Sunday, August 14, 2011

Should the Apple Wireless idea be just a fantasy?

Jean-Louis Gassée posts a fascinating article at Monday Note: "Steve, Please Buy us A Carrier!"

The key thrust of the article is raising the question: Why doesn't Apple buy T-Mobile and raise the service bar amongst carriers. The purchase would save T-Mobile and USA Consumers from the clutches of AT&T. It would take a sizable chunk of the $76B cash pile that makes Apple more cash rich than the US Government.

It is a cute idea that will capture people's imagination, certainly amongst the Apple fan boy crowd. But buying T-Mobile is a USA only proposition in a world where an increasing proportion of revenue is generated by international sales.

Apple and Steve Jobs would be driven mad by the government regulations and the timeframes involved in deploying cellular networks and that is before we get to the capital investment demands needed to support network deployment.

No, there is a better way for Apple to accomplish this objective. Apple needs to continue to develop the iPhone platform as a world phone. A phone that can be configured in software/firmware to connect to any worldwide network. With GSM and CDMA capability provides just that before long LTE with a decent battery life will be up to Apple's rigorous standards.

Then Apple needs to treat the carriers as "dumb pipes" and create Apple Wireless as a Virtual Mobile Network Operator (VMNO) - a worldwide VMNO. By following this route Apple can create the Customer Service in Wireless that is uniquely Apple. It builds on the growing network of Apple Retail stores and can offered the simplified pricing and service packages that Apple is renowned for.

As a worldwide MVNO Apple can also offer affordable international roaming that could make a compelling offering for business and professional people who travel regularly. 

I  could even see Apple using their Virtual or firmware SIM idea as a means to provision consumers on AppleWireless. This might also help to enable international roaming at a reasonable cost while consumers retain their phone number.

Apple doesn't want to become a Carrier but a Virtual Mobile Operator, that is an entirely different question. 

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