Apple vs. Wireless Carriers?

[wnurse]

These greedy bastards make me sick.
They will learn their lesson the hard way, I hope. Download insanely priced, crazy drm'ed, crap quality songs to a cellphone, what a joke.

wow. a lot of people are really angry that apple was not able to fleece the carriers. Hmm, does anyone know the market for ringtones?. Billions. Ringtones are just snippets of songs. You think verizon is just selling you songs?. please!!.. they are selling you songs as ringtones, when you turn on your phone, a song plays. You can have a song for each entry in your phone book, etc. A song for each entry in your address book. Play tetris and listen to your favorite songs etc. When verizon offers full songs and charge the same they have been for ringtones, do you know what the market for that will be?. Billions!!!!!. It will not magically shrink just because the ipod exist. The ipod has existed for a while now and ringtones are still a billion dollar market. What i see in this forum is just bitterness. Personally, if i was a ceo of a cell carrier, i would have rejected apple itunes phone too. The cell companies are not in the business of making apple money. They are not subsidiaries of apple. Besides, if they find customers dont want their songs at 1.99, they can always drop it to 99 cents. They'd be making the money, not apple. They wouldn't have to share a dime with apple. Apple is clueless in this market. Which cell maker (nokia, motorola, samsung) has ever demanded a portion of the cell profits in the past?. none!!. they make the cell phones, verizon provides the services. Never in the past has a cell phone maker gone to a cell carrier and say... we are offering you this phone and by the way, we are getting part of the profits. Which cell carrier is foolish enough to accept that business model? Motorola should have known better. Can't believe they let apple snucker them into making this phone. If apple wants a piece of this pie, they need to say to carriers, ok, we sell you the music at bulk, you resell to your subcribers at whatever price. If they fail, apple would still make their money. If they succeed, apple would still make their money. Apple cannot cut the carriers out of the picture. Apple cannot tell them to subsidize a phone but then demand that they be the ones making the money. Regardless of whether i was a greedy CEO of a cell company or totally altrustic, i would never agree to apple terms. It's financial stupidity.
And apple fans should not start railing about flexibility and choice. The ipod only allows one DRM standard (don't give me that crap about burning your cd and then transferring to ipod or mp3 on ipod, thats junk). Apple limits choice, so apple shouldn't be surprised if others limit choice. If apple limits choice and is successfull, why wouldn't verizon, etc be just as successfull limiting choice. What makes apple so special that they are the only ones who can limit choice and succeed?. Whatever!!.

 

[rickag]

.... Besides, if they find customers dont want their songs at 1.99, they can always drop it to 99 cents. They'd be making the money, not apple....

Not really, initially Apple didn't make any money @$0.99 and only recently has been slightly above break even in selling tunes @$0.99. iTunes exists to sell iPods and computers(I hope). This is unsettling enough for the music industry, they're beginning "pot banging" to try and get Apple to alter their agreements to increase the price on new releases and possibly lower prices on older tunes.

The phone companies in this country are greedy. Quite possibly Apple and Motorola may intro their new phone outside the U.S. first with more willing carriers. The US lags virtually the entire planet in cell phones.


edit: forgot to add that IF, big if here, Apple/Motorola offer the phone without carrier tie-ins, maybe the could start their own "Do The Math" ad campaign. Maybe Apple could give any Motorola phone buyer a rebate worth $0.49/song on their next 200 purchases.

 

[dicklacara]

Ironically, they need Apple to make this work. iPods/iTMS is the dominant player. Right now if I buy from Apple throgh iTMS there is no middle man. Even with that, there is barely any profit. If phone companies try to take a share, there will be super slim profit. Moreover, if each compay sets up there own service, it will be confusing and never really catch on (like non-iTMS'). Also, what are these phones going to hold? They can't be more than a small flash player. It all seems a little half-baked any not very appealing to me. I could be wrong.

Ya' know, someone posted that:

1) Apple makes little on each song because they are paid for by credit card and Apple must pay a percentage on each iTMS transaction to the cc company.

2) Phone companies bill each month and are paid directly (check or electronic) and don't have any cc fees (though there is a 30-day float)

Seems to me that a system could be setup that:

1) allows cell phone users to buy through ITMS
2) pay thru the phone company cell phone account
3) download songs to either pc or phone

Essentially, Apple would sell the songs to cell customers for the same price, but bill the phone company directly.

The phone company would make the percentage that Apple usually pays to the credit card company

Appropriate fees for services by each party could be negotiated.

The phone companies could take advantage of Apple's existing infrastructure to "Test the water" at little startup cost or ramp-up time.

Songs could be:

1) downloaded on demand from/to the phone
2) downloaded on demand from/to the computer
3) marked for download from the phone but downloaded to the computer(where bandwidth and battery-life are not the major concern)
4) exchanged/played on computer, phone and iPod, alike

Seems to me that the size of the pie would grow, the providers would make money appropriate to the service they supply, and the customer would get more choices.

 

[MacWhispers]

As far as the cellphone becoming tomorrow's iPod killer, I suggest that everyone reading this take a couple of minutes and conduct a little experiment.

Set your cell phone on the desk or table in front of you. Now, get the earbuds you use with your iPod and set them next to the cell phone. Try a few minutes of several alternate actions: cell phone to ear, as though talking... earbuds in ears, as though listening to music... now, add in a few normal cell phone activities... scrolling back through recent calls to find and dial a number... voice dialing a call or two (if your phone does that)... think about your actions. Think about those earbuds in your ears. Think about caryying and handling the cell phone through this constant mix of activities through the course of a day.

Now... think about your music collection growing and existing on your cell phone, not on your Mac or PC.

Finally, after all of this exploratory thinking and playing around, ask yourself this question: Is it remotely possible to make that platform work as a mass market digital music system?

Folks, the cell phone guys have obviously not done this simple exercise, and have no clue about how real people really want to own and manage their music. This entire period of optimistic predictions of digital music succeeding in any big way through the cell phone system is complete nonsense, little more than the self-serving fantasies of a few very wealthy, stupidly greedy telecom industry executives.

Cellphones dethroning standalone, PC-based digital music? Yeah... right.

 

[legalnut]

3. It's not antitrust. Just because they reject the itunes phone and want to develop their own services is not antitrust. If it was, ipod itself would indicate apple had antitrust issues. The ipod only supports one DRM and one online music store (itunes). Can't have your cake and eat it too.

I liken cell phone carriers to "common carriers" as such they should not try to shut out other companies trying to conduct business over their network ... they can obviously start their own similar businesses if they so desire but not keep others from using their network to start/enhance their businesses ...

 

[ScubaDuc]

thank you!

make a phone camera (not a camera phone) by putting GSM hardware on an existing 5-7 mp camera... the ultra compacts already have a screen, battery, buttons, etc... adding GSM hrdware would not have to make them much bigger. have a USB port for putting pics, and other data onto phones... use bluetooth for smaller stuff, but be able to use it with everything.... not just what the carriers want. They would be powerless to stop something likke this short of changing GSM specs

These phones already exists here in Europe However, even though I have an unlocked phone there are still some of the features don't seem to work right. This is because the providers do not like to give the info needed to configure the phones as they prefer you to buy one of theirs (pre-config) where you have to use bandwith to transfer stuff, so they can charge.

How is it that in the US I could not find a "pay and go" SIM card to drop in my spare tri-band for when I visit?

 

[aegisdesign]

I see your point. But let me save you a lot of frustration. Get an iPod Shuffle and be done with it.

One of those would be useful when I DON'T want to hear my phone but unfortunately, since I'm never really not available for supporting my customers, being able to hear my phone ring is of major importance to me. It's quite nice that they don't know I'm actually out mountain biking instead of sat in front of a computer and I'm not tied to a desk 9-5. All the best biking is done in office hours when the trails are empty. ;-)

If they add bluetooth capability to an iPod such that it switched off when the phone rang, then I'd consider it. Otherwise I'm carrying the phone, it may as well do everything.

I'd have to add that if Apple came out with a phone/iPod/PDA combined unit about the size of my p910i with a decent interface on it then I'd buy one in a shot. Phone OS's like Windows Mobile and Symbian majorly suck for usability and Palm's efforts are just too big and clunky to stick in your pocket.

 

[aegisdesign]

I liken cell phone carriers to "common carriers" as such they should not try to shut out other companies trying to conduct business over their network ... they can obviously start their own similar businesses if they so desire but not keep others from using their network to start/enhance their businesses ...

Surely all Apple needs to do is write a Java midlet version of iTunes or a Symbian .SIS version. Let users download it to their phone and bypass the phone companies completely. If the phone companies put a block on accessing the iTunes store on their phones there would be hell. I doubt UK operators would even contemplate doing it, the UK regulator would be on their backs in no time and most certainly the EC anti-competition commission.

 

[Tcnorman]

exactly

Well, whoever offers it gets my business.. for what it's worth.

Yep I am switching to whoever wants to support iTunes. I think some of these big carriers should think of that before just rejecting the idea.

 

[madmaxmedia]

Right now if I buy from Apple throgh iTMS there is no middle man. Even with that, there is barely any profit.

Ummm, Apple is the middle man. They may not make much money, but they are the middle man. And they are accepting lower profits not for our good, but as a strategy to sell more iPods. They do this since they own both the hardware and service sides, whereas the carriers only own the service side. Throw the music industry in this mix, and you have a lot of various companies not wanting to get left out.

I hate this ongoing crap with the carriers, but it's not a black and white thing. Everyone is battling for position, and everyone including Apple has a stake in it.

What is really annoying is the practice by carriers of restricting hardware features to push their own wireless services. But that's a choice every consumer makes themselves- get a free phone with a contract, or pay more for a phone and not be tied to a contract.

Even then at least we have a choice- we can still buy unlocked phones (EBay is a pretty good source.) Most people don't know their phones are locked, and probably don't care since they don't know they can send free MIDI files to their phone for ring tones...

 

[madmaxmedia]

Cellphones dethroning standalone, PC-based digital music? Yeah... right.

They don't think that any more than they think Java phone games are going to replace an XBox or PS2 (well, except for maybe Nokia and their NGAGE...)

It's not about replacing or dethroning iPods or anything else. It's about trying to generate some supplemental higher-margin revenue from 'value-added' services, since their core business is becoming commoditized like regular landline phone service.

People on this forum are not the type of customer they are going for with their $3 music downloads. They are going for the non-tech teens who may or may not have an iPod, but will still buy a few songs just like they buy a few odd songs for ringtones.

This is like selling $5 popcorn and sodas at the movie theater. It's not going to dethrone the supermarket, but these higher-margin extras often make up much of the actual profit.

 

[wnurse]

I liken cell phone carriers to "common carriers" as such they should not try to shut out other companies trying to conduct business over their network ... they can obviously start their own similar businesses if they so desire but not keep others from using their network to start/enhance their businesses ...

Even then, it's still not anti-trust. Apple is not trying to go into the carrier business. The common carrier rule applied to other companies wanting to resell same services as the common carrier. Apple wants to use the carrier network just as much as real wants to use ipod. If it's ok for apple to shut out real music content and napster music content, etc, then it's ok for verizon to shut out apple. Apple does not want to offer cell service, they want to offer their DRM music over cell networks. It's the exact same issue as napster wanting to offer their DRM music on the ipod. Again, can't have your cake and eat it too.

 

[wnurse]

Surely all Apple needs to do is write a Java midlet version of iTunes or a Symbian .SIS version. Let users download it to their phone and bypass the phone companies completely. If the phone companies put a block on accessing the iTunes store on their phones there would be hell. I doubt UK operators would even contemplate doing it, the UK regulator would be on their backs in no time and most certainly the EC anti-competition commission.

Now that the users have the itunes midlet, how would they get the music?
I presume they can go to the itunes store and then what do you think will happen?. Users will then be charged a data download fee. It will end up being the same price. You pay 99c for a song but then you pay 1.00 to download it to your phone. How does that help?. Is apple going to demand that the carriers allow data downloads for free if the data comes from the itunes store?. That i would like to see!!!.. i would not be shocked if it cost more to get songs on your phone through an itunes midlet than through the cell company own interface. What, u think u are the first to think of this?. You cannot bypass the phone companies. No one can. It's their network. This is a silly idea, hope apple is not foolish enough to consider it.

 

[Loge]

People on this forum are not the type of customer they are going for with their $3 music downloads. They are going for the non-tech teens who may or may not have an iPod, but will still buy a few songs just like they buy a few odd songs for ringtones.

So for once, kids have to pay more than adults for something, instead of the other way round.

 

[aegisdesign]

Now that the users have the itunes midlet, how would they get the music?
I presume they can go to the itunes store and then what do you think will happen?. Users will then be charged a data download fee. It will end up being the same price. You pay 99c for a song but then you pay 1.00 to download it to your phone. How does that help?. Is apple going to demand that the carriers allow data downloads for free if the data comes from the itunes store?. That i would like to see!!!.. i would not be shocked if it cost more to get songs on your phone through an itunes midlet than through the cell company own interface. What, u think u are the first to think of this?. You cannot bypass the phone companies. No one can. It's their network. This is a silly idea, hope apple is not foolish enough to consider it.

I've got some data allowance included with my plan and always have spare minutes which I can make data calls with. 1400 minutes a month is more talking than I can do. It'd cost me nothing extra to download around 10 songs a month.

Some of the data plans are outrageously expensive though so I don't disagree with your reasoning but for those of us that already have decent data provision then why not make it available. There's also enough people that don't pay attention to the small print so probably think they are getting it cheaper from iTunes. ;-)

 

[jeffbax]

I want an Shuffle / Phone mix so badly, I would love to only carry around one gadget... specially an Apple phone, all current phones leave sour tastes in my mouth.

Unfortunately, as seen with the rise of those terrible commercials advertising ****ing wallpapers that people pay like $2.99 per week for, I wouldn't be surprised to see people pay the high price for these songs

I hate the US Cellphone market, it sucks compared to the likes of Europe.

 

[dicklacara]

So for once, kids have to pay more than adults for something, instead of the other way round.

Now... if we only had some way to tell them apart...

 

[Philsy]

I've got some data allowance included with my plan and always have spare minutes which I can make data calls with. 1400 minutes a month is more talking than I can do. It'd cost me nothing extra to download around 10 songs a month.

Some of the data plans are outrageously expensive though so I don't disagree with your reasoning but for those of us that already have decent data provision then why not make it available. There's also enough people that don't pay attention to the small print so probably think they are getting it cheaper from iTunes. ;-)

I think the idea of a Symbian version of iTunes makes a lot of sense - it means anyone could buy music using a 3G phone. It's unlikely to cost much if you have a decent deal with your provider. Maybe a third party developer could come up with it?