketshare away from other carriers to be compelling, and with the iPhone at a fixed price it leaves them no choice but to use service pricing incentives as a tool to obtain that marketshare.
"There is more worth loving than we have strength to love." - Brian Jay Stanley
The iPhone is doomed to be a failure at that price. Sure, they'll sell some to the high tech crowd, and the "have to have it all" crowd. But everybody I know gets the cell phone that's free (or at least $100) with a 2 year agreement. You can get a razr for free every two years, or a comparable phone.
nothing
Along with the specialized features that someone above points out, Apple gets some very targeted marketing out of it. They realize that today no one goes to Apple looking for phone service. But they do go straight to providers. So when Cingular markets this phone with their service they'll target many many more customers than if Apple did all the marketing independantly. I imagine they also expect some people on their current Cingular plans to upgrade to these iPhones once it's marketing by Cingular. So Apple gets more customers through more targeting marketing, and Cingular gets more premium customers.
Developers: We can use your help.
...ridiculous wireless service flame war. I totally understand the motivation of fanboy-ism, but I am just so tired of the console/wireless/editor/distro/OS flame wars. They always say the same things and nobody makes any progress. Can we give it a rest?
~ I am logged on, therefore I am.
Unless Apple is totally nuts, they will have negotiated the contract terms in advance with Cingular, and threatened to go to one of the other GSM providers if the terms were not as favorable to the customers as possible. They should in fact be able to negotiate terms that makes the iPhone a loss-leader for Cingular, as the iPhone exclusive will be of great promotional value to the company.
If Apple is totally nuts they might have let Cingular in a position to decide the fate of the iPhone. Cingular might then very decide that iPhone is the perfect low volume high margin product, as the most determined Apple fans will buy it at any price.
>Do you mind if others make calls through your autopatch?
Not at all, go ahead.
Open Source Drum Kit, LPLC deve board - mjhdesigns.com
With phone number portability, the 2-year contracts are no longer tied to just phone subsidies, they now exist for their own sake. Even if your phone is "paid off", most carriers now have one monthly fee if you agree to a 2-year contract and another, higher, fee if you want month-to-month.
Use steganography. Who'd know the difference? Just record some of your normal conversations and turn them into digital info. Then you would basically do the digital equivalent of modulation of the recorded conversation and send the real conversation hidden within the fake one. No one could tell.
to start calling the iphone (tm Cisco Systems) the Newton 2 instead ??????
actually I am happy to see you, however that is in fact a banana in my pocket.
You live in a non-regulated market with regards to cell phones (as I understand it at least).
I live in a fairly heavily regulated market (Denmark).
Here, with the most expensive plan being prepaid phones, I pay about 4.3 cents/SMS including a 25% sales tax. About 14 cents/minute to make phone calls I think (I don't make that many - others call me)
Sure, we may not get as "awesome" a phoneplan as you guys do, and thus we probably don't get the phones as cheaply as you do.
But we don't pay for incomming calls or SMS' at all, which is rather nice - especially on a prepaid phone.
Also, when we go shopping for a phone, the sellers are required by law to tell us exactly the minimum price of purchace including the minimum price of any required plans (which can't go beyond 6 months btw).
Example:
Sony Ericsson W810i
Cheapest I can find is US$ 247 (minimum price during the 6 months)
This is 104$ for the phone, 17$ for the start-up fee, 125$ for a 6 month plan (and a bit of rounding).
Those 125$ (20.84$ a month) are simply the minimum cost - if you call, SMS/MMS etc for less than that per month, they'll just charge you the full monthly price.
Long live the free and unburdened market.
We do not live in the 21st century. We live in the 20 second century.
But wouldn't this lead others to want discounted service if they supply their own non-Apple phones? If an Apple Iphone user gets a discount for supplying his own phone, shouldn't a user who just wants to use a less expensive phone be able to supply it and buy the service at a fair price too? That would ruin the business model of the cel companies. The current business model of all of them, even though they are prohibited by anti-trust laws from all agreeing on how to screw the consumer. Isn't going to happen. Sure, there might be some claims of this, but new ways to screw the consumer will be created at the same time to make up for it.
Come on, the industry knows that the iPhone people are exactly the people who have too much money, they are not going to be giving them a break, at least not a real one.
I'm an American. I love this country and the freedoms that we used to have.
Righto, if I buy my own iphone at $400-$500, I get a service discount of $100 to $200, I presume for the first year, or first two years.
Ok, what if I screw the iphone and just buy my own. Can I get the $100-$200 kick back, as in premium service for $23 to $30 a month? If not, why not?
Not that I mind getting a new phone every YEAR, batteries do cost tens of dollars. But if they offer this deal for the iphone, the way I see it, they should offer the same deal if you bring your own phone.
There is no sanctuary. There is no sanctuary. SHUT UP! There is no shut up. There is no shut up.
visual voicemail?
Little Callwave is doing it. For free.
Big Cingular makes things seem hard when they aren't.
"Win treats sysadmins better than users. Mac treats users better than sysadmins. Linux treats everyone like sysadmins."
You could do it, but it's against the spirit of the amateur radio community. One might also say to simply include obfuscated, GPLed code within your closed program, and nobody would ever know. Just because you can do it doesn't mean it's right, especially when it flies in face of the terms you've accepted by having your license. If you want a private conversation, don't use amateur radio. If you want to talk to other hams, experiment with new radio modes and such, talk to people on the ISS, help with communications in times of emergency, or do a number of other cool things, welcome to amateur radio.
Already I see a few dozen replies along these lines:
"I should be able to buy my phone and my service as two separate transactions!!"
I don't know about other carriers, but Cingular already does this. Go look at their website. They list a price for the phone, and a price for the phone with a 2-year contract.
For example, a brand new Moto KRZR will set you back $400 with no contract, or $200 with a 24 month contract and a rebate form to fill out. You decide for yourself if 2 years chained to Cingular is worth an $8.33 discount every month.
Most people do commit to the service because they want the discount, and a cell phone isn't much good without service anyway.
You can still get the discount if you don't want a free phone. If your 2-year commitment is up and you want to make some money, go get a new phone at the discounted price, then sell it for a smaller discount on Ebay.
Buy an in-demand phone like the KRZR or Blackjack for $250, then sell it for $350-$400 and pocket the difference. People do this all the time -- go look on Ebay for yourself. You get to pocket some money in exchange for committing yourself to another 2-year contract. The person buying your phone gets a discounted phone, new-in-box, with no contract to worry about.
My wife had cingular and a nice samsung phone, I had Verizon and the cheapest/no-frills kyocera phone. Her phone would constantly get drop-outs...but not hang-ups...heh. Mine just always worked. It was weird...
Blar.
A third, very common, approach that's used is for the wireless carrier to offer a rebate and the phone manufacturer to contractually require that advertising never show an "after rebate" price.
Verizon does this quite frequently when new phone models come out. Voila -- carrier-funded subsidy without the possibility of seeing disconcertingly different ad prices for iPhone vs. widescreen video iPod.
1. Announce incredibly capable device with a rich API and excellent display which would attract even those who despise convergence due to planned obsolescence
2. The day after announcing product and upon garnering huge press coverage and generating buzz on sites such as slashdot and seeing that PocketPC and smartphone users will consider switching to your product and possibly developing for it, announce that third party applications WILL NOT RUN nor will such support be allowed
3. Two weeks later, announce that you will not allow your exclusive distributor to subsidize or otherwise discount your product offering
4. Get passed by, by the open source Linux phone projects
5. ?????????????
6. Profit (for your open-model-supporting competitors)
The Christian Right is Neither (Christian nor right). See: Matthew 23, Matthew 25, Ezekiel 16:48-50
Is the newt coming back????
---- Booth was a patriot ----
The cell phone service is going to be the 4th commmunications industry to pass thru this ridiculous hoop.
First was the US Mail - who realized the carriers had to walk the route each day and walk past each house each route. They oculd support fixed message cost, and it made them wildly successful. Sears didn't mind it either.
Next was the data networks, which charged per message, and when we all figured out they weren't epoxying together a brand new tube for each message, went to fixed cost per period.
Then we knocked on the telco's door and told them we figured out that they didn't have to run a new wire everytime we called someone, not even for the first time. They 99% went to fixed cost per period, with some sucker plans for people who still didn't get it and thought they could beat the telco out of the 99% plan. Vonage et. al. pretty much dope slapped anyone who still didn't get it.
Now come the cells. They still make us think that they have to send a squadron of pixies, who subsist on gold and caviar, flying out of the hayloft every time we want to place a call or send a message. Apparently the text pixies have never seen a salad, and the 411 pixies are down-right clones of Roseanne.
In the days of tower buiilding, when no one knew we'd all have these glued to our ears constantly, charging by the message unit was the only way anyone was ever going to let you take a risk like that.
That's all changed. The network is in place. The towers, T1s and infrastructure are all on, all the time - their operating cost is known and predictably rising with the cost of energy, inflation etc. The system scales now. Your unit revenue per user should find a point where it supports the scaling. Energy costs marginally less at night than at daytime, but it's always daytime somewhere in the net.
It's all a matter of who blinks first. Nights and weekends is slowly creeping wider, the others will have to follow. They are slowly, inexorably creeping towards flat monthly, but they're still betting some of us will put up with the sucker's bet.
I hope it works that way - in the telco case we had help from non-traditional suppliers who had nothing to lose and could bust the Bell model. In the cell case, there's the big six(?) who may slowly compete to some equilibrium, it won't be the rest that bust it - as MVNOs they just follow what the biggies do.
Here's hoping, anyway. Nice to see that Apple can make them think about dancing, though.
"Win treats sysadmins better than users. Mac treats users better than sysadmins. Linux treats everyone like sysadmins."
In Europe this is 'standard' since most countries (I know for sure in Belgium and I think it's a European directive) banned giving away free phones with a x-year signup contract on cell phones. So you usually pay full price for your phone (maybe $10-50 rebate) but you can't get the phone for free. You can step in-and-out of a contract at any time though (no early-termination fee, just pay whatever you started that month) although if you stay longer, you'll save up rebates and freebies. The phones (GSM) aren't locked so you can keep your phone in whatever provider you go (provided that the frequencies are all supported, but the newer phones don't have that issue).
I think that's also why Apple went with Cingular/GSM technology. 1) there is only one phone they have to develop for both Europe and US since CDMA is nearly unexistant in Europe, and 2) you can just switch your SIM cards to get another provider, no lock-in possible.
Custom electronics and digital signage for your business: www.evcircuits.com
Everyone assumed that Apple's $499/$599 prices for the iPhone was subsidized by Cingular.
Who thought that? At that price, it had better be profitable.
Cell phone internals are becoming very cheap. Check out the Texas Instruments "LoCosto" two-chip cell phone. Manufacturing costs are approaching $20. This isn't being reflected in the prices seen at US carrier's retail outlets, though. The handset price is inflated there, then "discounted" to compel users to sign up for "plans".
Cell phone companies are willing to provide incentives to acquire customers. The value of these incentives are frequently upwards of $300, given in exchange for a two year contract (some of that incentive will go to your sales rep as commission). What difference does it make to Cingular if they give this incentive as a service discount, or as a phone subsidy?
And if you're willing to pay $500 for the phone, chances are you'll be willing to pay full price on the plan.
Big companies don't typically play psychological games like this. They know what their revenue ramp needs to look like, they know what they need their retention stats to look like, and they know how much they have to spend on customer acquisition to meet those goals. Remember, if the phone is sold without subsidy, it is also sold without a contract. Cingular has great incentive to buy your signature on that contract.
I originally wondered about the lack of 3G. In the USA, where the iPhone first comes out 3G is not that available. At the same time more and more places are providing Wi-Fi access, which is much faster than 3G. By the time the phone gets to Europe (2008), you may find that the phone has matured enough to include good 3G support. In the meantime I think cellphone companies could start providing wi-fi access, which they provided at a reduced price (or free) for their customers and at a cost for non-customers. This would reduce the burden on the cellphone networks and potentially provide an extra revenue stream.
In the end I am not a soothsayer, so I can only analyse what might happen based on what's true now.
Jumpstart the tartan drive.
Game, Set, Match. Time to move on.
Then you're not in the target market for an iPhone.
End. Period. Full stop.
You might want to consider other devices like the Blackberry, perhaps a PalmOS, windows Mobile, or Symbian device with a similar keyboard and application set. But going on about the iPhone and how it isn't a good fit for you is just silly, same as telling us how a tank probably doesn't fit your car needs and Playdough doesn't make for a good meal.
The solipsism of some folks is extraordinary.
Just because the iPhone looks to be awesome gadget phone that doesn't mean it is necessarily gonna be your perfect gadget phone. If you need a full keyboard then, d'uh! , forget about an iPhone. If you need to connect directly to an MS Exchange Server then forget about an iPhone. If you need a SD card in your phone then forget about an iPhone.
See the pattern?
However Apple clearly thinks there is a market for folks other then you (I know, shocking!) And Apple has a pretty good record of consumer products. They've also a good record for UI's, your inane quibbling that they don't ship with a 3 button mouse aside (Hint: Most folks don't know what more then 1 mouse button does, now please back away from most folks before your head detonates trying to absorb that it's-not-all-about-you concept.)
Your sort are are why /. is so useless for discussing consumer products.
It doesn't come with WiMax! That's the future! Nearly nothing ships with WiMax yet, come back 2Q 2007
It doesn't run Linux/BSD/OGG/methane/whatever! 99.9999% of folks don't care, won't care, and frankly don't need to care.
I need it in blue, with a juicer attachment! Great, whittle yourself one.
Consumer products are meant to have broad appeal and therefore won't ever fit everyone absolutely perfectly. Revel in being on the far end of the bell curve.
I don't read ACs: If a post isn't worth so much as a nom de plume to its author then I wont bother either.
damn... there goes amateur radio phone sex.. :D
You might want to watch how strongly you promote this. You may not enjoy your 70cm band if everyone with a cell phone is trying to use the same band.
Sleep is for the Weak
They provided the unlock code for my Razr V3 and were polite and friendly while doing it.
Some mornings it's hardly worth chewing through the restraints to get out of bed.
Also, they want it positioned as a "premium" product, and they know idiots will pay full price regardless.
Nah, it only makes it into the semi-premium category. Now this is a premium phone: Vertu.
Jumpstart the tartan drive.
Still no word on Verizon support or unlocked versions of the phone so Ill still pass. I have zero desire to switch back to Cingular/AT&T any time soon. They need and open version for those of us more than conent with our current providers and service. Until then, Ill stick to the competitions phones and my current MP3 player.
Just don't try to order a Pizza! (That would be a Business call -- forbidden)
And make sure nobody puts you on hold, with hold Music (That would be Music broadcasting -- forbidden)
And make sure nobody you call uses any colorful language -- that might be offensive to your other listeners.
State your callsign often, it's the normal thing to do on a phone call.
Along with "OVER", and signal reports.
My cellphone is full duplex, a fraction the size of my HT, runs for days on a charge, and works anywhere in the US. There is no way an Autopatch presents a better value for personal and business calls.
That, and there's the small concern of RECEIVING calls as well..
$600 for a DRM-riddled phone? ...no thanks.
F**k HOOVER...
(Thought I heard a few clicks)
Sleep: A completely inadequate substitution for Caffeine.
You do not get your phone for $0.
If you mod me down, I shall become more powerful than you could possibly imagine.
I'd pay the list phone price for free service. 1,2 or 3 years depending on the price of the phones. Hell, I prefer to pay upfront.
The Kruger Dunning explains most post on
Maybe the pricing is fake to keep the competition off balance but at >=$500, the iPhone simply won't get enough market share to make any difference no matter what it does. And what it does isn't much: limited storage, limited applications, limited interface, no choice in carriers. I don't think so.
At $150, the E62 may turn the smartphone market upside down. The iPhone won't.
Thanks for the info. I'm really a non-techie on this stuff and though it was substanially easier to tap into the phones. At least I'm reassured now.
(Unless everyone that modded you *are* tapping the phones!!!). Kidding!
I've seen that assertion a few times on this thread. Why do people believe this the case? Is there some sort of law or something that says you cannot contract for service if you buy an unsubsidized phone?
It's a moot point anyways for the near term, as Cingular is the "exclusive" provider of service to iPhones for the first 2 years. Even if cancelled your service, you'd get no visual voicemail, and your phone features will probably brick as well without some hacking.
That said, I have Cingular, am happy with their service, sorta loathe my Treo, and there's a $600 pile of money in my money market account with "iPhone" all over it. Now I just gotta figure out how to get a timecode calculator widget on it :D
Don't blame me, I voted for Baltar.
If the iPhone can break mobile "phones" away from the US carrier lockin to their original network, then it's worth every penny. We need to be able to switch networks dynamically on service price/quality, not this insane AOL monopoly business model. Every step towards opening the "last mile" to multiple access is worth taking.
Apple has been the main driver forcing record labels towards discarding their archaic "scarcity" bizmodel, however limited its own movement along that road. Let's see if Jobs can force the networks open the way Apple forced computing to be "for the rest of us".
--
make install -not war
Correct, digital spread spectrum setups like CDMA are very very tough to listen in on. (I'm not sure about spread spectrum wireless phones though.)
Any how, that is why the FBI and NSA hook directly into the service providers. All cell signals sooner or later have to come back to earth in the form of "land lines".
Jesus was a compassionate social conservative who called individuals to sin no more.
If they don't subsidize the phone, and instead apply the subsidy amount (let's say $200) to the plan, over 2 years thats only a $8.33 discount per month. Not nothing, but when you consider that Cingular's lowest voice plan is $40/mo plus unlimited data for a PDA at another $40/mo, you wonder how much of a discount Cingular could give on the plan. They make pretty large profits on their data plans, so maybe they are considering selling iPhone service for between $40 and $60 a month including data. That would cut into their profits pretty severely, but should bring quite a few customers over (basically a loss-leader, but still producing profit).
I think the iPhone looks fantastic, and Señior Job's presentation was enormously entertaining and convincing. However, the U.S. cell phone carriers are making me take a pass, at least for now, because:
1. Excessive monthly price of voice AND data plans
2. Interminably long contracts
3. limited carrier selection (one, for now)
Are the U.S. cell phone companies going to continue to be the roadblock to promising technologies?
-G
www.pixelstatic.com
Apple has produced keyboards of variable quality over the years. Recently, like in the last ten years, almost complete commoditization of the PC and peripherals industries has forced Apple to generally cheapen it peripherals designs.
Early Apple keyboards were adequate for the time, but unimpressive and the company didn't jump on the "extended" keyboard bandwagon until after it developed the Apple Desktop Bus (ADB) in 1986.
In the late 1980s through mid-1990s Apple made a few remarkable keyboards. The Apple Extended Keyboard, Apple Extended Keyboard II, and Apple Adjustable Keyboard, were among the best keyboards I've ever used in regard to comfort and tactile response. They cost close to $200 new, and used individual mechanical keyswitches. On the very rare occasions when a key would fail (well, rare in the Extended models) you could take the keyboard apart and solder in a new keyswitch. The keys have very precise action and quick response; they can accomodate very fast typists. I'm typing this message on an Extended Keyboard II with a USB adapter. The keyboard was made in the early 1990s.
The Apple Adjustable Keyboard was pure bliss to type on. None of the modern ergonomic keyboards I've used have combined the same quick, smooth, precise key feel and adjustable design. The shiny new Microsoft ergonomic keyboards are awkward in comparison, with vague key response. Unfortunately the Apple Adjustable Keyboards were notoriously unreliable.
In the mid-1990s Apple released the AppleDesign keyboard. It was bundled with Apple's consumer machines and it's chief design goal to reduce the manufacturing cost to Apple. They used the now ubiquitous rubber membrane design. Apple eventually stopped making the superior Extended Keyboard II as the AppleDesign keyboard's lower cost was more appealing to people who didn't know what it was missing. Interestingly, the release of this keyboard more or less coincides with a steep decline in the quality of many Apple products that marred Apple's image in the mid-90s, and Apple became "beleaguered."
More recent Apple keyboards are just mediocre -- good enough that they're not worth complaining about, but not something most people would seek out.
This move makes lots of sense. No one smart is going to pay for net use by the kilobyte or put up with a capped or throttled connection. Apple appears to be giving Cingular an incentive to make the IPhone a non-metered device.
Those are my principles, and if you don't like them... well, I have others.
Why can't a terrorist with an unlicensed radio can transmit on the same frequency used by an aircraft instrument landing system, for that matter? If an unlicensed radio operator can do all that much damage you have far worse problems on your hands than any licensing agency can hope to solve - at least when [insert terrorist boogeyman here] reads what you just posted.
Your "satire" tries to compare apples versus oranges. A driver in a car needs a license because they can kill a bunch of people right out of the driveway. A pilot can crash a plane full of 100s of people. Radio operators can't do that. Oh wait, a terrorist can. I wonder why they haven't. Hmmmmm. Maybe they can't?
Now, I notice you totally ignored the other part of my remark... why does encryption have to be illegal?
--- Grow a pair, liberals... stop letting the Republicans bully you!
If construction was anything like programming, an incorrectly fitted lock would bring down the entire building...
... in my next cell phone:
- Bigger screen for web pages
- Support for third party apps
Right now that sounds more like a Blackberry or Treo, than an iPhone...
Sony Ericsson W810i
;-)
Cheapest I can find is US$ 247 (minimum price during the 6 months)
I decided to do the research with the phone for your example...
If someone had no phone service, they might buy the W810i through this deal here, which will give you a rebate of $50.
Phone price=$50
Rebate with contract=$100
Actual phone price= -$50
Cingular 450 plan (450 day minutes, 5000 night and weekend minutes, rollover for unused day minutes)=$39/month.
6 months service=$184 (not that it matters since it's a 2 year contract anyway
Now that allows me to make 450 minutes of outgoing calls for $40/month, but that would cost you $63 per month.
#include <signature.h>
On a practical level the carriers of GSM make it easy to intercept signals in the clear. Between the handset and the cell station the signal is encrypted. (In most countries, and most of the time) Each handset uses a different key. Making decryption more difficult is that the keys can and do change frequently. In effect, as you state, it's usually too expensive to bother with man in the middle attacks at that point in the system. http://www.gsm-security.net/ has a good FAQ
The cell site is where the decryption takes place. From here the signal is (in the very vast majority of instances) microwaved either directly to the exchange, or via other cell sites. These signals are sometimes transmitted over a series of standard E1, or T1's. Usually this happens between 1 and 4 GHz. Telco's do get rather creative with their multiplexers though.
Equipment needed is not cheap, but is definitely available off the shelf. Spectrum Analyser. Downconverter. Modem. Antenna. Computer, and a digital capture card. From this point onward there isn't much software available to break out the mux so you might hear Joe Six Pack talking to his mother. If you get this far, you would likely have enough cash left over for programmers though.
Nextel's PTT feature is most definitely NOT direct handset to handset. It may not join the POTS network, but 800 MHz iDEN signal is not going to let me beep my dad on the other side of the country.
Having said that, *some* Nextel handsets have what the radiocomm industry calls "talk-around". *IF* the destination handset is within direct range and also has this feature, then the two will communicate directly. The benefit is that if you and your buddy are in the same area and that area does not have Nextel coverage, you can still PTT. But Nextel's PTT is not inherently direct.
So a "missing" $200 subsidy translates to $8.33/month on a 2-year contract. Perhaps instead of directly subsidizing the phone itself, Cingular is subsidizing the cost of the data plan for the phone? Seems like this would make good marketing sense, and provide the potential buyer with a perceived savings (since that same data plan at retail might actually cost them $10-20/month).
DiscDividers tabbed plastic CD dividers: divider cards f
Technically, you may be right.
However, I wouldn't be surprised if some of the iPhone's features require special provider services -- services that aren't provided by other carriers. One example of this is the visual voicemail feature. So, how many users will be willing to live with a "crippled" iPhone when you get service elsewhere ... ? (Of course, if it's just one crippled feature, it may be acceptable, but, as no one really has one, we can't tell just yet.) It's a great lock-in strategy to have special services that can only be provided by Cingular .... (IANAL, but I assume that this is legal.) Think of special iTunes access only via Cingular, etc., ...
Also, it's possible that Cingular was able to put in contractual firmware limitations (e.g., "never put in VoIP, and we'll pay you $$$").
My wild guess is that Cingular will not offer any service discounts, but will require full Cingular service prices (read: $$$$$ for data access), as well as full iPhone pricing (as mandated by Apple, I believe, for reasons already mentioned by others). Why? Because there are lots and lots of drooling-at-the-mouth people who'll pay those prices. They might offer "early termination discounts", as that's a great incentive for the financially-challenged -- most of the comments I've seen have been people lamenting about their early termination fees, and not the high cost of the iPhone (which is probably more than their early termination fees) ....
Anyway, this is all wild-a** speculation, and we'll just have to wait for the actual details.
You miss one very key point. Perhaps not exactly DRM, though 3rd party applications will need to be signed and vetted by Apple before being allowed anywhere near the phone. Probably they'll be a tad like nokia where you can self-sign applications that don't need access to anything beyond display and audio, I'm positive you can understand the implications. You have a hand held computer (that includes a phone) capable of some potentially very cool things, but unless you pay the extortion fee to Apple, you can do nothing about it. That cuts out a huge chunk of the developer population right there.
On my thank you letter to Steve Jobs for making sure I wouldn't buy an Iphone. If he had launched with anyone except Cingular I would have had my credit card ready, but with Cingular there is no way on earth I am extending the contract 1 day longer then I have to.
While I agree with you on pretty much all these points, you *CAN* order pizza over an autopatch. It's not illegal for you to do business-type activities unless you're using the frequencies to benefit financially. Ordering pizza is fine, but pizza drivers using ham radio to coordinate deliveries would be illegal. Make sense?
FUD FUD FUD. How can somethign that is not even out yet be a failure? how can you complain about battery life when you or anyone you know doesnt have one? how much did you get paid to post this kind of nonsense?
"No wireless. Less space than a Nomad. Lame."
...And we know how that prediction turned out...
Dan Aris
Fun. Free. Online. RPG. BattleMaster.
Apple didn't require a two year contract. Cingular did. Apple doesn't give a crap about how long you stay with Cingular--they don't make any money from your service plan. Cingular probably just said "we'll support your phone, but we're not going to sell it to the month-to-month customers."
the question has been raised that if you can get your hands on an iPhone without service (how is not important), how much can it do just with WiFi. more importantly what can it NOT do? is it a valid little PDA with WiFi?
that's not DRM at all. if you are going to throw around laced buzzwords then use the right ones. i have NEVER owned a cellphone that allowed me to upload and run apps.
1) it's hard to complain too much when we are still months away from launch
2) maybe it will flop if it's that crappy and Apple/Cingular will rework the deal
who knows how much was Apple and how much was Cingular. same thing as iTMS. the DRM is because of the record labels, not Apple being weird. remember the RIP-MIX-BURN ad campaign a few months before iTMS went online?
This is all just a play on words from Mac fanboys to distract from the sticker shock and make Apple look "revolutionary". The bottom line is that it will be subsidized by your back-end service fees just like every other phone on the market.
The problem here is, game manufacturers are not making products for the same console for 20 years. Instead, they are forced to design and develop games for a new system every few years. I am not a game developer, but I believe optimizing for each platform is non-trivial. Combine that with changes in development environments and inflation, and you have your magical $10.
from http://www.westegg.com/inflation/
"What cost $40 in 1986 would cost $68.52 in 2005."
As for all games cost the same, I don't believe that is the case. Even the relatively cheap Wii games have a range of $30 (for the lowly Rampage) to $50 for Zelda.
Well, consider the monthly bill for a smart phone. A decent talk plan, a data plan, SMS, and whatever additional fees they tack on, can run you $100 to $150 a month. Although this might not bug certain enterprise users, for consumers who just now considering a smart phone, that monthly bill is going to be a shock.
If Apple can workout a deal to lower that ridiculous monthly bill, I would consider a nice phone that didn't sodomize my wallet once a month for 2 years. If they can't lower that talk + data plan price, well, you can count me out of the early adopter club.
All in all, if the gadget is cool enough, you can probably get away with charging more up front and less down the line. Heck, people were willing to pay a premium for the iPod when that first hit the market.
"Things are more moderner than before- bigger, and yet smaller- it's computers-- San Dimas High School football RULES!"
they have service in like 3 1/2 states. no thanks.
I don't want a carrier with worse reception than
my current one (tmobile).
music lover since 1969
Did I not read (before this article was even posted to Slashdot) that this rumor had already been debunked by Cingular?
...it's Cingular. If Apple had been smart, they would have marketed it to all of the major players and THEN you'd have a revolution. I don't see too many people switching over just for an ApplePhone.
What if you have no iTMS purchases? Then you have no DRM.
Right, same over here. I purchased through the fair "FairPlay" client (SharpMusique) for as long as that worked. After Apple decided this was "unfair", I stopped buying music altogether. In fact worse, I started downloading music because CDs are hugely overpriced too. I won't buy anything legally again, until all this DRM crap is buried forever or CD prices are affordable.
Nobody fucks with the Jesus.
Shaking out their wallets!
(I could have said worse.)
It's going to be very interesting to see how Apple changes the playing field for phone manufacturers with this.
Given that the phone is not discounted but the service likely will be. In a way, it actually makes sense - A LOT of sense.
Think about it: Phones are one-time purchases that a user can rationalize with a bonus or hell, even just on impulse credit purchasing (fire-and-forget buying). If you already have a sizable credit payment, adding the Apple iPhone to it won't make much of a dent in your rather predictable card payments. Any way you slice it, a phone purchase is, fundamentally, a one-time charge.
On the other hand... you can't as easily forget about a plan because you keep getting kicked in the head with that figure every month. A single purchase is not something you need to budget for, but a recurring charge is. My guess is that Apple knew this very well, and it underscores that they understand something about consumer psychology that the cellular service providers so far have not.
Furthermore, Apple has another huge advantage on their end in this type of model. They have a formidable profit margin on most of their hardware products. This gives them a lot of flexibility to charge full price and kick back some of that price to the cellular service providers. The Time Value of Money principle dictates that the future value of a present payment higher than the present value of a future payment. The more the cellular carrier collects up front as a portion of the phone price, even if it forces them to drastically cut their recurring charges, is worth more to them than the recurring charges they sacrificed. This is the same reason they apply corrections and credits in the next billing cycle (or if they're Cingular they "forget" to do so for a couple months on end), and the same reason they bind you into contracts... because if they have to wait for the money, they want a guarantee that they're going to get it.
Now, granted, I don't know if and how much of the iPhone price Apple is sharing with Cingular, but since the iPhone isn't discounted/subsidized, Apple's got a lot of headroom to play with to make this much more sensible for Cingular while at the same time playing to the impulse-purchasing psychology of the average consumer.
The only reason charging less for the phone than one month's service works nowadays is because of contracts... but even contracts are a risk because they're no guarantee of solvency. If the consumer is unable to pay, involving collections and going 30, 60 or 90 days without the revenue diminishes the value of the payment stream once they finally do receive it (which is why banks charge interest for loans and mortgages). They can make up some of the money with late fees and early termination penalties, but again not having the money in months A, B, C, D, etc. is extremely detrimental and if they have a lot of delinquent payments across the board because they have millions of customers with contracts, shareholders are going to take notice. It's far more valuable to the company and the shareholders to get the value up front without having to take the risks involved in a long contract term.