Welcome to the Slashdot Beta site -- learn more here. Use the link in the footer or click here to return to the Classic version of Slashdot.

Thank you!

Before you choose to head back to the Classic look of the site, we'd appreciate it if you share your thoughts on the Beta; your feedback is what drives our ongoing development.

Beta is different and we value you taking the time to try it out. Please take a look at the changes we've made in Beta and  learn more about it. Thanks for reading, and for making the site better!

Cell Phones Becoming Profitless

CowboyNeal posted more than 10 years ago | from the imploding-markets dept.

Communications 498 writes "EE Times has a fascinating article on how electronics companies are being sucked into a profitless spiral by the cell phone market. More and more of the small consumer gadgets are being folded into the phone: camera, music player, PDA, GPS, etc. So the market for non-phone gadgets is slowly going away as the phone picks up more functions. However, consumers don't buy most phones; they are given away (or sold very cheap) by the service providers as hooks to get people to sign up for mobile service. So the service providers are demanding (and getting) rock-bottom prices for fancy phones they can give away, and the micro chip companies are forced into brutal competition for a market that is shrinking into a single commodity gadget, the phone."

Sorry! There are no comments related to the filter you selected.

Great (-1, Troll)

Anonymous Coward | more than 10 years ago | (#9839462)

Death to cellphones.

Good! (0, Flamebait)

Anonymous Coward | more than 10 years ago | (#9839466)

Maybe the cellphone companies will all go bankrupt and we won't have to put up with annoying idiots blabbering away in every place imaginable.

Re:Good! (2, Funny)

miskatonic alumnus (668722) | more than 10 years ago | (#9839482)

Oh, just you wait until you get to hell. Mmwahahaha!

Forward to Steve (5, Insightful)

SYFer (617415) | more than 10 years ago | (#9839468)

In the article, it was suggested that disk-based media players like the iPod aren't immediately threatened by this "death spiral" (unlike flash-based players which could rapidly become toast as phones eclipse their abilities) and that got me thinking about the root problem of customer expectations. The cell phone companies clearly blew an opportunity when they initially treated the hardware as a loss leader. It's hard to get that genie back in the bottle. People today will pay for a crap flash MP3 player or low-to-medium-end digital camera, but balk at paying a premium for a mobile phone with loads of features.

Perhaps a marketer like Apple can break through with an enhanced phone product that will create a demand that outweighs the current expectation on the part of consumers that phone hardware is free (as in beer) or nearly free. This is right up Apple's alley.

The Motorola deal may be a trial balloon for Apple. Imagine the full capacity and function of the mini iPod married to a full-featured phone. Add to this the stylish design that Apple would strive to achieve and I think you have something that can break this "death spiral."

Crossing the Chasm (5, Interesting)

iendedi (687301) | more than 10 years ago | (#9839517)

Cell phones are in the process of crossing the chasm between phones and replacements for your PC. Until this job is complete, margins will be way down.

In three years, I will bet anything that you will be able to connect a bluetooth mouse, keyboard and some sort of monitor to your cell phone (probably via it's charging cradle). For most users, these devices will be powerful enough to toss their PCs for good.

But to get there, the industry is running uphill at a breakneck rate - features and technology are going nutz - it is EXPENSIVE to make this transition.

Re:Crossing the Chasm (1)

nFriedly (628261) | more than 10 years ago | (#9839558)

i fully believe that thats possible, but i doubt it will happen in 3 years - i think it will take a little bit longer

Re:Crossing the Chasm (4, Insightful)

iendedi (687301) | more than 10 years ago | (#9839608)

So did I until I bought this []

Now, I think for most tasks, I could probably replace a PC now if the damned thing could be connected to a monitor (you can already connect a bluetooth keyboard)...

Considering that, I think three years is not a stretch at all...

Re:Forward to Steve (0)

Anonymous Coward | more than 10 years ago | (#9839619)

I would so rather pay a premium for a great cell phone in order to get cheaper service.

Phone upgrade addiction (5, Insightful)

erice (13380) | more than 10 years ago | (#9839667)

The cell phone companies clearly blew an opportunity when they initially treated the hardware as a loss leader.

An opportunity for what? Remember, it is the service providers that treat phones as loss leaders. They do it to ensure customer lock-in. If phone are sold instead of given away, the profit will go to the retailers. The service providers still won't make money on phones and their customers won't be willing to sign up for a 2 year contract.

The current situation is bad for manufacturers because bargaining power is concentrated in a handful of service providers. If they sold to consumers, there would be more room for product differentiation, marketing, and profit.

Re:hardware as a loss leader (4, Insightful)

ShieldW0lf (601553) | more than 10 years ago | (#9839712)

People today will pay for a crap flash MP3 player or low-to-medium-end digital camera, but balk at paying a premium for a mobile phone with loads of features.

Personally, I'd be happy to get a good phone for free, but there's not a chance in hell i'd sign one of those long-term contracts they have on offer. Your circumstances change, your free phone ends up costing you a lot of money. Happens to most ppl i know that sign up.

I think I'll pay for my phones thanks...

Just as it should be. (1, Insightful)

Anonymous Coward | more than 10 years ago | (#9839472)

Whats that? The market at work?

History repeats itself (3, Insightful)

secondsun (195377) | more than 10 years ago | (#9839476)

This is similar to the cr industry in the late 20's-early 30's and the rail road industry. Both of them commoditized and competed themselves into fewer companies until the last ones left were profitable.

Re:History repeats itself (4, Insightful)

shird (566377) | more than 10 years ago | (#9839736)

exactly, simple supply and demand. Theres no such thing as a profitless business. A profitless business folds and the industry keeps shrinking until there there is just the right amount left that they are left making a profit.

If theres room for more companies, the industry grows, if not, it shrinks.

In any case, the providers arent exactly 'giving away' phones with 4 megapixel cameras and PDA functions. They cost a bundle, and I am sure they are making a tidy profit on those.

More likely, people buy phones with crappy 320x200 cameras, then fork out again to buy a 3mp camera. So they pay for a camera twice, and the industry gains. So.. stfu article writer!

No, I did not read the article... (3, Insightful)

heyitsme (472683) | more than 10 years ago | (#9839479)

But if the summary is right, the let me be the first to say BULLSHIT!

No way in hell I'd trade my 4 megapixel camera for a shit 320x240 phone picture JPEG'd to hell.

Well, maybe this is true for the PDA part.. but most PDA users have gadget fetishes anyways.

p.s. fp?

Re:No, I did not read the article... (5, Interesting)

maxbang (598632) | more than 10 years ago | (#9839568)

My thoughts exactly. I did rtfa and I don't buy it. Much like the all-in-one printer/scanner/copier/phone/fax/kitchen sink devices out there, I'd much rather have a few gadgets which do their job excellently than one which does several jobs in a slip-shod manner. I don't like camera phones. They're slow and have horrible resolution. The PDA/phone hybrids are much too large to carry comfortably in my pocket. I'm completely happy with paying $150 for my small cell phone which gives excellent reception in most locations, a couple more hundred for my digital camera, and some more hundreds for my Neuros MP3 player. And, most of my friends feel the same way. Some day when miniaturization and overall quality of such products improves, then I'll reconsider.

Re:No, I did not read the article... (2, Insightful)

ejaw5 (570071) | more than 10 years ago | (#9839697)

I doubt there'll ever be a camera-phone that'll have a lens with aperture of f/2.0 or larger, minimum barrel distortion and chromatic aberration unless they make the phone much larger than todays models to accomodate the larger lens. Plus the cost of such an optics system that provides quality for higher resolution sensors would most likely dominate the cost of phone manufacture. Also can't imagine being able to set exposure values efficently using a keypad to dive through control menus.

I'll stick with my higher-featured (marketing translation:prosumer) digicam...until I get my hands on a dSLR.

Re:No, I did not read the article... (0)

Anonymous Coward | more than 10 years ago | (#9839628)

Every time you say fp? you should be stabbed in the throat. Get over it you piece of rat shit, it doesn't make you cool, it won't get you laid, and you'll never get props. Hopefully you will get mugged tomorrow and shot in the nuts accidentally, then your stain on this earth will only be temporary.

Re:No, I did not read the article... (-1, Flamebait)

heyitsme (472683) | more than 10 years ago | (#9839675)

p.s. fp? is about 100 characters shorter than your worthless depressed rant. Get some prozac, loser.

The customer is always right? (2, Interesting)

Daniel Ellard (799842) | more than 10 years ago | (#9839640)

I agree... there's no way I'll trade a good camera, a high-fidelity (and high capacity) music player, etc, for the crappy counterparts that are in phones nowadays. (The only area in which they come close is PDAs, as you wrote; I'm almost ready to trade in my original Palm Pilot for a tiny phone -- but I am not quite ready to trade graffiti for keying in text on a telephone keypad!)

Unfortunately, we might not have much choice. If the cell phone gadget market kills the other markets and then is squeezed itself by vanishing profit margins, then we'll all pay the price for getting "free" phones many times over. Unfortunately, short-term price always seems to trump long-term quality in commodity markets.

Re:No, I did not read the article... (2, Interesting)

Ranma21 (651226) | more than 10 years ago | (#9839656)

Sorry dude, they have 3M pixel cameras with optical zooms in cell phones here in Japan NOW. Oh, and PDA functions as well...and err I should mention MPEG4 video (to SD card) recording as well. I guess you'll get them next year... maybe.

Re:No, I did not read the article... (4, Insightful)

ipfwadm (12995) | more than 10 years ago | (#9839704)

Sorry dude, they have 3M pixel cameras with optical zooms in cell phones here in Japan NOW.

I've already said it [] , but I'll say it again. Megapixels are a myth, just like megahertz. Your 3MP phone camera isn't going to get nearly the image quality as a 3MP dedicated digital camera. Read my other comment for more info.

Re:No, I did not read the article... (1)

Trejkaz (615352) | more than 10 years ago | (#9839733)

Unless, of course, someone like Canon start making those integrated cameras which come with the phones.

Re:No, I did not read the article... (5, Informative)

ipfwadm (12995) | more than 10 years ago | (#9839790)

Unless, of course, someone like Canon start making those integrated cameras which come with the phones.

It doesn't matter who makes it. There are physical limitations of optics at work here. Correcting for aberrations takes a lot of glass, and glass isn't particularly light. There are currently limitations in the sensors such that larger sensors give better quality than smaller sensors. This will probably always be true to some degree or another (large format film camera give better results than 35mm, but for most of the market, who cares?). Sure, phone cams could potentially someday be enough for a lot of people, but they will NEVER take over the camera market as a whole. Just imagine holding a phone w/ attached 5 pound telephoto lens up to your ear.

Re:No, I did not read the article... (1)

Trejkaz (615352) | more than 10 years ago | (#9839809)

Well, people were still willing to hold the N-Gage up to their ear, so 5 pounds of camera making someone look like a dick probably isn't much worse. :-)

Re:No, I did not read the article... (0)

Anonymous Coward | more than 10 years ago | (#9839798)

Not to mention lens quality and limited focus range. Those can have _big_ effects on picture quality (If you can't get the picture in focus, it'll look like a high-res blur :) Not to mention the lack of zoom and really advanced features (e.g. image stabilization) on camera phones.

Yes, dedicated digital cameras are still way ahead of the all-in-one phone. On the other hand, how many people really need more than basic PDA functionality? An address book and a calendar is more than enough for most people. That's why PDAs probably will get integrated into cell phones, if anyone is willing and able to manufacture the cheap components.

Re:No, I did not read the article... (1)

glesga_kiss (596639) | more than 10 years ago | (#9839663)

Give it time. Jeez, how much have we seen existing electronics shink in size and become cheaper over the past 20 years? Given that again, I'd say that phone cams will kick the ass out of any existing consumer digicam.

Re:No, I did not read the article... (1)

PierceLabs (549351) | more than 10 years ago | (#9839722)

Sorry, but you're like almost 2 years behind with that comment. New phones have 1.x megapixel cameras at the LOW end. LG [] and Samsung [] both have 3.x megapixel camera phones coming out as well.

Face it - its all getting merged into one device for most people. Within the next 18 months your 4 megapixel camera will be a feature on a camera phone or something similar to a Sony P900 or Treo600. You'd be amazed how far these phones have come - some of them are reasonable replacements for laptops for many people and the processors (currently in the 300Mhz-400Mhz range) are only getting faster.

One for all... (2, Interesting)

pointzero (707900) | more than 10 years ago | (#9839483)

I welcome this trend towards ONE peice of equipment to do everything. This will allow me to carry one peice instead of a camera (and it's respective bag, accessories etc.), a phone, a pda, a computer, a music player, a note taking device etc...

Re:One for all... (0)

Anonymous Coward | more than 10 years ago | (#9839527)

And for this reason I fervently wish that handbags could become a perfectly acceptable male fashion accessory.

Re:One for all... (4, Insightful)

casuist99 (263701) | more than 10 years ago | (#9839533)

I welcome the trend, too, but there's always a "primary" device. In this case, it's a phone with a camera built in. The main functionality of the device is to work as a phone. It doesn't matter if the camera sucks, that's not the primary use of the device is.

I don't want to hold a really really heavy device to my ear to hear the phone because it has a gigantic hard drive built into it. And there's no way that a phone-integrated digital camera is ever going to really replace the high-end markets for other devices (think digital SLR, powerful computer, etc).

There's some integration of devices going on now, but it's always a crippled integration. The trend is encouraging, but I'm not sure it's ever really going to lead to anything.

Re:One for all... (1)

vantango (719830) | more than 10 years ago | (#9839732)

Sure.. but when I pay for the phone, don't expect me to pay extra for a crappy inbuilt camera.

Re:One for all... (4, Insightful)

casuist99 (263701) | more than 10 years ago | (#9839791)

Exactly. The thing that worries me about the trend is that it might become impossible to buy a device that is ONLY that specific device. I mean, technically you're committing a crime if you bring your cellular phone with a camera built-in to a movie theater in certain jurisdictions.

I want to be able to get my cheaper, smaller, thinner, better call phone without crap in it.

Re:One for all... (1)

ipfwadm (12995) | more than 10 years ago | (#9839545)

I welcome this trend towards ONE peice of equipment to do everything. This will allow me to carry one peice instead of a camera (and it's respective bag, accessories etc.), a phone, a pda, a computer, a music player, a note taking device etc...

I don't. As the saying goes, "jack of all trades, master of none." When I see people taking pictures with their phone, I laugh. The quality you can get out of those things doesn't come close to what you can get out of a dedicated digital camera, let alone what I can get out of the digital SLR I just bought. And sure, phone cameras may someday be able to get comparable resolution, but megapixels are just as much of a myth as megahertz. Nobody will want to carry around a phone that's big enough to have a sensor big enough to be capable of taking a good picture.

Re:One for all... (1)

NoMoreNicksLeft (516230) | more than 10 years ago | (#9839740)

Yes, but when I set up my own custom home alarm system sometime soon, I won't want to pay a dumb alarm company. Barring some breakthrough in artificial intelligence, there is only one other way to know if the house is on fire or if the thermostat is just stuck. My central computer cellphone's me an image, and I confirm it... then it dials the fire department and and plays an automated message.

If it is some false alarm, I deny it, and I can wait til the evening is over to figure out why it went nuts.

Of course, you don't need the camera functionality so much as the image display and networking capabilties. Just saying though, there are cool things to be done with it.

Re:One for all... (1)

ipfwadm (12995) | more than 10 years ago | (#9839803)

I agree with you that that is an interesting application, but certainly not one I would want to trust with a $20 camera :-)

Re:One for all... (0)

Anonymous Coward | more than 10 years ago | (#9839770)

No, the quality of camera phones isn't high enough if you're a professional photographer, or even if you're just a dedicated hobbyist. But guess what: the other 95% of the population doesn't give a shit, they just want to have a neat picture to show their friends who also don't give a shit about the picture quality. That being said, I hope to never buy a phone with a built in camera, I don't need a fucking camera, and I don't want a fucking camera.

Re:One for all... (0)

Anonymous Coward | more than 10 years ago | (#9839680)

What kind of dork carries all that shite? What could you possibly need all of that crap for at the same time?

Cheap my eye (4, Insightful)

dacarr (562277) | more than 10 years ago | (#9839485)

Look, a digital camera that's decent might cost a pretty penny, but the digital camera I get with a cellphone doesn't get the resolutions of a digicam I can buy separately (yet). Then there's the issue of storage - the "storage" for the phones I'm not sure about, but then there's bandwidth issues in that, last I checked, they still charge for bandwidth.

Re:Cheap my eye (4, Informative)

PeterChenoweth (603694) | more than 10 years ago | (#9839581)

SprintPCS does not charge you for the amount of data used. It's a flat $15/month for Vision, which gets you unlimited internet at about 10-15K/sec download speeds. Storage isn't an issue on my Treo 600. The built in memory can handle 300+ photos, and I have unlimited storage on Sprint's picture servers. The couple of SprintPCS Picture phones I've had the pleasure of using could save 20-40 photos internally, but of course there's unlimited storage when you upload there too. But yeah, the camera is crap compared to a real digicam. When I want to take photographs, I bring along my 5mp Minolta Dimage 7HI. When I just need to take a picture of something interresting and get it to anyone I want quickly, a cell-phone cam is very handy.

Re:Cheap my eye (4, Insightful)

ipfwadm (12995) | more than 10 years ago | (#9839605)

the digital camera I get with a cellphone doesn't get the resolutions of a digicam I can buy separately (yet)

Repeat after me folks: megapixels are just as much of a myth as megahertz.

There are plenty of cases where a manufacturer has slapped a 5 megapixel sensor into a camera that was originally designed for a 3MP sensor, and the picture quality actually decreased.

Lenses, sensor pixel size (a 35mm full frame sensor at 6MP will deliver far better quality than the tiny 8MP sensors found on point-and-shoots), image processing, etc are all far more important to image quality than megapixels. And there's just not enough room in your pocket for a phone that has a decent lens and a big sensor.

Re:Cheap my eye (1)

glesga_kiss (596639) | more than 10 years ago | (#9839611)

but then there's bandwidth issues in that, last I checked, they still charge for bandwidth

Most phones can sync without cost directly to a PC, via serial, usb, ir or bluetooth. Some are even getting wifi now. This is how you get music/video on and off.

However, I believe that the first phone to break the megapixel barrier didn't allow this and you had to pay to get the images.

Who hates that all-in-device (5, Insightful)

pio!pio! (170895) | more than 10 years ago | (#9839487)

A PDA on my phone just makes my phone bigger/ thanks.

I can fit my phone in my pocket, I dont want to have a huge slab of metal in my pocket, just a small thing that is portable and unobtrusive.

If I wantd a PDA I would have bought one..same w/ digicam and music player.

Anyway integrated devices are usually inferior to their standalone counterparts.

Who's with me? Keep those devices separate!

Re:Who hates that all-in-device (1)

timmi (769795) | more than 10 years ago | (#9839575)

Personally, I have only a handful of numbers stored in my cell phone. The rest are stored in my Sony Clie.

I have the Clie in my left pocket, my flip-phone and my keys in the right pocket, and my iPod on my belt. Works great for me.

I can see there are advantages to having a camera in your phone, but I would rather have a ~2.1 Megapixel camera with an optical zoom personally.

Re:Who hates that all-in-device (4, Insightful)

buzolich (582360) | more than 10 years ago | (#9839578)

I hate to say it but I'm in the camp that just wants a small cell phone that works. No camera, no PDA, no backrub, just phone calls. It's cliche but that's what I want.

Re:Who hates that all-in-device (1)

carrowood (325102) | more than 10 years ago | (#9839741)

I agree; No frills, just a great phone and a way to sync my addressbook...

Integration does have some benefits. (2, Interesting)

Trejkaz (615352) | more than 10 years ago | (#9839782)

I'm all for that, but since I also need a PDA, what do I do about the contact lists? Does the PDA have the definitive list, or does the phone have the definitive list?

Obviously the phone needs the list, otherwise you have no phone numbers to call. But if you only use the phone to enter all contact information, you're constrained to the tiny screen. And manually syncing the two every time one or the other gets new information is a horrible idea.

Since a PDA-sized phone is about as undesirable as a phone-sized PDA, I figure the only true way to solve this problem is to get the Bluetooth working so well that you can configure the phone to pull the list from the PDA if it can find it in its vicinity. That way, you only have to manage the list on the PDA, but the phone still has complete access to the list.

A pda on your phone makes it bigger... hmmm (1)

way2trivial (601132) | more than 10 years ago | (#9839616)

why? (btw, I own a palm phone,-7135- yes it's big, just like my previous phone, a 6035)
picture this== pda phones that require connectivity for PDA and computational function..

yes, a dumb terminal (vt100ish) cell phone PDA.. something that goes on quickly, and just passes button presses to the service, and the service passes video to the phone.... HMM..
bandwidth needs jump a little sure--

is this any crazier than a neat slashdot post about 10gig ethernet supplying full screen video to a 'dumb' pc?

Re:Who hates that all-in-device (1)

ironring (598705) | more than 10 years ago | (#9839689)

I suppose you own dolby 5.1 components. Separate pre-amps, power amps, tuners etc.

Eventually the integrated systems will be much more than adequate for 99.99% of the population.

Assimilation is inevitable. Resistance is futile.

Re:Who hates that all-in-device (1)

pio!pio! (170895) | more than 10 years ago | (#9839751)

yeah but at what price?

Home theater in a box is nice for the masses...but at least it doesn't make the size of the system any larger than doing it piecemeal.

With portable devices..integrating them together either means making it HUGGE (PDA phones? urg..ever see sidetalkin? :P ) or compromise.. (ie really crappy digicam)

Hey..if they can make a Wireless phone/PDA/digicam/mp3 player that is the formfactor of my small Samsung flip phone, w/ a screen that somehow folds out to be the size of an Ipaq, a 3-4 megapixel cam, w/ a good DAC and mp3 decoding chipset...and also have very good battery life, doesn't weight a ton..I'd buy it...

cunts (-1, Troll)

Anonymous Coward | more than 10 years ago | (#9839488)

you americans are lovely people.

you suck, which is ALWAYS lovely.

Very misleading and uninformed (3, Informative)

adzoox (615327) | more than 10 years ago | (#9839490)

Most cellular services providers take the loss on phones NOT the manufactuer - they make this up by locking you into a contact and hoping you either go over in minutes or buy a plan that makes them money - which 75% + do.

I know this because I had a girlfriend that worked for phone acquistion and deployment for Cingular. THEY almost ALWAYS paid full wholesale price for the phones. The Ericcsons they used to give away cost them $45 each. They cost Ericcoson something close to $19 to make.

Re:Very misleading and uninformed (1)

T-Ranger (10520) | more than 10 years ago | (#9839543)

Your missing the point.

Yes, Cingular pays wholesale prices for phones, but the wholesale price that Cingular pays, and the wholesale price that Bob Cell Phone shack in the mall pays are radicly different.

Re:Very misleading and uninformed (1)

drinkypoo (153816) | more than 10 years ago | (#9839742)

Bob Cell Phone shack in the mall doesn't pay wholesale. Wholesale is when you get the stuff from the manufacturer. Bob Cell Phone shack doesn't get the stuff from the manufacturer, they get it from a third party which marks the phones up before reselling them, and rightly so.

Oh and, it's not "Your missing", it's "You're missing". HTH, HAND.

What's the difference? (0)

Anonymous Coward | more than 10 years ago | (#9839793)

You don't buy a cell phone from Cingular, you buy it from Bob's Cell Phone shack THEN you get a rebate from the manufacturer who gets reimbursed from Cingular.

Bob's Cell Phone Shack gets subsidies from the providers based upon the numbers of signups.

Re:Very misleading and uninformed (1)

autarkeia (152712) | more than 10 years ago | (#9839802)

But this article is aimed at small manufacturers of ASICs and IP vendors, which it is saying are being squeezed out of the market because of relentless pressure to cram everything into a cell phone, meaning their customs ASICs are not longer needed for the previously individual devices. I don't think the article says anywhere that the handset manufacturers are being squeezed, and aside from Nika thier recent earnings would bolster this assertion.

How about just a phone that works? (4, Insightful)

Thorizdin (456032) | more than 10 years ago | (#9839493)

Ughh so this is the reason I can't get a phone thats _just_ a damn phone?

Re:How about just a phone that works? (1)

OS24Ever (245667) | more than 10 years ago | (#9839556)

No Doubt! It's to the point you can't buy a phone without a camera almost. We've got hardware development areas that are camera restricted and now you have to leave your phone in your desk before you can go into the lab!

What's the point in having a mobile phone then? not much.

Re:How about just a phone that works? (1, Insightful)

Anonymous Coward | more than 10 years ago | (#9839565)

Sort of agree, but I still have my wants with a phone, namely:-

Address Book:- Names, contact numbers, Address, Important dates related to the people

Tetris:- Only game worth playing on a phone

Bluetooth:- For trading info

And that's about it

Re:How about just a phone that works? (1)

timmi (769795) | more than 10 years ago | (#9839600)

Actually, when the battey on my 2+ year old phone died, I got a new flip-phone with a color screen, and external display, for $20 with a contract renewal.

Service options got in my way (1)

TWX (665546) | more than 10 years ago | (#9839511)

I was all ready and willing to buy the Kyocera 7135 [] , a Palm-based phone that retails with service for $499, until I found that only two really expensive services supported it in my area. By itself it would have been almost $700, and that wasn't worth it, and most of the services that I was interested in couldn't use it anyway. If you think about the way that people use cell phones, as address books, entertainment devices, and information stores, this idea made sense back to the old Qualcomm pdQ Smartphone (built by Kyocera even) and if more readily available would make sense. Something like that might even help the manufacturers, since they could charge a premium for a high quality phone that would be usable for many, many years, instead of these crappy ones that break easily and are more of a commodity trend than anything else.

Re:Service options got in my way (1)

PeterChenoweth (603694) | more than 10 years ago | (#9839610)

Check out eBay for a 7135. They can be found brand new for around $300-$350 there. Just be sure you buy one that's branded for the provider you choose (Verizon or SprintPCS)

This post made me laugh (1)

Rupan (723469) | more than 10 years ago | (#9839515)

Hmm. I get raped every month by my cell phone bill, and I think that millions of other people do as well. Its good to know that it isn't just the consumer that the cellular providers are squeezing! Maybe the providers will eventually stand up for themselves... but that makes me worry that the providers will pass the cost on to me.........

Pre-paid wireless (2, Funny)

iendedi (687301) | more than 10 years ago | (#9839529)

Do what I did - get prepaid wireless (T-Mobile has a good plan). Besides only paying the carrier when you feel like it (rather than every month), you also don't have those pesky bills coming in the mail telling your girlfriend who you were on the phone with ;-)

Re:Pre-paid wireless (1)

Tezkah (771144) | more than 10 years ago | (#9839595)

Yes, we'll think about that in a few years, but in order to get out of the goddamn phone contract, you have to spend lots of money. Oh well...

Price of phones (1)

eth00 (612841) | more than 10 years ago | (#9839526)

I was just talking about this with an Australian friend. Here in the US most phones are pretty cheap but over there the prices are horrible. A very low end and basic phone will run around $700. Now I am not sure on exchange rates of if they were talking in Australian/US money but the point it the prices are much higher.
Hopefully the cell phone companies do not start raising the prices of service. I can stomach a new phone if I had to but the current trend of inexpensive phones that you replace frequently works for me.

Re:Price of phones (0)

Anonymous Coward | more than 10 years ago | (#9839693)

your friend lies... $700 will get you a Nokia 6230 which is not low end or basic!

Re:Price of phones (1)

dstillz (704959) | more than 10 years ago | (#9839708)

$700 AUD is about $490 USD.

NEWS: Companies Make Smaller Profit (0)

Anonymous Coward | more than 10 years ago | (#9839538)

boo hoo hoo.

Oh valiant corporations, I cry for thee, stabathed in the heart by consumers ugly greed.

boo fucking hoo.

In other news... (1)

nacturation (646836) | more than 10 years ago | (#9839540)

Sales in the horseless carriage market is declining due to this new-fangled device known as the "automatic mobility", or automobile. Horseless carriage manufacturers are crying foul as many features of their products are getting integrated into these new all-in-one devices.

Yep.... It looks like capitalism is still working (4, Insightful)

Spoons (26950) | more than 10 years ago | (#9839546)

So, what you are saying is competition causes a decrease in price and an increase in product features which benefits the consumer? Looks like the free market is still working.....

We've seen this before in the PC card market (5, Insightful)

rrangel (791703) | more than 10 years ago | (#9839549)

Remember when you had to BUY a sound card for your PC? What about paying $200 for modem card? NIC? Video card. Now you get the kitchen sink on most motherboards. And the components are pretty decent.

This seems to be par for the course. If the process can be put on a chip then function consolidation will surely follow.

Re:We've seen this before in the PC card market (3, Interesting)

Trejkaz (615352) | more than 10 years ago | (#9839686)

In the case of a PC, the integrated motherboard costs less than the original motherboard, a sound card, and a network card.

In the case of a phone, the integrated PDA+phone is far more expensive than a much better PDA, and a phone.

If only this weren't true, I would be a happy, happy person right now, as I'm looking for a new phone and a new PDA, and am hating that I can't afford the combined systems.

Re:We've seen this before in the PC card market (1)

Epistax (544591) | more than 10 years ago | (#9839788)

In your example you're taking a bunch of things that were physically attached to eachother-- nay-- non-functioning without eachother, and comparing this to combing a phone, mp3 player, PDA, etc... Sorry I don't buy it.

I don't want a PDA, mp3 player, etc. While I know my phone is free with a plan, I know the monthly cost is where I am paying for my phone.

Surely this has to change... (2, Interesting)

FalconZero (607567) | more than 10 years ago | (#9839550)

As a business model this works while its still profitable for the phone companies to discount the phone and expect profit from the contract. But what about when everyone already has a contract? (as will happen when all people who want a phone have one. IE - When the market reaches saturation). (And this isnt as far off as you'd thing). People are far more likely to upgrade their phone than their contract, so theres no additional profit to be made for the telco in discounting upgrade handsets.

boo hoo (3, Interesting)

SuperBanana (662181) | more than 10 years ago | (#9839551)

the micro chip companies are forced into brutal competition for a market that is shrinking into a single commodity gadget, the phone.

Free country, free market, free economy. If you don't like the heat- get out of the kitchen. Nobody's forcing you to sell low-margin products, and they have nobody to blame but themselves if they're only making stuff for cell phones. It's not like they woke up one morning and said "oh my gosh, someone changed our product lineup to be just stuff for cellphones!" Furthermore, I don't really believe it- plenty of semiconductor companies make stuff that has absolutely nothing to do with cell phones.

If it -is- true, who's to say this shakeup is a bad thing? That's the wonderful thing about a competitive market- if a company can't make a profit on a device, they won't make it. If there are too many companies making a widget, the price will go low and only the strong companies will survive.

The fantastic thing is that if the strong companies start to suck, well- a market forms for an competitor because there will be something to differentiate their product. Not only that, but if it's better- they can price it higher, and (gasp!) make more money!

Raising the Bar (5, Insightful)

MBCook (132727) | more than 10 years ago | (#9839567)

It's not that the market is being eaten up, so much as the bar is being raised. iPods aren't going to have any trouble staying profitable. They hold tons of songs and have a great UI. The only MP3 players that should be worried are the small flash based ones. They are the ones that can be easily replaced with a cell phone. Same thing with cameras. You may see those $50 or $100 digital cameras in stores that people might buy for snapshots. Those things are going to disappear as cameraphones become more common. That said, cameraphones won't be replacing the 3+ megapixel cameras any time soon. True point and shoot cameras still have a market. If all you need is to store a few phone numbers and maybe a few addresses, then there is no problem with a cell-phone. But those people who use their PDAs for phone numbers, addresses, appointments, note taking, etc. will keep their PDAs.

It's not that the market is "shrinking", it's that the low end devices that aren't very good and only sold because of their price can be easily replaced. It will be at least a few years before people's cellphones replace their digital cameras on vacations or give up their iPod minis.

And note that no one is claiming that the GBA is going to die because of cell phones. They may have games and such, but the GBA is a whole other calibar. Well made devices have nothing to fear. The portable games that are going to suffer are the little Tiger handhelds and such.

Consumers, by and large, only stand to gain from this. Survival of the fittest garuntees that most of these devices will be around for a while, and the substandard stuff will fall off the market. Which consumers lose?

And to those of you that say "I just want a phone that's a phone, dang it", we're in the gadget phase right now. It's all new. Wow, I can get a cell phone that can do THAT? As novelty wares off and people see that the extra features aren't that great by and large, you'll start to see simpler phones. Just because I might be able to get phone/camera/MP3 player/PDA/etc for free with my contract doesn't mean I want the thing around. Bulk and interface often suffer. The "cell-phone-only" will come.

Phones are profitable (5, Interesting)

ljavelin (41345) | more than 10 years ago | (#9839569)

Of course cell phones are profitable - if they were not profitable, the cell phone manufacturers would create more profitable products.

And in fact, that's what they do.

Of course, for tax purposes, it is best if they show on the books that they lose money. As we've seen in many industries (manufacturing, healthcare, defense, MLB, etc) it's rather easy to show enough loss to avoid paying taxes. It is fact that corporations (at least in the USA) pay many fewer taxes as they did 5 years ago. The primary reason? Tax avoidance through "magic" accounting techniques.

If there was no money in the business, the shareholders would put a stop to it - after all, most cell phone manufacturers make many other products. But amazingly, looking at the past 5 years, share prices remain fairly stable compared to the overall tech sector.

Re:Phones are profitable (0)

Anonymous Coward | more than 10 years ago | (#9839812)

Wow, that post was such a joke! Quit being so sarcastic, dude.

I hate cell phones (2, Informative)

pHatidic (163975) | more than 10 years ago | (#9839576)

More and more of the small consumer gadgets are being folded into the phone: camera, music player, PDA, GPS, etc. So the market for non-phone gadgets is slowly going away as the phone picks up more functions.

Here's a simple solution. Build a camera with a cellphone in it. Build a music player with a cellphone in it. Build a PDA with a cellphone in it. Build a GPS with a cellphone in it. And quit your kvetching.

Seriously though, all of these cellphone toys are such crap. This is what I want. A cellphone that makes phone calls. And when it rings I want it to sound like a phone ringing, not Paris hilton getting fucked to german techno porn music. And I want it to be black and white. With no camera, games, or web browser. That has excellent reception and battery life, that does not accept text messages, that is easy to set to vibrate mode, that does not take 20 seconds to start up and shut down while playing an animated movie that is impossible to disable. Can someone please point me to this phone?

Re:I hate cell phones (2, Insightful)

PeterChenoweth (603694) | more than 10 years ago | (#9839674)

Have you actually, you know, shopped around at the cell phone providers? They all have free phones with one or two year contracts that are basic, no frills phones. Go to any major provider, Cingular, Verizon, T-Mobile, or SprintPCS. I know SprintPCS phones, check out the 3588i. Ok, so it *does* have a color screen, but that's about it. No camera, no games, no web, can't do text messaging, supposed to have excellent reception and decent battery life.

Every phone I've ever seen comes with standard beep-beep or ring-ring ringers. You would have to download and install the Paris Hilton fuck music yourself.

My last phone purchase: (1)

NeoSkandranon (515696) | more than 10 years ago | (#9839577)

Verizon saleslady: "That cameraphone is just $amount more than the one you selected"

Me: "No thanks, high end digicam for that."

Granted, I WOULD like a small portable digicam, but EVEN then im buying a small camera, becuase it will still be better quality than a cameraphone. That, I believe is the reason all-in-1 phones are so successful. Most people don't really, totally give two shits about whether it does anything WELL, so long as on the surface it seems as if their phone does alot of nifty stuff. Nevermind if it takes shitty pictures (which cost a mint to txt to someone) has a million crappy ringtones (which cost to download) and plays shitty games that have been around for decades on a pad thats ill-designed for gaming

OT: MISSING!!!! (-1, Offtopic)

Anonymous Coward | more than 10 years ago | (#9839583)

If you go to Google, and search for it's not there! Google has stopped indexing itself.

What about Early Adopters with higher end phones? (1)

xneubien (628441) | more than 10 years ago | (#9839594)

Hey..I paid full price($200each) for the pair of T616s that my fiancee and I use. Most of the higher end phones are really expensive. When are the phone companies going to start lowering the cost of the higher end phone?

selective addons (1)

nFriedly (628261) | more than 10 years ago | (#9839626)

i intentionaly got a phone with bluetooth, but not much else. at my school they have this fettish about stealing cellphones from students, however, they arent too worried about palm pilots. i can connect the pda to the phone through buletooth, and keep the phone safely hidden in my bag. (internet - not like i have anybody too call)

Universal Chip? (2, Interesting)

femto (459605) | more than 10 years ago | (#9839634)

I wonder if we will see the rise of a 'universal chip' that contains every consumer device known to mankind. It will be cheaper to manufacture billions of this all-in-one chip than to tool up to produce individual more specialised chips by the million.

The universal chip will be installed in every device then 'underclocked' so it only exposes the functionality that a consumer has paid for.

If it happens, it might make for some interesting hacks.

Re:Universal Chip? (2, Insightful)

FalconZero (607567) | more than 10 years ago | (#9839701)

You might be interested in FPGA's [] Which are practiaclly 'universal chips' you simply have a chunk of RAM (EEPROM) next to it that sets up the logic gates within the chip. They're only ~£15 ($20) per chip, and you can load whatever you want into them to perform any function. More info at [] (One of the industry leaders)

Not really an issue... (3, Insightful)

ryewell (793811) | more than 10 years ago | (#9839637)

The article states... "PDAs, cameras, GPS receivers, MP3 players, DVD players and game consoles" are all components of phones now...
HOWEVER, I would say very few people think to themselves "Hmmm... I'm want a camera, let's go buy a phone" or "Hmmm... I really love my gaming, I'll go buy a phone".
Perhaps the features of these new phones will affect a purchaser's decision, but in my opinion second rate features (i.e. low res camera, low everything game console, extremely bare bones MP3 player, non-optimized battery life, etc.) found in cell phones will never replace other non-phone sales unless the features are BETTER on the phone, which will never happen, because IT'S JUST A CEL PHONE!
Anyone who tells you "hey, I won't buy a camera, I'll just use my cell phone", was never seriously in the market for a camera to begin with, or is ignorant to quality and ergonomics. This would go for pretty much all of those features...

OMG! e-mail's gonna kill the postal industry!!!!! (5, Insightful)

potus98 (741836) | more than 10 years ago | (#9839639)

Remember that one? When everyone would use e-mail exclusively (since it was FREE!) and the post office, fedex, and ups would be out of business in 5 years. I don't have stats to back it up, but I suspect the Internet has actually helped the postal industry a ton. Okay, maybe people write and send fewer snail letters, but mail-order shopping and e-bay resulting shipments (more shipping $$$) have gone through the roof!

I can't predict how the gadget consolidation will play out, but I suspect there will be wonderful surprises in store down the road. Shouldn't all of these portable technical gadgets glob into one utility-pod anyways? Why should I be forced to fumble with seperate gadgets? What if they could get to a point where they build stackable phones with interchangeable camera modules, MP3 modules, holo-projection modules, etc... You could click 3-6 of these lego-like bricks togeather and have your own custom utility-pod that best suits YOUR needs.

Besides, once they get all the gadgets figured out and have nothing left to worry about, maybe they can finally provide unbroken signal coverage between my house and my office: A 15 mile commute in a frickin Atlanta suburb with a county population of 2.4 MILLION people. Incompetant bastards.

makes sense (1)

bark (582535) | more than 10 years ago | (#9839664)

This actually makes sense, as I don't really think the economy right now (north american at least) can bear the cost of supporting so many gadgets.

The market pays what it can bear ... for most mass consumers, they can pay for their phone bills, and not much more. Many of those gadgets are products looking for a market that doesn't exist. Ie advanced colour pda's ... etc ... aside from execs earning large bonuses, who is going to spend $600 + on such things?


w1r3sp33d (593084) | more than 10 years ago | (#9839677)

The hell with home service, voip, ip telephony, fsch the whole thing. Next time I need to build an enterpise class call center I will pitch a huge verizon wireless plan with a giant call forward loop for all the agents cell phones and conferencing feature for supervisors and be done with it.

too bad it'll never happen, back to work....

Maybe Gates was right... (3, Insightful)

Belsical (238668) | more than 10 years ago | (#9839695)

This, in my opinion, is a pretty good indication that Bill Gates could be right; hardware will be free [] . As software gets more complex and requires more devs, it's viewed more and more like a service. What we're seeing is an industry that's already gone the route of realizing that the material costs are miniscule compared to those of the labor/service, and thus include the hardware in the service package.

This could indeed come to pass . . (5, Insightful)

suckmysav (763172) | more than 10 years ago | (#9839710)

. . unless the phone manufacturers allow themselves to be shot in the proverbial foot by the major telcos by crippling the functionality of their devices with draconian DRM restrictions.

You better believe that ALL of the telcos are very keen to make you pay for every music file you load onto your phone, regardless of whether you already legally own the song on a CD or not.

You can see the marketing opportunities now, can't you? Just wait and you will see them advertising this "great new service" to their long suffering customer base.

"Dial 013013 followed by your selected song number from our extensive* catalog and your song will be delivered to your phone instantly!" (and billed to your phone account accordingly of course)

New phone? Well just dial 013013 again to re-order! It's that easy, and you'd better believe it baby!

From the perspective of your major Telco, there is no money in it for them when their customers can transfer mp3s from their PC's to their phones, and seeing that the phone manufacturers sell their phones to the Telco's (and not end users) the Telco's have significantly more control over the functionality (and therefore dysfunctionality) of phone devices than Microsoft will ever have in the PC world.

i dont have a cell yet... (1)

infonick (679715) | more than 10 years ago | (#9839738)

but when i do decide to get one, it will be just that, a phone. i dont want functions up the yang, especially ones that will probably need patching from script-kiddies. hell, i dont even want text messaging! gim'me a phone with nothing but unbelieveable reliability.

Not really... (2, Interesting)

wschalle (790478) | more than 10 years ago | (#9839747)

Does a photographer use his phone to take his pictures? Does a person replace their iPod with their phone? Not likely.

They aren't all free... (1)

MournsForHumans (801478) | more than 10 years ago | (#9839764)

When I was in Japan last Fall looking for a cell phone, I only managed to find a single plan that came with a free phone. Pretty much every plan required that a person either purchase a phone ($75-$250) or already have a compatible phone to use. They were remarkably nice phones, though, with very large, bright displays in extremely thin packages. While I don't have a phone in the US, I haven't seen anything like what I saw over there here.

Thanks for all the Adam Smith (3, Insightful)

Jahf (21968) | more than 10 years ago | (#9839769)

A basic lesson in economics. Call me jaded, but isn't convergence what everyone has been -hyping- for a few years? You'd have to be a bit thick to be in the phone or chip business and not seen this coming.

High-end cameras won't go away anymore than my Canon 35mm died when 110 film and later disposable cameras went away.

Non-phone audio players will continue, though maybe not so many portables.

PDAs? Ok, so I can see the phone and PDA market completely converging someday except for government spec'ed devices that can't have a phone.

Maybe some companies just got spoiled by being able to sell us a new latest-greatest-doodad every year or two?

Labelling (4, Interesting)

Paulrothrock (685079) | more than 10 years ago | (#9839776)

Cell phone companies should be forced to label their "phones" to help people make better decisions. They should show 1) Antenna gain, 2) Standby battery life and 3) Talk time on every phone, very clearly, just like mileage on cars. If cell phones are going to be important parts of our communication system, people should make decisions based on criteria that MATTER instead of mindless feature creep.

Phones are not making money? (4, Interesting)

weave (48069) | more than 10 years ago | (#9839785)

I bought a Nokia 6600 last month. I love the thing. Email (with tls/imap), calendar for appointments, contacts, all syncing just nice over bluetooth with my Powerbook. Bought Opera web browser for it, it rocks. Even loaded putty on it (although it's painful).

There's even one of those folding keyboards with bluetooth coming out that I'd love to buy next for it.

And if that's not enough, how about all the neat Symbian programs you can buy for it, like turning it into the ultimate universal remote control []

And the camera in it feeds my addiction to [] .

Anyhoo, sucker cost me $420. Someone made some coin on it.

I've owned a few PDAs including a Casio E100, E110, and a Dell Axim. Junk basically, and using imap or pop with pocket outlook is ultra painful. Too big and that resulted in me never carrying the thing. To get wireless internet access through the thing was another hassle.

This (nokia 6600 phone) puppy is just the right size for me.

Fred Pohl's Joymaker in "The Age of the Pussyfoot" (1)

renehollan (138013) | more than 10 years ago | (#9839801)

... one of two novels in the book "Bipohl".

In it there is a device that does everything for you (yes, even that) that's very much like the evolution of the modern cell phone. Interestingly, there's an underground society of poor people that can not afford to pay their Joymaker fees, and have to resort to that quaint alternative to electronic credit: cash, which is, of course, only used by such poor "untouchables", and thus accepted in only the grimiest of places. Without a working Joymaker, you literally can't communicate with anyone except face to face (and even then, it's a desensitized experience, execpt, perhaps, for "natural-flow girls"). Read the book. It's fun.

The second novel in "Bipohl", "Drunkard's Walk", is the better of the two, though, IMHO. Basically, people who solve a statistical riddle related to human populations get mysteriously driven to suicide. It turns out that the solution to the riddle involves accepting the premise that there are some people who do not die.

Load More Comments
Slashdot Login

Need an Account?

Forgot your password?