Video Killed the Radio Star: 2010 Telephony Edition

One hundred and twenty-six years after Alexander Graham Bell patented the telephone, AT&T, America’s largest provider of fixed telephony (and third largest non-oil company in the US, behind WalMart and Bank of America) may finally lose its iPhone stranglehold.

Rumors abound that Apple is about to open the iPhone to the Verizon network. “Verizon-friendly iPhone” rumors surface every six months or so. But this time, both the New York Times and the Wall Street Journal are reporting that the handset is coming. They’re getting this information from people who are “in direct contact with Apple” and who “don’t want to be identified” because they could “alienate” their contacts.

All this buzz comes on the heels of two lawsuits in California addressing Apple’s secret five-year contract with AT&T. This summer a federal judge allowed a class action suit to proceed, consolidating many iPhone buyers’ allegations of monopoly abuse against Apple and AT&T.

Competition suits merely scratch the surface of Apple’s battle with Google over intellectual property in smartphone technology. Not to mention suits over the notorious “no no spot” that disables iPhone’s antenna with one touch.

It’s been a long year for Apple. Droid’s debut on the Verizon network captured many would-be iPhone customers who waited for an alternative to AT&T’s infamous record of dropped calls and missed connections.

Sure, we can get a blackmarket T-Mobile iPhone hack. But who wants to live like a refugee?

In technology markets, late movers tend to prove the most loyal customers. Apple will not hold its breath to woo Droid users away from Google. Yet now that Droid and Apple apps emerge almost in tandem, the most distinguishing feature between these two products is the network.

Once the most important part of phone choice, network dependability fell second to gadgetry during the rush to innovate in the past ten years. Yet with ubiquity comes responsibility; “I’m on a mobile” no longer excuses dropped calls. In this post-landline era, where even emergency operators at 911 receive 30% of their calls from cell phones, network dependability is once again paramount.

Mac has long couched confidence in its superior product in keeping switching costs  to Apple products high, while costs to switch from Mac stay low. Apple computers can run Windows programs as well as any PC can, but only Mac users can run Mac operating systems. Even new iPhones come with a thirty-day money-back guarantee. That’s a guarantee on both the phone and the contract.

Just try wiggling out of a Verizon contract after 30 days! Mac’s message comes loud and clear: Why would anyone switch back?

Evidently Mac users have begun switching back because they’re tired of closed-door contracts and anticompetitive measures from on-high. Long the “boy who cried wolf” of tech rumors, this time Mac would be wise to open the network to Verizon in real life, ending at long last the monopolistic Apple-AT&T “marriage made in hell.”



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