T-Mobile Sells iPhone in German Market

T-Mobile will sell Apple's iPhone in Germany for 399 euros ($558) each. Service plans weren't immediately announced. As in the United States, where Apple picked at&t as its exclusive network services provider, customers in Germany will have to sign up for two years to buy and use the 8-gigabyte version of the phone-iPod-Web appliance.

In the U.K. market, where O2 has a five-year exclusive on service for the iPhone. And a pattern seems to be developing in terms of the business model.

Estimates of how much revenue O2 is going to share with Apple vary between 10 percent to 40 per cent and it is likely both figures are correct. The delta is what Apple gets paid based on the degree of churn the device can induce.

Apple might get 10 percent of revenue when an existing O2 customer gets an iPhone, but Apple might get the heftier percentage when a customer switches service providers and becomes an O2 customer.

at&t pays Apple $3 a month when one of its existing customers buys an iPhone plan, but $11 a month when a customer switches carries and becomes an at&t customer.

O2's ARPU (Average Revenue Per User) is around £23, so 10 per cent of that would be £2.30 while 40 per cent comes to £9.20.

3G GPhone?

Now that Adsense for Mobile is launched in 13 markets, the next issue is whether, or when, Google will launch a branded handset, and whether it actually will bid to own its own U.S. mobile broadband network.

DigiTimes says Google is pondering both EDGE and 3G versions of its branded handset. And DigiTimes says it has been told Google might opt for 3G. A switch from EDGE likely would push back the introduction into the first half of next year instead of this year.

High Tech Computer is said to be the manufacturing contractor for the Gphone.

3G would make lots of sense for a device so Web browsing centric.

No Wireline in This at&t Bundle

In a nod to new market realities, at&t is offering a package of wireless calling and residential high-speed Internet without wireline voice as a mandatory part of the package. at&t will launch the program in seven cities.

Bought separately, the wireless plan would cost about $40 while the 1.5 Mbps DSL would cost about $20. The advantage today is avoidance of the need to buy a wireline voice connection to get the DSL service as a stand alone. It's a half step to full naked DSL.

The $60 a month package is aimed at younger users and college students, and
includes 450 wireless minutes of "any time" wireless use plus 5,000 minutes on nights and weekends, plus free calls to other AT&T mobile customers. Customers also can roll over unused "any time" minutes.

The digital subscriber line service operates at a 1.5 Mbps rate downstream. The same plan is offered for $65 in the former BellSouth territory.

Later this year, AT&T plans to offer a naked DSL connection at about half that speed for $19.95 a month to all customers. That offer will put real pressure on the remaining dial-up connections.

telx|vision: Anthony Sticha, Interview at Cbx 2007

Build For Your Kids, Not Your Father

A recent survey by CIO Insight suggests chief information officers use (or think they ought to say they use) Internet video, wikis, blogs, really simple syndication, podcasts and social networking. Twitter and Second Life don't get nearly the same levels of use.

iPhone for O2: Zero Margin for Carrier

Mobile operator O2 (Telefonica) reportedly has won the right to sell the Apple iPhone in the U.K. market. It may ultimately regret the victory, as the Guardian reports O2 is giving Apple 40 percent of service revenues.

The other U.K. mobile operators reportedly backed away from the deal as the O2 business arrangement essentially is a guaranteed money loser. O2 of course is gambling it can leverage the deal to take share from its U.K. competitors.

As part of the deal, Carphone Warehouse will act as an authorized retailer for O2 as well. Apple apparently retains control of device pricing.

The deal is part of a number of potential destabilizing developments in the mobile business. It isn't simply who is in the networks business. It also is where value and hence profit are to be made in the mobile ecosystem. Apple thinks it is the phone. Google might think it is the ability to create targeted advertising. Other players, such as satellite TV providers, might see value in the ability to create a triple play including broadband access and voice.

In the U.S. market there is the possibility of bids for 700 MHz spectrum, enough to construct a national broadband network. Google has said it likely will bid, and Apple itself is said to be considering its own bid. Other contestants in need of a terrestrial broadband capability, such as DirecTV and EchoStar, have to be weighing their own options as well.

Buying a transmission network is a costly way to create an application delivery network. But there are precedents. Broadcast TV, radio, cable TV, cellular, paging, satellite TV and telephone networks all were built to provide a single "killer" application. Apple could be looking at 700 MHz as a way of jumpstarting mobile video. Google is more interested in mobile advertising. The satellite providers would gain a terrestrial broadband and voice capability to create a triple play under their own control.

One might question whether any new firm focused on new applications would want the headaches of running a network. One might question whether the advantage of owning a network is really worth what it would cost to acquire spectrum and construct a network. But it is a measure of destabilization that such developments are being pondered.

Separately, T-Mobile is expected to win exclusive iPhone rights in Germany, while Orange wins that right in France. At this point, Apple is betting the device trumps the network. The U.K. iPhone will use the slower 2.5G EDGE network, not the faster 3G network.

Verizon FiOS Getting Ready to Blow Down Doors

Readers of ComputerWorld might not be "typical" U.S. consumers. Neither might members of the ChangeWave Alliance, as both will skew much more heavily into the technological savvy end of the customer spectrum. But there's growing evidence that at least for these lead elements of the technology-buying and influencing market, Verizon's FiOS is poised to take significant share.

Not that "satisfaction" is any guarantee of loyalty, but FiOS customers seem significantly happier than Comcast cable modem customers, for example. And on the "I'm going to switch" front, limited FiOS availability, like limited iPhone stock, has depressed sales. That will change, if ChangeWave member sentiments are any indication.

In fact, of users who say they are going to change video providers, the percentage of users who say they intend to switch to FiOS or another fiber-to-customer service is 300 percent higher than the percentage of users that say they will switch to cable for TV service.

So Verizon and at&t simply have to get their networks in front of more customers.