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BW reiterates reasons for iTunes phone delay

updated 09:10 am EST, Thu March 24, 2005

iTunes phone delay

As indicated by other reports, Business Week says a lack of support from such giant cellular operators as Verizon and Cingular was from Motorola. "Behind the clash are two very different views of the future of music on mobile phones. Motorola and Apple would let customers put any digital tune they already own on their phones for free. That would help Motorola sell more phones, and it would help Apple expand its dominance of digital music ... Verizon, Cingular, and other wireless operators want customers to pay to put music on phones. They think getting a full song should be like getting a ring tone." The carriers have "no interest in conceding the booming digital-music market to the tech companies." "When carriers see this future, Apple is front and center," says Andrew Cole, head of wireless at A.T. Kearney. Apple is "a competitor not to be embraced, but to be rejected." Even if Cingular and Verizon won't sell the Motorola-Apple phone, some believe smaller rivals like T-Mobile may peddle it to gain ground on the industry leaders.




by MacNN Staff

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  1. njfuzzy

    Joined: Dec 1969

    0

    nice editing

    The fifth grade called. It wants its commas back.

  1. testudo

    Joined: Dec 1969

    0

    Usable bought seperately?

    If you buy one of these phones separately, rather than through Verizon, can't you still use them with Verizon. Aren't there rules on the books about this kind of thing? Or is it that few people buy their own phones, they stick with whatever their carrier offers?

  1. piracy

    Joined: Dec 1969

    0

    Re: Usable...?

    h*** yes it's usable bought separately, especially if it's a GSM phone.

    Common sense so far would point this in the direction of being a GSM phone, since:

    - Motorola first demoed iTunes on the Motorola E398, which is a tri-band GSM phone, and

    - The first iTunes handset is said to be the E399, which would seem a logical progression from the E398

    ANY GSM phone can be used with ANY GSM carrier (assuming it operates in the right bands, but any GSM phone sold in the US would be compatible with US GSM carriers). The only trouble with GSM comes from carriers locking phones to their own networks. Phones sold as standalone would be "unlocked", and could be used on any plan with ANY GSM carrier by simply inserting the SIM card into the phone.

    So why wouldn't Apple and Motorola just do that, then?

    The disadvantage of this plan is:

    - You don't have a huge carrier promoting the phone (even if Motorola and Apple promoted it themselves, it would still pale in comparison to promotion on TV, in print, on radio, and on their stores by a carrier)

    - Most importantly, you don't get the $200-$300 subsidy on the phone from the carrier. So for an iTunes phone that might be $199 with a plan on a particular carrier, the customer is now expected to shell out $500 for the phone themselves. AND get a plan. That would seriously hinder the phone's adoption. Yes, yes, of course people would still get it, but the sales would be a mere fraction of the possible sales had there been an agreement with a carrier.

    The bottom line here is since some carriers already completely rape customers for $3 for a S***** ring tone, and they don't want customers putting data of any sort - including music - on their phones themselves, unless they're paying unbelievable fees to do so through the carriers network, no one will support this phone (unless it's a smaller carrier, or Motorola ends up crippling the phone, such as happened with Bluetooth on Verizon with the Motorola v710).

    This is extremely frustrating, but the carriers want to be the ones to sell the songs, and not for $0.99. And DEFINITELY not letting people put MP3/AAC songs they might already own on the phone. They want to sell songs for $3/each, or more, and be the ONLY way a customer can put music on the phone.

  1. mjpaci

    Joined: Dec 1969

    0

    Verizon

    There was an article/interview in Wired a few months back regarding Verizon's take on moving data to/from a handset. Verizon believes that anything going to/from your phone should go through their network. This is why Bluetooth capable telephones sold through Verizon only use Bluetooth for headsets. They want the revenue generated by moving bits over their network.

    It's all about guaranteed revenue streams.

    --Mike

  1. cmoney

    Joined: Dec 1969

    0

    Get a clue

    If there's anyone who's got fewer clues than the music industry it's the telecom industry, mobile and wireline both. I will never give money to any company with "Verizon" in its name ever again.

    And Motorola has actually released a phone that's playing into Verizon's hands, software rental and all. http://www.phonescoop.com/news/item.php?n=1147 So Motorola doesn't lose a thing because they're covering all ends of the spectrum. The only way they'll push the iTunes phone is if they see $$$ in offering it. If it jeopardizes sales of other phones to these big carriers they'll pull out or limit the market to Europe or Asia.

    If that's the game the big cell carriers want to play I guess I'll never have a single device to carry around. I won't be playing by their rules and neither will anybody I can influence.

  1. mytdave

    Joined: Dec 1969

    0

    Carriers - wake up

    I for one will never buy a phone that has been "crippled" from any carrier. My current phone has full bluetooth functionality - if it did not, I would not have purchased it.

    I will not be taken advantage of and I will not use my money for a phone/carrier who restricts access to the device I own.

    Needless to say, I don't buy ring tones. Further, I will never pay a carrier to buy music or video clips, or other content. The amount I pay them now for air time/bandwidth is sufficient.

    Any phone that cannot have files directly transferred to it or from it via bluetooth, infrared, or wired will never, ever receive a second thought from me.

    If carriers want to get into the content provider market, fine, build a media outlet that can compete on its merit, just like everyone else. Don't lock out content from other sources or "cripple" my phone in any way.

    Any carrier that behaves badly (like Verizon) will not get my business.

  1. mytdave

    Joined: Dec 1969

    0

    One more thing...

    BTW, Verizon works closely with M$. They have learned the M$ business playbook - embrace, extend, extinguish. Verizon is the M$ of telecom. I'm glad I got out from under their thumb when I did. My new phone isn't "crippled" cause I don't have a Verizonized phone!

    Feels good to be 100% M$ and Verizon free. :)

  1. eddd

    Joined: Dec 1969

    0

    things are changing

    Yes, the phone companies must not realize how angry many of their customers are. But I think things are changing as GSM takes hold and people see that they don't need to buy a phone from the carriers. The number of "unlocked" phones available keeps increasing, and more people are looking into how the system works. There are already a good number of services and technologies available for the technically savvy.

    For example, my Motorola phone would have been crippled if I bought it from my carrier - I would have needed to pay to download or upload anything, even my own photos. But I bought it unlocked on eBay and proceeded to find the software and cables necessary to program the phone myself, installing features (java, games, ringtones, photos) as I see fit, without ever having to deal with the carrier. I would never have it any other way.

    And the carriers will give you a great deal on a phone if you're opening a new account, but not if you're buying a new phone to use with your existing account. Their prices in that case are quite high.

    There will always be a workaround to the phone companies' barriers, as long as you can connect the phone to your computer. I have no doubt the iPhone would sell well, and people would find a way to get their music on the device. Particularly the target market of 16-30 year-olds, who have grown up messing with technology.

  1. spacefreak

    Joined: Dec 1969

    0

    Re: Get a clue; Wake up

    Apple and Motorola are the ones who need to "wake up" and "get a clue". Same goes for the Steve-Jobs-is-God congregation.

    This PR battle is a weak blame deflection campaign executed by both Motorola and Apple to try and cover up their stupidity for developing such a phone and service BEFORE having deals signed with the carriers. As usual, the Steve-Jobs-is-God congreagtion eats it up bite-by-bite.

    Motorola and Apple have no one to blame but themselves.



  1. cmoney

    Joined: Dec 1969

    0

    Re: spacefreak

    This is not about "Apple is God" but about mobile carriers are greedy. That much is a fact. In fact I don't even say a thing about Apple in my post.

    Yes, Apple and Motorola should've gotten buy-in from the carriers first. That doesn't disprove the fact that carriers are nickel and diming customers with things like software rental, $2-3 ringtones and crippled phones.

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