Kevin Tofel of GigaOm and PC Mag's Sacha Segan are having a multi-mode discussion on devices and networks that cross blogs and Twitter tweets. In one rebuttal Segan tweeted "@KevinCTofel I don't see why fixate on the iPhone. Verizon achieved growth in '09-early '10 with Droid."
To which Tofel wrote and I quote:
"The obvious answer to the question of “what drives carrier sales,” either network or devices on offer, is clearly both. If an operator can offer the “complete package” of stellar devices and a superb network (along with marketing to tout the two and solid support as needed), then we have a winner. But devices do vary by carrier, and there are occasional exclusives where a device is only available to one carrier for at least a limited time."
But I think both missed a key factor in why Verizon has the kind of customer base and growth they are seeing and in reality have seen for years. It's called territory and geography. From it's ealiest days Verizon Wireless was able to sew up the lucrative NE USA corridor between Richmond Virginia and Boston. They had the mobile piece as Bell Atlantic and NYNEX and that's where 25 percent of the USA population and big business has been concentrated. Along the way they picked up GTE which just so happened to have Los Angeles and Orange County and a few other pieces in the late 90's and early 2000's. Those pieces just happened to include some of the most driven parts of the country.
So in essence Verizon doesn't grow because of the Android, and their not growing because of their iPhone. They grow simply because their network is where more people are, and it's been less congested and scaled better using CDMA vs. AT&T and T-Mobile's GSM networks. The VZW network had more tower locations because they grew from being the incumbent or via consolidation.
Now though with LTE they are starting to feel some pain, as they are finding some hiccups along the way first. AT&T is waiting, learning and hoping they won't suffer the same teething pains.
1. Sprint-they have committed to WiMax, and to be perfectly clear-Mobile WiMax. They in effect will inherit the Mobile Wimax technology and have Intel as a development partner. Sprint gets the Mobile WiMax network to replace what was the soon to be mothballed iDen network to do things with. They also have this deep relationship with the cable guys and have for years. It doesn't go away, it becomes the other network because it happens to work very well. It's just not built out yet and the cable guys are ready to sell it..
2. Comcast-they are already into WiFi as is fellow Clearwire investor Time-Warner. Bright House has dabbled with WiFi in parts of Florida so the concept of Wireless is not foriegn to the cable guys, but for the most part they all have been using Verizon and Sprint as partners. All of the cable guys are just waiting to be in mobile and Clearwire as an LTE player will provide them the opportunity. The mobile WiMax is simply the cream on top.
3. There's this little thing brewing called the AT&T-T-Mobile merger. That will create a need to toss off some territory and some spectrum. T-Mobile has this AWS spectrum in the 1700 Megahertz range but it's the bastard stepchild for wireless in North America. The cable guys are used to playing with what's left in general, and know how to make the leftovers become profitable. Between that and some other spectrum in the 800, 850 and 1900 megahertz range AT&T/T-Mobile will be forced to cast off make merger happen, meaning the locations for towers and cell cites (microcells, pico cells and even femto type cells) will be more than ready for a a take over of Clearwire.
4. The cable guys have the cash-and the longstanding Sprint relationship. The cash will fuel the expansion into LTE. Sprint will be the technology behind it, along with their outsourcing deal to Ericsson which just happens to make and build what? That's right LTE network hardware. So there the cable guys get vendor financing, and their partner for network and past mobile deals Sprint.
5. Google--The search giant has been looking for a play in mobile for years. But just like they don't want applications that get installed, they want to be the services for the mobile network and of course sell ads. Now add in the fact that they have devices called Android and can subsize handsets, services, etc. and then be the ad sales giant, they have multiple ways of to make money on this deal, and oh yes, did I also say, they have the cash.
So--what does this mean..well $660 million between Ericsson, Google, Time Warner, Comcast and BrightHouse is a rounding error at the end of the day, espcially if you amortize that over seven years.
In the case of Ericsson, they are also making money from what Verizon Wireless, AT&T and likely T-Mobile today through services, equipment or management of something or other. Plus many other operators around the world. Google via Android has Verizon Wireless, AT&T and T-Mobile selling their phones now.
Talk about a trojan horse strategy, they know and touch everyone of the other MNO's customers. It's called GMail and everyone using an Android has a GMail account, and many likely are getting Google Voice numbers. A long time ago someone wiser than me once shared with then Yahoo VP Brad Garlinghouse the fact that a Yahoo ID was more important than your phone number. Garlinghouse told me that was the one thing they never wanted to push and my sources said it was what scared the mobile operators the most. Well GMail + Google Voice better scare them because if you move your Google Voice number over to you mobile operator which Sprint now does....get the picture.
Oh-and where exactly did Google choose to build their first fiber network? Kansas City, where Sprint is based.
Google + Sprint + The cable companies vs. the Mobile Operators.
Skype's the Big Blog served as the news outlet letting Android 2.2 users know that their mobile client is now on par with Apple'siOS without saying so, as video, at least one on one video, is now available for most Android mobile phones. That's good news, as Skype calls actually are working on the Verizon Wireless network. Sort of.
A quick test this morning revealed how long it takes to set up and connect over 4G on VZW, and a video call took almost 4 minutes for the other parties video to appear, even though I was sending video.
The image also doesn't shift from landscape to portrait mode, another slight bug. Another is the whole user experience of finding contacts, which is not really fluid. There are other issues, but it worked.
Thankfully there's Skype on the iphone, iPod touch and now iPad as I continue to feel that Android is not as good as an OS for developers due to device fragmentation issues. This morning's testing really proved it.
U.S. mobile operator Metro PCS, which was first out with LTE, will deploy VoLTE (Voice over Long Term Evolution) reports Kevin Fritchard of Connected Planet. The public acknowledgement that the new, next generation of cellular voice will be VoIP is in many ways refreshing. For years telecom companies have been shying away from the use of the term VoIP because of it being associated with poor audio quality ala Vonage of old.
Issues aside, it's nice to be seeing VoIP getting it's recognition and as I'm in Dean's camp on the issue, VoLTE and LTE in general will have lots of teething pains to deal with as it rolls out. Just ask any Verizon Wireless LTE customer here in the USA who has suffered through more outages in the past year than they likely ever experienced on plain old CDMA EVDO data.
If there is one app that's not on the iPad yet that needs to be which has been designed from the ground up for it, it's Skype for iPad. Skype despite their acquisition by Microsoft is not a company that is standing still. They are moving forward and with the changes in their management two months ago becoming a reinvigorated company with a more consumer and small business focus. The iPad hits that sweet spot dead on, once the app is out, will likely propel even greater usage of iPads in conversations of all types.
But, we'll just have to wait and see how good it is, and hope to hear why the app had to be removed.