Wednesday, November 28, 2007
Verizon Wireless Takes Reasonable Gamble
One might argue that Verizon Wireless is gambling with its whole business model in allowing use of technically-compliant devices and software on its network next year. But one can point to the experience of wireless operators in Europe, who have used this "open" model for years, to see it is not so dangerous.
In fact, Verizon gains more than it might potentially lose, just about any way you want to spin the matter. First off, it gets great press for breaking the "closed" mobile model on a voluntary basis. Also, it is betting, likely reasonably, that the overwhelming mass of buyers still will prefer the old model of "discounted phone, two-year contract."
Verizon also uses the CDMA platform, which already means there is less handset choice than possible on a GSM network, since the GSM market is so much larger, globally. Verizon just might stimulate a bit more handset and software choice by going open.
Also, open is inevitable. The 700 MHz spectrum requires such device and software openness, so it is coming to the market, in any case. Verizon might as well "look good" rather than resisting the inevitable.
Open also means Verizon has a shot at creating a more robust developer community, a helpful asset indeed as more innovation moves to the software realm.
There's very little, if any, downside and lots of upside. Not since AT&T launched its "Digital One Rate" has any leading mobile provider taken a step that will reverberate throughout the whole industry. Sometimes, innovation is not just something small companies pull off. Sometimes very large companies do it as well. And maybe, sometimes, only a very-large company can cause a major change. On occasion, innovation may require the push only a very-dominant firm can supply. This appears to be such a case.
Labels:
open networks,
unlocked phones,
Verizon Wireless
Gary Kim has been a digital infra analyst and journalist for more than 30 years, covering the business impact of technology, pre- and post-internet. He sees a similar evolution coming with AI. General-purpose technologies do not come along very often, but when they do, they change life, economies and industries.
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