Apple to succeed where Google failed: reshuffling power in the U.S. cellular market?

  • October 27, 2010 7:27 pm

The Nexus One joint project between Google and HTC was a start of better things to come. While our mobile-loving friends overseas enjoy healthy competition in the mobile market, we here in the states don’t have much to go with. Yeah, four large carriers is at face value, competition. But the sad state of affairs is that differences in cellular technologies more or less render *easy* carrier switching all but impossible. But Apple is rumored to be working with SIM card maker, Gemalto on a new implanted (read: non user-replaceable) SIM card.

While it sounds odd to us Americans, a competitive cellular market does actually exist in some corners of the earth — Europe in particular. And with Apple’s new built-in SIM cards, a new era in mobile phone usage could be born…
It may seem like we consumers have it pretty well off with four major carriers and smatterings of smaller, regional carriers spread across the country. But the fact of the matter is, our situation sucks.

AT&T and T-Mobile are both GSM carriers, however, they user different frequencies for 3G (AT&T: 1900MHz & 850MHz | T-Mobile: 1700MHz). Thus far, most phones aren’t coming as quad-band HSDPA/HSPA phones, meaning you either have an AT&T phone or you have a T-Mobile phone.

On the CDMA front, Sprint and Verizon aren’t really all that far off in basic technology, though the lack of SIM cards makes it extremely hard to jump around with both carriers hard locking the phones down to each carrier’s respective networks. So as you can see, competition isn’t exactly “alive and well” in the land of milk and honey.

In a report published by Gigaom, several sources from within the European cellular industry are coming out claiming that Apple is working with European cellular operators to incorporate a new kind of SIM card in future iPhones. The big difference between this new SIM card and the current style is that it is built in.

Uh-oh. I know what you’re thinking: Built-in = bad. In regards to batteries, hard drives, and RAM in particular, that statement can generally be followed by “yes”. But in this particular case, the built-in SIM card is actually writeable. The basic hardware would support all the carriers in a given region (perhaps even globally). When setting up the device on a particular carrier, simply connecting to iTunes would download the small file needed to configure the hardware for the chosen cellular carrier. Easy. Quick.

Here in the states, taking control away from carriers hasn’t gone over well. But overseas in Europe where competition is already fierce, this type of SIM card could be quite popular. The real test would be back here in the land of the “free”.

If you recall, Google’s initial goal with the Nexus One was to cut out carriers from the whole phone buying/decision process. Selling directly to consumers was the apple in their eye. But the carriers pushed back…hard. And Google, understandably not wanting to harm carrier relations for fear of hurting Android adoption as well as having a lack of easy, brick and motar stores to get Nexus Ones in consumers’ hands, gave in.

Apple is in a much better position though. They don’t need the carrier to help them get phones to people. They have plenty of physical stores, and that number is growing weekly. Not to mention, people flock to their physical stores almost like sheep. Clearly, grabbing attention and sales isn’t something Apple has a hard time with.

Remember, right now this is merely speculation based on a few “inside sources”. Not only that, but plenty of services and products live and die in the concept stage, failing for countless reasons to ever reach the public. This built-in SIM is no different. While we hear about it now (and assuming that it’s real), it too could face the same fate as so many other awesome innovative products and services. But for the sake of the mobile industry as a whole (and especially the U.S. wireless industry), I sure hope Apple does move forward with such a feature and does well. If one company can shake things up and make a change, others will surely follow. And when big companies compete, consumers win. I don’t know about you, but I’m pretty damn tired of losing. It’s about time we get a victory, wouldn’t you say?

Source: GigaOm
Via: Ars Technica

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