Verizon’s “Open” Network Will Really Be Two-Tiered
Erick Schonfeld
32 comments »
Verizon’s newfound openness when it comes to its wireless network is not all that open after all. As I reported yesterday, Verizon Wireless announced that it would allow “any device” and “any app” to operate on its existing network. But that is not exactly so.
By “any device” Verizon means you can bring any CDMA device to its network. Verizon has a CDMA network, so only CDMA phones will work on it—fair enough. It was always clear about that. But what exactly does it mean by “any app”? I dug a little deeper and asked Verizon whether any of the new apps developed for the bring-your-own devices would also be available to its existing customers who bought their phones through Verizon. The answer for now is, “No.” Although a spokesperson tells me that they are looking into it. Unless it figures that out, Verizon is not really building an open network. It is building a two-tiered network: One for its preferred customers who play by its rules (i.e., its current 64 million subscribers), and one for the rabble not satisfied with its choice of phones and apps.
If there is no crossover capability on the apps, then the “open” part of Verizon’s network will be barren. The appeal of developing an open app for Verizon would be to gain access to those 64 million subscribers. Nobody is going to go through the trouble of creating apps just for the handful of people who want a CDMA phone that Verizon does not already sell. Making the whole open network even less appealing will be the fact that these phones are not likely to be subsidized by Verizon, and thus far more expensive.
Unless Verizon creates at least the semblance of a level playing field between the open part of its network and the closed part (where all the subscribers are), then all the talk about open networks will remain just that. Talk. And Verizon knows how cheap that can be.
Erick,
Did you really expect an open platform? Seriously?
I didn’t.
Great digging on this one Erick. I was waiting for Verizon to make some sort of move to counter Google, but fear of losing complete control of their well moated castle will keep them from really stepping out into the open.
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People will even pay more if they perceive there is a greater value or a deeper reason for buying from one provider over another. I cannot tell you how many times I’ve helped companies step up out of the commoditizing world in which they live by being more strategic. In a moment I’ll have you do an exercise that will really pound this idea home. Let’s do a little more set up so you get as much as possible out of the exercise to follow.
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Chet Holmes has worked with over 60 of the Fortune 500 companies as America’s top marketing executive, trainer, and strategic consultant. Chet is the author of the best selling book, The Ultimate Sales Machine (#1 business book on Amazon, #1 Sales and Marketing book on Amazon, and also on NY Times best seller list). Chet has identified and developed the 12 core competencies that are proven to provide the main structure of truly great companies and he has developed more than fifty proprietary methods to implement them. To learn more about how to double the sales of your company, go to http://www.howtodoublesales.com
How would Verizon implement this? Just because someone makes an app run one one phone doesn’t mean it will run on another. Verizon can have a completely open network and not be obligated to test every 3rd party app on all of their handsets and make an easy install for all their customers right? I mean, is that what’s required before you would be willing to call it open? Phones are not some singular platform that anything can run on you know… I’m no fan of Verizon, but seriously…
Open is bad!
I have been getting a some flack lately from certain sources both within and outside of Redmond: they maintain that there is absolutely no reason why the Zune should not be able to auto-sync with iTunes on any platform! They say;
“open it up Steve, open it up!”
Let me just say it this way, whenever anyone says to me, “open it up Steve”, I know what they plan to do next!
I am not falling for it!
http://fakesteveballmer.blogspot.com
It seems like a good start to me. Let the other “open networks” take on the load to drive out what apps are in demand and warrant support in their network. Verizon’s consumers can always move to open devices as they see fit. Once an open app gains sufficient traction and has proven to be stable, Verizon can elect to extend and support these now proven apps in their network.
Interesting. It’s also interesting that following on the heels of this announcement, Canada recently opened up their own wireless industry to ensure greater competition as well as fair opportunities for emerging providers to compete against the huge existing providers.
http://www.cbc.ca/money/story/.....ction.html
I haven’t been impressed with the TechCrunch reporting lately — namely this story and the Google court issue also reported recently. This seems like awfully fickle reporting (i.e. little fact checking) before running to press. I think TechCrunch can do better.
Great article. I agree that Verizon’s network won’t really be open. There will be far fewer handsets for new mobile web apps to get into than expected. Most of those 64 million (unfortunate) subscribers will still be off limits to mobile application developers. That is a pity.
“The appeal of developing an open app for Verizon would be to gain access to those 64 million subscribers.”
The above statement seems to suggest that if I buy an Android phone and use it on Verizon’s network, I won’t have so many good apps to choose from, because developers won’t want to develop “Verizon apps”. True that some location based services are specific to some mobile networks, but in general mobile applications are developed for operating systems or other software platforms such as J2ME or BREW. Twitter/Dodgeball/Mobile MSN Messenger/Mobile Firefox/etc. have little to nothing to do with any specific mobile network.
I don’t read that that way at all. I understood the opening to be strictly about the network…that is, the towers spread out around the nation. Imagine non-phone devices using this data network. Think Kindle-competition.
That’s how this announcement always sounded to me, and is in my opinion the best idea anyway. Geez.
I don’t know how you can call the fact that current Verizon phones will not be able to run ‘open’ apps a two tiered system?? Two tiered implies that one tier will get special treatment; this is not the case. Open phones get to use the network just like the Verizon phones.
Bottom line is that Verizon has every right to choose what software runs on a ‘Verizon’ phone. Just like any new phones will have a right to set up their own apps. Consumers will migrate to the phones with the best value proposition. Verizon can keep their phones ‘closed’ at their own risk.
I don’t understand. How can Verizon prevent apps from being run? If the devices have access to Verizon EVDO, and thus the Internet, how can Verizon prevent users from using whatever app they like?
Please Please google, buy sprint , then buy the 700 mhz spectrum.. save the US from from technology obscurity, where we are already years behind asian and european counties. Please save us google.
Running apps on other devices gets into other issues… for instance, most of Verizon’s current models are BREW handsets, while many popular apps (such as Opera Mini) run on Java (Opera is available for other platforms, but not yet for BREW).
Of course, even with current handsets, there are ways to hack them if you’re the kind of person who wants other apps.
Anyway, I’m not sure how Verizon could really pull off the level of “open” you’re talking about. Take this sentence: “Nobody is going to go through the trouble of creating apps just for the handful of people who want a CDMA phone that Verizon does not already sell.” If someone creates a Java app, those running a Java CDMA phone will have access, and most of the people buying Verizon’s phones won’t.
Who is going to import a low end crap Korean phone or use a give away phone from Alltel or Sprint? Those are the non-brew phones that will be left out in the cold.
The people that will benefit from an open network are those looking for higher end smartphones. For example, I would have liked the HTC Mogul 6 months ago when it landed at Sprint. Nothing brew on a WinMo phone.
What a bummer … when one of my employees told me about Verizon opening up I got excited. And then … the “real” info comes through different channels and you get what really is going on … and … again .. what a bummer.
Imagine an open network … you just need the SIM card and off you go. The potential there is enormous. And on an open network, the carrier stands to make A LOT of $$$$ just from subscription and fees alone. Imagine what other deals and slices can be created to supplement the basic revenue.
Like I said before, this is to make Verizon Wireless seems more open and gives them an edge in bidding for the 700MHz spectrum.
Notably, I’d like a Verizon Wireless customer accessible GPS app. Since VZW disables it on their Blackberrys.
Yep, still evil: http://community.eqo.com/blog/.....still_evil