“Apple must do whatever is necessary to buy off AT&T. Ma Bell is killing the iPhone,” Tim Beyers writes for The Motley Fool.
“Twice last week, the Mac’s daddy debuted — and then pulled — a tethering application called NetShare from the digital shelves of its App Store. As of Monday, software developer Nullriver said that email problems on both ends led to the interruptions,” Beyers writes. “Really? I find that barely plausible at best… It seems more likely to me that AT&T objected to what NetShare does.”
“Tethering allows a cell phone’s connections to the Web to be shared with other devices. NetShare would allow a MacBook to plug into AT&T’s 3G network when Wi-Fi is unavailable. Alas, Ma Bell’s iPhone usage terms prohibit exactly this sort of activity,” Beyers writes.
“Tethering is an extra… AT&T sells it for $15 a month to customers whose use Motorola , Nokia, and Research In Motion handsets, but not to iPhone users like me,” Beyers writes. “Think about the consequences of that: Apple may have just blunted innovation on the iPhone for the sake of a partner that wants to sell more stuff. It’d be unthinkable if it weren’t so logical. (AT&T has also twice hung up on on free Wi-Fi for iPhone owners.)”
Beyers writes, “Apple should use whatever portion of its $20 billion war chest is necessary to buy off AT&T and escape from their exclusive iPhone deal. Only then will the iPhone grow to be the pervasive platform that the company and its investors desire.”
Full article here.
While we fully understand Beyers’ angst, it’s completely overblown. Ma Bell isn’t killing the iPhone; they’re killing tethering. Tethering or the lack thereof simply has no real effect on iPhone’s ability to grow to be a pervasive platform.
That said, the number one reason people tell us they can’t get an iPhone today is: AT&T. Due to no or poor network coverage where they live and work. If Apple offered the iPhone through other carriers, sales would explode even more than they are currently. Carrier exclusivity limiting sales is a good reason why Apple might want to try to dump out of their U.S. contract with AT&T, not tethering.
Of course, If Apple were to let more carriers into the iPhone party, the carriers might be less willing to subsidize so dramatically (like AT&T), which would result in higher iPhone retail prices that would also limit sales. Therefore, it’s probably best to do it the way Apple is doing it now until economy of scale kicks in enough to drive down iPhone’s unsubsidized cost to levels within the reach of the mass market.
More bars in more places.
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I often criticize MDN’s take because I think they can be too much of a fan and lose perspective and credibility. But I think this take was excellent and really put things into perspective. AT&T;is killing tethering, not the iPhone. The AT&T;exclusivity deal involves trade offs, most of which are favorable to Apple. Apple will drop the exclusivity as soon if and when it’s advantageous to do so. And not before.
MDN QUIT DEFENDING AT&T;!!!
You can’t sugar coat AT&T;GREED!!
I have a $30 phone with $10 a month in minutes that does everything (and a bit more) than my previous $300 AT&T;phone and $60 plus a month plan!!
AT&T;is stuck back in the “real estate bubble” where people had HUGE amounts of spending capital and were used to spending around $100 a month for a mobile phone contract.
The fact is people are cutting back and dumping AT&T;/NSA/Elitist phones for more economical ones.
Apple should come out with a “pay as you go” flip iPhone that costs under $100 anytime now to OWN the market.
And YES THEY NEED TO DROP THE SH*T AT&T;!!!
He must of been hired by the other mobile providers (you know the ones that turned their nose at Apple when they came around for iPhone 1.0 partnerships).
Apple should stay with whoever they feel is making them the most bucks and screw everyone else.
Just my $0.02
Anyone remember Jobs declaring the 3.5″ floppy dead while every PC manufacturer was including them as standard equipment?? Jobs skates to where the puck is going to be, not where it is. Verizon and Spint both use antiquated technology for their networks (sprint actually supports two smithsonian quality networks with their stupid acquisition of Nextel). GSM is the future and the rest of the world has it figured out.
Why not make money off an exclusive deal when all of the other competitors lack the technological savvy to handle your product effectively.
@ MrMcLargeHuge
Verizon may be control freaks now but just wait until they open up their network
http://www.marketwatch.com/news/story/verizon-wireless-open-up-network/story.aspx?guid={E879FB44-3D42-48FD-8B6B-DD6FEADB4FBD}
It’s simple marketing and production and return. GSM is the most prevalent around the world. To produce the same device and ship it anywhere is a large savings to apple. You can’t just change software in the iPhone and make it work on Verizon or Sprint. It’s different frequencies (radio chips – hardware) and protocols. Apple knew what they were doing. The only real choices they had in the U.S. are AT&T and T-Mobile. After a few years of production, they may be able to make CDMA versions of the phone and sell them to Verizon and Sprint, but they were going strictly after market share from day 1.
Flip iPhone??? Under $100???? Are you on crystal meth???
What other carrier is offering the same plans as ATR&T’s iPhone plan for less money?
It would really help discussion a lot if people were to read a bit about the subject they’re posting.
And by the way, Apple seems to be well on their way to owning the market; so much so that they can’t cope with the demand.
He’s right.. Apple should dump AT&T;.
Now, on the other hand, ALL of the other carriers SUCK just as much as AT&T;sucks.
Let me say it again.. THEY ALL SUCK!
Wireless phone and data service is no where near as dependable as wired service. When it is, if it EVER is, then, whoever makes that happen, won’t suck.
I don’t think Apple would have any problem with production or logistics in having several carriers in the US. After all, they are opening in 80 countries soon. What’s 3 more carriers. I think AT&T;is a calculated move made by Apple, in their wisdom, that will not change until their contract expires.
Wishing it otherwise is a waste of time. Go buy an iPhone.
1. Verizon blew it with Apple
2. AT&T;could see and think longterm
3. Apple had to get the iPhone ball rolling…getting started is the hardest part.
A contract was necessary.
4. Motley Fool is a great name that accurately describes Motley Fool.
Years ago on WSB radio I would listen to one of their guys poop Apple almost every day…he was ignorant then and is ignorant now.
As deuxdrop said, Apple made a choice from the very beginning — GSM — that limited their carrier choices in the U.S. to AT&T;or T-mobile. And T-Mobile uses a different 3G protocol than AT&T;. Verizon and Sprint use CDMA technology and don’t figure into that equation AT ALL. There’s no point in getting all worked up about the other networks in the U.S. if the iPhone won’t work on it anyway. The situation is quite different in the rest of the world where multiple modern telecommunication networks are more the norm.
I did not see one point said that mentions that Apple would have to make a separate phone to use on the Verizon network. They may be number 1 or 2 in subscribers here in the US but going to the rest of the world you need to get a special phone from Verizon to work(Had to get a world phone for use in Italy).
When Verizon comes around to be compatible with the rest of the world then it might be a good idea to open up to other carriers.
Sorry to Aldebaran… You did make the point.
Gregg Thurman,
“Tim Beyers/MDN are the type that bring one girl to a party and leave with another.”
Well yeah, but the girl they left with puts out.
@ Gregg Thurman
Its called trading up. Sometimes you do it for fun… sometimes you don’t even need a bowl for house keys…
@Sir Gill…
damn your fast
Mute point:
Here in Australia we can buy outright and unblock or contract with FOUR different carriers – and the iPhone is sold out or close to sold out most of the time since “legal” intro on 11 July.
And I have my iPhone tethered with NetShare – used it yesterday when I couldn’t wardrive any location near me (20 locked nets) 🙁
When I was with Sprint in Hawaii, I was able to tether all of the time. It was great! And sprint even had a plan that included it!
ATT’s logo should be a ball and chain… And Jobs has one around his neck! to tie into one carrier and then extend the contract is phuquen nuts.
Why four carriers in Oz? Because the market demands it. /sarcasm Hmmm, I guess there isn’t that big of a market in the USA. /endsarcasm
According to rumors, Verizon had their chance… Blame them, not Apple.
It’s amazing how much people don’t understand about the carriers and how wireless networks are structured.
The USA has two totally seperate networks GSM / CDMA based. At&t;and TMO are GSM based so likely TMO would be the next likely Iphone supplier. The rest of the world pretty much is GSM based except Japan as they have their own network UDMA.
Apple is likely buying time until LDE lights up in 2010 timeframe .. it’s going to be the global standard unless WiMax gets traction.
Tethering is a pretty big deal for road warriors and a great tool. In the states the only carrier that includes it is Sprint, every one else it’s extra on top of your data plan. So why would an app be allowed to do this for free? Sure its cool but I’m sure carriers aren’t going to let that fly and give up X # of users @ $15 extra per month.
Let’s not forget that mobile phone customers all over the world use their cellphones as tethered modems every day. Even in India, I had convenient internet access everywhere by using nothing more than a cheap Reliance cell phone and a USB cable. It is extremely ridiculous for AT&T;to refuse to allow iPhone customers to do exactly the same thing with their iPhones. I’d even pay them the extra $15 a month. No problem. But blocking this feature is totally unacceptable and is not making any friends for AT&T;.
Bluefin,
“damn your fast”
So my wife tells me.
MizuInOz,
“Mute point:”
We can’t hearrrrrrrrr you!
It will happen, but for now Apple is building slowly and carefully, just like they did with iTunes and the iPod.
2 years max to see the iPhone on other networks.
Why? Because it will sell MORE phones and thats what Apple want.
I have to go along with MDN’s take on this. I’m not a big fan of AT & T, and I would love to see more tethering, especially with the iPhone. We could definitely have it worse. We could be part of Verizon and not have any free features. No bluetooth connecting to our Macs, or other devices. Verizon is notorious for shutting down features.
Some day that AT&T;contract will be up and guess what Apple will do? Re-negotiate. I bet that this partnership has been completely all right with Apple. Everyone has been making tons of money on this partnership. Everyone has benefitted from this collaboration. Get used to it.
Now maybe a few years down the road, we’ll see a Verizon iPhone and it will be a wide open market, but Verizon will have to let Apple call the shots and I don’t think that will ever happen.