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AT&T Playing Hardball With Apple?

Zonk posted more than 6 years ago | from the trouble-in-the-boardroom dept.

The Almighty Buck 175

Ponca City, We Love You writes "There's some interesting speculation from Cringley on why AT&T chief executive Randall Stephenson let drop that a new version of Apple's iPhone will be introduced in 2008. The announcement is sure to cut into Apple's Christmas sales and could also cost ATT a million new customers and at least $1 billion in market cap, says Cringley. 'It is no coincidence that Stephenson made his remarks in Silicon Valley, rather than in San Antonio or New York,' says Cringley. 'He came to the turf of his 'partner' and delivered a message that will hurt Apple as much as AT&T, a message that says AT&T doesn't really need Apple despite the iPhone's success.' What may be troubling the relationship between AT&T and Apple is the upcoming auction for 700-MHz wireless spectrum and AT&T's discovery that Apple may be joining Google in bidding."

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first post (-1, Troll)

Anonymous Coward | more than 6 years ago | (#21542929)

chris matthews wuz here

God Smack Your Ass !! (-1, Troll)

Anonymous Coward | more than 6 years ago | (#21542933)

God Smack Your Ass !!

To AT&T

Pscht! (4, Informative)

goldaryn (834427) | more than 6 years ago | (#21542955)

a message that says AT&T doesn't really need Apple despite the iPhone's success

Pscht, yeah right... AT&T need Apple way more than Apple need AT&T. Apple's whole business model is built around early adopters, they have shedloads of goodwill from the whole iPhone rebates debacle, and this won't hurt their business one bit. AT&T are the ones who really stand to lose out.

Re:Pscht! (-1, Offtopic)

Anonymous Coward | more than 6 years ago | (#21542979)

Apple is an insect to a company like AT&T. IBM already blew off Apple because they were too small a customer to cater to, why wouldn't AT&T?

Funny you should mention IBM... (4, Insightful)

Junta (36770) | more than 6 years ago | (#21543559)

While not a perfect measure of a company, currently Apples market cap (159.5 Billion) is greater than IBM's (144.9 Billion). AT&T is currently at 231.7 Billion market, cap, so by that commonuly used measure, AT&T is still bigger.

I would wager that IBM didn't blow off Apple, but that IBM really couldn't deliver a performance competitive in a form with a TDP appropriate for laptops, with the final straw being Intel releasing Core2, for all intents and purposes erasing the instructions per clock advantage the PPC architecture had. (I know Apple made the jump before that, but I guarantee you that Intel shared the Core2 info with Apple).

Apple smartened up and realized that even when IBM made up for it, the simple fact was that Apple wasn't able to consistently differentiate themselves on hardware performance (and it really wasn't one of their goals now anyway), so they decided to play in the same market as their competitors, ensuring that they wouldn't appear to be left behind at any point in time. Extra bonus of Windows compatibility in the face of the market reality of desktop software. They chose to differentiate on brand, styling, and software (to an extent).

Re:Funny you should mention IBM... (4, Interesting)

Alan Partridge (516639) | more than 6 years ago | (#21543701)

"I would wager that IBM didn't blow off Apple, but that IBM really couldn't deliver a performance competitive in a form with a TDP appropriate for laptops, with the final straw being Intel releasing Core2, for all intents and purposes erasing the instructions per clock advantage the PPC architecture had. (I know Apple made the jump before that, but I guarantee you that Intel shared the Core2 info with Apple)."

Jobs stated as much when he announced the Intel switch. It was all about performance per watt and the roadmap - why IBM doesn't want to compete on PPW is a mystery - it's just as applicable to the datacentre as it is to the notebook.

Re:Funny you should mention IBM... (2, Interesting)

Heembo (916647) | more than 6 years ago | (#21543963)

I would wager that IBM didn't blow off Apple....
IBM found out early in its PowerPC market lifecycle that Apple was a PITA to deal with and was only a tiny fraction of the market for PowerPC. The real money for IBM was with embedded devices. Opps, thanks for your time helping us design this architecture, Apple. IBM is still selling pleeeeeety of processors and Apple shifting to Intel "ain't nuttin' but a thing." The real news here is that Steve Jobs is now in his office doin' a little Balmer-like screaming and chair-throwing now that they understand just how awful it is to do business with wireless carries. I hope to hell Google (and only Google) wins some of that spectrum (and leases a good chunk to Apple). F-U WIRELESS CARRIERS.

Re:Funny you should mention IBM... (1)

iamacat (583406) | more than 6 years ago | (#21544345)

IBM obviously has no long term vision in giving up Apple platform and selling notebook division to Lenovo. They are giving up the whole PC thing that they themselves helped to start and making it difficult for themselves to come back later as a non-trivial player. Mac platform, with users tolerant of unusual instruction set and slight lack of raw performance in exchange for unique features, could have been a good opportunity for them to take on Intel.

Re:Funny you should mention IBM... (3, Insightful)

Heembo (916647) | more than 6 years ago | (#21544423)

You are missing the whole point of WHY IBM is going this. It's getting really hard to make good money in the PC business. Take a look at Dell's problems, and although HP is doing well now, it's after a several years of pain. Apple, well, Apple is not longer a personal computer company and is deep in consumer devices. Take a look at IBM's 5 year stock chart and market cap http://finance.yahoo.com/q/bc?s=IBM&t=5y [yahoo.com] - dumping the PC business has not hurt their bottom line. Services, baby, has a lot less overhead that pc manufacturing.

Re:Funny you should mention IBM... (1)

ppc_digger (961188) | more than 6 years ago | (#21544325)

IIRC, IBM released a mobile PowerPC 970 about a month after Apple announced the Intel switch. IBM just wanted to get rid of Apple.

Apple + Google Market Cap = 376.3 Bills... (1, Interesting)

Anonymous Coward | more than 6 years ago | (#21544911)

So, here's the play: Apple and Google merge, then buy out AT&T...or Verizon, or whichever wireless provider you care to name...

Re:Pscht! (0)

Anonymous Coward | more than 6 years ago | (#21543033)

AT&T need Apple way more than Apple need AT&T ... AT&T are the ones who really stand to lose out.

Why do Brits refer to a business or organiz(s)ational entity as plural?

Re:Pscht! (0, Offtopic)

Dogtanian (588974) | more than 6 years ago | (#21543143)

Why do Brits refer to a business or organiz(s)ational entity as plural?
Why do Americans refer to a large group of people as singular? Because that's the way it is, and that's pretty much all there is to it.

It wouldn't surprise me if someone explicitly ran with your argument and used computer-programming-style "logic" to argue that organisations are a single entity/object and should be referred to as such. But one could also argue (equally if not more correctly) that organisations are seen *by humans* as groups of people and are referred to accordingly. (BTW, if someone tries to shoehorn the ubiquitous-but-dreaded "car" analogy into this discussion, I'll slap them silly :)

The simple answer is that spoken/written languages aren't that logical, and that alleged logic can be misapplied by geeks to argue for either side in cases like this... in other words, the ultimate answer to your question is "just because languages vary".

The word "group" is singular... (1)

Futurepower(R) (558542) | more than 6 years ago | (#21543161)

Quote: "Why do Americans refer to a large group of people as singular?"

Because the word "group" is singular, as is the word "company".

Re:Pscht! (1, Funny)

pipatron (966506) | more than 6 years ago | (#21543265)

It's just like a car, it's made of a group of smaller objects, so it should really be referred to as in plural.

Re:Pscht! (1)

Alan Partridge (516639) | more than 6 years ago | (#21543741)

A car isn't made up of a group of PEOPLE though, is it? Made BY a group of people, perhaps.

Re:Pscht! (0, Offtopic)

Madjeurtam (101190) | more than 6 years ago | (#21544449)

*** Whoooosh! ***

Re:Pscht! (4, Funny)

ClassMyAss (976281) | more than 6 years ago | (#21543435)

Why do Americans refer to a large group of people as singular?
Yeah, I don't understand why you would ever refer to a large group of people as singular, either. I guess some people are just dense.

Re:Pscht! (1, Offtopic)

Dogtanian (588974) | more than 6 years ago | (#21544589)

Yeah, I don't understand why you would ever refer to a large group of people as singular, either. I guess some people are just dense.
Bad phrasing on my part? Possibly. Though I suspect that it was more of an excuse for a joke than a genuine misunderstanding.

But let me take what you said to restate my point anyway. Consider someone addressing a class of students. Would we refer to what "it" thought or what "its response" was, or would we say things like "they thought" and "their response was"?

Yet, it's a class of students.

You could argue that in this case we're referring to the "students" in "a class of students", and that's why it's plural. But the same applies to "a large group of people".

Re:Pscht! (1)

hamelis (820185) | more than 6 years ago | (#21544775)

One possible explanation for the difference is in our perspective. Americans consider corporations to be distinct entities, independent of and removed from the people who make them up. In fact, corporations have all the rights of individuals (freedom of speech, etc), thanks to the 14th Amendment (yea, the one meant to free the slaves). There is a whole raft of other legal and cultural traditions that serve to separate the individual from the group for whom he or she works. Individuals working for a corporation (in the US) bear almost no responsibility, legal, moral, or otherwise, for their own actions as an employee, or the actions of the company as a whole. The responsibility is shifted to the corporate entity. This divorce could keep employees from identifying with their employer and employers from being considered groups of people.

It isn't the same everywhere, obviously. It's interesting how language can reveal underlying differences in perception.

Re:Pscht! (1, Insightful)

Anonymous Coward | more than 6 years ago | (#21543297)

I don't know. Why do Americans often say "could careless" when they mean "couldn't careless"?

Brits aren't the only ones. I think you'll find that many English speaking nations speak English as they do in England....

Re:Pscht! (1)

aussie_a (778472) | more than 6 years ago | (#21543317)

I don't know. Why do Americans often say "could careless" when they mean "couldn't careless"?
I don't know. Why are Brits so careless with their spelling?

Re:Pscht! (1)

Nossie (753694) | more than 6 years ago | (#21543351)

you tell us, you're the ones that bastardised it

Re:Pscht! (1)

SloJohn (894738) | more than 6 years ago | (#21543393)

The brits startred bastardizing german a long time ago. hence english languages today

Re:Pscht! (1)

Ragzouken (943900) | more than 6 years ago | (#21543621)

At least we aren't trying to pass it off as the same language!

Re:Pscht! (1)

leenks (906881) | more than 6 years ago | (#21543705)

Not really- American English has more in common with Old English than Modern English does. Words ended with -ize etc.

Re:Pscht! (0)

Anonymous Coward | more than 6 years ago | (#21543083)

AT&T need Apple way more than Apple need AT&T.

Hahahahahahahahahahaha! Dude, do you realize how huge AT&T is relative to Apple, and most other companies? As this little incident shows, Apple is virtually nothing compared to the wider interests of AT&T.

Remember, AT&T today is a relatively small shard of what it once was back in the 1960s and 1970s, before it was split. Yet AT&T makes most companies look like midgets, including Apple. To suggest that they need Apple, especially when all that's involved is a consumer handheld, is laughable. There are much more profitable avenues for them to really give a damn about.

Re:Pscht! (2, Informative)

signifying nothing (520593) | more than 6 years ago | (#21543277)

Hahahahahahahahahahaha! Dude, do you realize how huge AT&T is relative to Apple, and most other companies? As this little incident shows, Apple is virtually nothing compared to the wider interests of AT&T.

Current market caps: AT&T - $232bn, Apple - $160bn.
Yes, AT&T is bigger, but only by about 40%.

Re:Pscht! (2, Interesting)

bshellenberg (779684) | more than 6 years ago | (#21543097)

I'm quite certain that Apple needs AT&T far more than the other way around. Without the iPhone, AT&T still sells phones and does business. Without AT&T, Apple has no carrier.

Re:Pscht! (1)

Bert64 (520050) | more than 6 years ago | (#21543203)

AT&T is just one carrier of many... And remember the iphone is also on sale in europe with carriers other than at&t...
They could even just sell the phones in the same way every other manufacturer does - unlocked units, or cheaper units subsidised by contracts.

Re:Pscht! (1)

cioxx (456323) | more than 6 years ago | (#21543205)

Apple used AT&T as a launch pad to roll out the iPhone. The word it out and it isn't some conceptual technology anymore. Apple would benefit by cutting its ties with AT&T at this point and selling an unlocked phone. They'd lose the visual voicemail, but who cares.

At this point AT&T is dead weight for Apple, I am sure.

Re:Pscht! (1)

Orange Crush (934731) | more than 6 years ago | (#21544233)

The other carriers could implement visual voicemail too if they were able to carry the iphone. AT&T isn't exactly dead weight to Apple. An unlocked any-carrier iphone wouldn't get the kickbacks from monthly service subscriptions AT&T is presently giving Apple for the exclusive contract.

Re:Pscht! (1)

wealthychef (584778) | more than 6 years ago | (#21544331)

Isn't it more valuable for Apple to be enable their phones to work with Verizon OR AT&T and sell them to both customer bases than it is to get "kickbacks" from monthlly subscriptions? Plus, remember, to Apple, their branding is hugely important, and AT&T's suckiness in terms of technology is hurting apple. I know Apple would have much preferred to be with Verizon. I for one welcome the rift between Apple and AT&T, even as I worry that it means my current iPhone may become a doorstop in the next year.

Re:Pscht! (1)

aevans (933829) | more than 6 years ago | (#21544691)

Verizon doesn't even compare to AT&T. The biggest problem with AT&T's network is that they've got two incompatible 2.5G networks that they're trying to merge. Verizon still has nothing like what Cingular or AWS had before the merger. If they were leapfrogging, that might be an advantage, but they're not improving they're network, they're living off the fat of 75% the land lines they got for free. AT&T is trying to move into the modern world, and the only carrier that can compete (coincidentally using the same technology) is T-Mobile, but they're in no position to invest. Europeans have no idea about different spectrums, different technologies, different (competing) carries, or large are coverage, so they don't understand and are typically unable to comment on the situation over here. Most of them still trot out that hubs in Europe were offering SMS before the US in the 1990s, and consider that evidence of perpetual technological superiority.

Re:Pscht! (0)

Anonymous Coward | more than 6 years ago | (#21543431)

The AT&T data network is the worst one out there. Any of the other US carriers would kill to get the iPhone. Sprint would dump Palm in a heartbeat.

Put a stop to this one early... (5, Interesting)

shmlco (594907) | more than 6 years ago | (#21543201)

I think some industry types are overestimating just how much the public follows the off-hand comments of a CEO at a luncheon.

Besides, the fact that a 3G phone is coming isn't even a secret. If you wanted an iPhone for Christmas, you wanted one, and despite knowing full well that another one was coming next year. Heck, I bought one in June, knowing full well that Apple could easily introduce a newer version in November. I'd even figured out who'd get the old one if it happened.

Net effect on Apple? Zip. [isights.org]

And Cringely was right about one thing. Google announced that they were bidding today [google.com] . But the press release also made another thing quite clear: their application does not include any partners.

So. No partners means no Apple partnership, which means that there was nothing for AT&T's CEO to find out. Which in turn means that his comments were relatively innocent, and not "a $1 billion message to Apple CEO Steve Jobs." By my watch, it took less than ten hours for Cringely's consipracy theory to be shot down. Could be a new record.

Of course, you could spin it that Jobs, quaking in his boots at all of the iPhone sales he's already lost, called up Schmidt, pulled out of a planned multi-billion dollar deal, and Google obligingly issued the press release to cover his tracks. Yeah, right.

That's exactly how SJ would handle it.

Re:Put a stop to this one early... (3, Insightful)

gEvil (beta) (945888) | more than 6 years ago | (#21543441)

But the press release also made another thing quite clear: their application does not include any partners. So. No partners means no Apple partnership, which means that there was nothing for AT&T's CEO to find out.

You misread the summary. By "joining Google in bidding" the poster meant that Apple will also be bidding on the 700MHz spectrum--not that they will partner with Google in bidding for it. This isn't a partnership--it's the two going head-to-head for something they both want.

Re:Put a stop to this one early... (2)

shmlco (594907) | more than 6 years ago | (#21543639)

Actually, I've seen a bit of analysis recently that says that Google DOESN'T want to win the spectrum auction. Presumably, they're just in it so the bidding goes high enough to keep the "allow any software and any device" clause alive and kicking.

Besides the fact that Google's CEO Schmidt is on Apple's board, and that Apple and Google have a few things going on together, and bidding against Google would strain relations a bit, why would Apple go up against Google? Several things can happen:

1) Google bids, Google wins. Google allows any software and any device as per the rules. Apple can put an iPhone or iPad or whatever on it WITHOUT spending billions on spectrum or infrastructure.

2) Google bids up the price, someone else wins. Same net result for Apple. Wholesale access to 700 MHz, without spending billions.

3) Apple bids and loses to Google or someone else. Functionally the same end result as 1 and 2.

4) Apple bids, wins, and now has spends billions on spectrum and building out a nationwide service. And all just so they can now allow competitors to buy access at wholesale prices?

Sorry, not buying it.

Re:Put a stop to this one early... (1)

LetterRip (30937) | more than 6 years ago | (#21543975)

But the press release also made another thing quite clear: their application does not include any partners. So. No partners means no Apple partnership, which means that there was nothing for AT&T's CEO to find out.

You misread the summary. By "joining Google in bidding" the poster meant that Apple will also be bidding on the 700MHz spectrum--not that they will partner with Google in bidding for it. This isn't a partnership--it's the two going head-to-head for something they both want.

I'm not familiar with the FCC bidding rules - but it could also be a behind the scenes partnership that if Google wins, then Apple is going to guarantee a loan for Google or promises to purchase n amount of bandwidth from them, etc. Ie they can make it so that Google can go much higher much more comfortably than they otherwise might.

Re:Put a stop to this one early... (1)

BearRanger (945122) | more than 6 years ago | (#21544905)

Perhaps. But Apple doesn't need to bid. They "won" the minute Verizon said they would open their network to all devices--essentially the same thing Google intends to do should they win a chunk of the 700 MHz spectrum. Google has reasons to become a carrier. Apple really doesn't, especially if they have open access to networks for any device they may wish to build.

Re:Put a stop to this one early... (1)

SirMeliot (864836) | more than 6 years ago | (#21544019)

I think some industry types are overestimating just how much the public follows the off-hand comments of a CEO at a luncheon.

Type 'Gerald Ratner' into Google and see what you get.

Re:Pscht! (1)

Moralpanic (557841) | more than 6 years ago | (#21544011)

I would disagree. Apple's whole success in recent years is due to the iPod, and it's a no brainer that mp3 playing phones would replace iPods eventually. So Apple HAD to get into the cellphone market if they wanted to continue with the Ipod success.

Re:Pscht! (3, Insightful)

Divebus (860563) | more than 6 years ago | (#21544823)

...Chief executive Randall Stephenson let drop that a new version of Apple's iPhone will be introduced in 2008...

Doesn't Apple sue information leakers out of existence? Not that it takes an Einstein to guess that anyway.


Apple needing AT&T? Only for a few special iPhone features. If Apple opened the iPhone to any carrier and passed off that special feature set, AT&T would likely be everyone's last carrier choice so who needs who?

I doubt it will affect apple's sales. (4, Insightful)

eshefer (12336) | more than 6 years ago | (#21542967)

basically, the fact that apple will unveil a 3g iphone is (and was) obvious - with or without that att dude blabbing about it.

  the people who'd care about the existence of a higher network tech iphone have either bought an iphone already or they haven't and won't get a 2.5 iphone, anyway.

he also didn't say when next year. "next year" is a pretty long time frame.

Re:I doubt it will affect apple's sales. (2, Informative)

tgd (2822) | more than 6 years ago | (#21542983)

On top of that, although I haven't used ATT's 3G network, I did use my iPhone and a Verizon Voyager (3G) side by side a week and a half ago... and while individual downloads were perhaps slightly faster on the Voyager (but really not noticably), both the ATT 2G and Verizon 3G suffered mostly from horrible latency where actually starting to download anything was concerned. Once something was transfering there was a difference, but for web surfing I'd argue 3G really isn't all that necessary for the iPhone (or Voyager, for that matter).

If you could tether them, or I suppose if I was prone to sitting and watching youtube all day long it might matter.

Now... an iPhone I could tether over 802.11 or bluetooth without using ssh with dynamic proxies and other hacks like that... THAT would be nice to have with 3G.

Re:I doubt it will affect apple's sales. (1, Interesting)

Anonymous Coward | more than 6 years ago | (#21543323)

3G is more important for countries outside of the US where 3G is generally a lot faster and more widely available.

The iPhone maybe perfect for the US, the market it was obviously designed for, but outside of the US it doesn't look anywhere near as shiny.

Re:I doubt it will affect apple's sales. (1)

TubeSteak (669689) | more than 6 years ago | (#21543249)

AT&T is getting the LG CU920 aka the Prada phone next year.
It runs Windows Mobile 6.0 & it is a touchscreen like the iPhone.
And it comes with 3G.

Why AT&T would do this... make of it what you will.

Predicted for weeks? (0)

Anonymous Coward | more than 6 years ago | (#21542975)

In the article, Cringely claims he has predicted for weeks that Apple may bid for spectrum.

Ok, did he predict it before business week did? http://www.businessweek.com/technology/content/sep2007/tc20070910_014733.htm [businessweek.com]

Nice of him to try to come off as a genius when basically he lifts other people's predictions or states the obvious and then acts like he's nostradamus.

He's ANNOYING.

Echo (5, Funny)

12WTF$ (979066) | more than 6 years ago | (#21543023)

"Hello? AT&T Customer Service?"
"Good Morning, How may I assist you?"
"I hear this echo..."
"An echo? Do you mean on your AT&T phone?"
"No. It's your CEO. He is just repeating what Steve Jobs said a few months ago"

"You can expect a 3G iPhone later next year... We are working on the next iPhone already, the one after that and the one after that."
Regent Street Apple store in London, September, 2007

EVERYONE READ THE ABOVE COMMENT (5, Interesting)

porcupine8 (816071) | more than 6 years ago | (#21544127)

This one quote makes the entire thing a non-story, and it's obvious that many of the commenters below haven't read it. And yes, it's a real quote - google any section of it and you'll pull up a dozen stories on it from mid-September. The AT&T CEO can't leak something that Jobs already said in public, which means we can stop theorizing about the motivations behind or repercussions of such a leak.

"Sometime next year"? No $hit, Sherlock (4, Insightful)

sirwired (27582) | more than 6 years ago | (#21543057)

It should not come as a surprise to anybody (except perhaps the logic-impaired Cringely) that perhaps Apple might feel the need to release a product update in a rapidly evolving market sometime before the sucker is completely obsolete. The fact that 3G capability is a glaring hole in the current model is not exactly front-page news. Also, "sometime next year" could mean a span as long as 17 months, an eternity in the cell phone market. I would expect that it will receive a flash capacity bump at the same time (at least a doubling).

Also, where does the $1 Billion number come from? The same dark, damp, place that produced the "fact" that IBM was going to lay off half of its worldwide workforce?

Cringely: Wild Speculation for folks too dumb for Dvorak.

SirWired

Re:"Sometime next year"? No $hit, Sherlock (1)

marcello_dl (667940) | more than 6 years ago | (#21543173)

Of course i didn't RTFA, but maybe the columnist is referring to the way apple reacted to similar announcements in the past (they were so pissed off they terminated deals IIRC).

Re:"Sometime next year"? No $hit, Sherlock (1)

scarper86 (954053) | more than 6 years ago | (#21543347)

I don't understand this either. Steve Jobs himself already announced that there would be a 3G iPhone released in 2008. I'm pretty sure it was at the UK iPhone launch. So all of this "playing hardball" crap is uninformed rumor-mongering disguised as shoddy journalism.

Re:"Sometime next year"? No $hit, Sherlock (0)

Anonymous Coward | more than 6 years ago | (#21544189)

Also, "sometime next year" could mean a span as long as 17 months


Or, maybe 13 months?

Re:"Sometime next year"? No $hit, Sherlock (1, Funny)

Anonymous Coward | more than 6 years ago | (#21544739)

Or, maybe 13 months?

Sorry. I started on that post back in August.
I'm a slow typist.

Ah Robert Cringley (4, Informative)

hansoloaf (668609) | more than 6 years ago | (#21543063)

That should set off alarm bells in your head. A lot of his columns lately have been filled with nothing but pure speculation based on nothing but gut feeling or reading tea leaves.
I tend to ignore his columns when he goes off like that. If he talks about upcoming technology then I'll read it.

Re:Ah Robert Cringley (1)

irtza (893217) | more than 6 years ago | (#21543189)

if he talks about upcoming technology then I'll read it.


Um... this is talking about upcoming technology - sort of. Why bother reading anything he writes? And isn't the point of sites such as digg and slashdot to sort of pick and choose articles from across different sites that would be worth reading. it seems the worth in the previous sentence is where I made my mistake.

well, lukcily I'm one of the masses that doesn't RTFA. life is good.

Lately??? (1)

dreamchaser (49529) | more than 6 years ago | (#21543889)

Cringley has *always* been about rampant speculation, and he's usually wrong.

scheduling the end game with unprecedented evile (-1)

Anonymous Coward | more than 6 years ago | (#21543067)

the lights are coming up all over now. there is little choice left. it is/will be as it was meant to be.

the 'odds', as always, favor the creators, using an unlimited supply of newclear power. we cannot help but feel that they would be more enthusiastic about rescuing/freeing us/yOUR planet if they had some/more help from you, as opposed to watching us continue to be willing hostages of evile's greed/fear/ego based life0cidal corepirate nazi minions/execrable.

so, get a bit more oxygen on yOUR brain tissue. take the chance of making eye contact with the folks you pass by during the day. look up at the sky from time to time, starting early in the morning. 'vote' with what's left in yOUR wallet. get ready to witness the big flash. everything will be different then. better days ahead. see you there? the alternative (for those who think there is one) is not acceptable.

Cringley (3, Insightful)

clarkkent09 (1104833) | more than 6 years ago | (#21543079)

Speculation is one way to put it, crazy conspiracy theory is another.

So AT&T CEO decides to drop 1 million customers and 1 billion in market cap (!?) in order to send a message to Apple not to bid on the wireless spectrum auction, that's his theory? If I was an AT&T shareholder I'd be wondering why not just phone them instead...

Is this the same guy who predicted Apple and Intel merging

Re:Cringley (2, Interesting)

hey! (33014) | more than 6 years ago | (#21543729)

Why would they drop a million customers?

Basically, they've got a contract with Apple; unless letting the cat out of the bag this way invalidates that contract, they continue to have their exclusive for the duration of that contract.

AT&T's interest in this deal is to rope in more subscribers. The people who wait a few months for the new iPhone are going to be signing up with AT&T. Granted they leave a few months of subscription fees on the table, but if they suspect Apple is going to knife them in the back, they'll make it up on the back end.

Who could Apple knife AT&T in the back? Possibly by creating a platform for wireless applications that was not a phone under the terms of their contract. A wireless platform plus a third party VoIP app would be as good as phone for many people.

Re:Cringley (1)

0100010001010011 (652467) | more than 6 years ago | (#21544809)

They have a contract with Apple for the 'iPhone'. Jobs is known for his unpredictable behavior after other companies do this to him. He had ALL ATI graphics cards pulled from MacWorld because of a slip like this.

I agree with you. What if it's not called the 'iPhone'? What if Apple spins off a wholly owned subsidiary (Like Claris) and sells an iPhone through that route? I'm sure Jobs has some tricky little out built into the contract.

"Ok. You wanted 5 years exclusive for the iPhone? Ok, we're never making a product update again." So at the end of 5 years the iPhone is still selling identical to how we see it today and Apple's pushing the aPhone on the Verizon/Google network.

I'm confused (4, Insightful)

Mistshadow2k4 (748958) | more than 6 years ago | (#21543091)

I know AT&T is a much larger, more powerful company than Apple, but exactly how can they play hardball with Apple on this issue? If Apple drops them, signs with another carrier -- or even none -- for their next iPhone, it would be AT&T that loses money, not Apple. Apple has already made a nice bundle with the iPhone, so they probably don't really need AT&T anymore and as popular as the iPhone is, AT&T can be replaced. Does AT&T think that the primary reason people want the iPhone is because of AT&T? Obviously that is not the case, since so many people are unlocking them as soon as they get them. Seems like it would be the other way around, with Apple in a good position to play hardball with AT&T. Maybe I need more coffee, because I just don't see it.

Re:I'm confused (1)

TubeSteak (669689) | more than 6 years ago | (#21543267)

If Apple drops them, signs with another carrier -- or even none -- for their next iPhone, it would be AT&T that loses money, not Apple. Apple has already made a nice bundle with the iPhone, so they probably don't really need AT&T anymore and as popular as the iPhone is, AT&T can be replaced.
Visual Voicemail, AT&T has it.

You seem to be forgetting the whole reason that Apple had to make an exclusive deal on the iPhone. Whoever got the exclusive had to upgrade their backend to handle visual voicemail. Not everyone was interested in doing so (at the right price for Apple, I assume).

Re:I'm confused (2, Insightful)

Mistshadow2k4 (748958) | more than 6 years ago | (#21543367)

I still don't get why this is a problem for Apple. Other telecoms would be quick to swoop in if Apple dropped AT&T. This would only be a problem if the iPhone were a regular, everyday cellphone, which it isn't.

Re:I'm confused (0)

Anonymous Coward | more than 6 years ago | (#21544729)

I don't see why that should be too difficult. This "visual voicemail" thing the iPhone should work exactly like e-mail, insofar that voicemails are converted to mp3 or similar, attached to an e-mail and are "read" (heard) through a client that understands what to do with these messages, and is easy to use. I mean, neglecting the last part, that is exactly what any asterisk PBX can do, simply by turning ONE option on in voicemail.conf

I have a hard time imagining that the giants in the telecom, who pay millions of dollars to develop or buy soft/hardware would have something so rigidly inflexible as to not be relatively easy to implement something like this. Plus, face it: this is the way things are going to go.

It's telecoms vs. manufacturers (4, Insightful)

Iloinen Lohikrme (880747) | more than 6 years ago | (#21543287)

This is all about telecoms versus mobile phone manufacturers, also known as business as usual. If a telecom thinks that is business is more than just offering connection, as in being a carrier, and as more being an service provider or an experience, then the number one competitors are the handsets manufacturers as they are the ones beside operator to influence and have place in customers hand.

Just to give some examples... Nokia has worldwide market share of approximately 40%, but in US its market share is only 5%. Why is it? Well it could be because they don't manufacture CDMA based handsets anymore (direct attack against Qualcomm), but mainly because in US handset business in operator business where operators offer to consumers what they think suites best for operators not for the consumers. To operators it suites that handsets are limited or walled, and to operators it suites better that the brand power of an handset is less than the branding power of operator. This has meant that operators don't want to offer Nokias handsets as to them Nokia is too powerful player in branding and service base, and so offering Nokias handsets more would hurt their position in longer time-frame.

What basically AT&T is doing to Apple is just business as usual. Kick them where it hurts. Weaken their position and try to make a better deal with them. Also it should be noted that market situation has changed as major handset manufacturers and also lesser known Asian manufacturers are all offering and bringing iPhone clones to markets. For AT&T it could be lucrative to just get some iPhone clones from far east with bargain price and brand them by themselves.

Of course there is remote possibility that mobile operators in US are colluding against Apple. There are only few GSM based operators in US, and I could easily imagine them speaking with each other to maintain status-quo in the market. So in example AT&T kicks Apple first, then as Apple talks to T-Mobile or other player, they just throw their hands up and say "oh, but we are not interested at that price", and voila telecoms win.

Re:It's telecoms vs. manufacturers (1)

LWATCDR (28044) | more than 6 years ago | (#21543595)

"To operators it suites that handsets are limited or walled, and to operators it suites better that the brand power of an handset is less than the branding power of operator."
One of the reasons I stay with Sprint is that they don't wall their phones. And as far as brand power. Well I think the Razor is a good example of how a make or model can be a big deal even in the US. I keep hoping that Apple will drop AT&T and go with Sprint.

Re:It's telecoms vs. manufacturers (1)

maxume (22995) | more than 6 years ago | (#21543815)

How is not manufacturing CDMA phones an attack on Qualcomm? CMDA is entrenched at the network level in the US(and elsewhere, wow, neat). Qualcomm gets revenue from sales of handsets for those networks. By not supporting CDMA, Nokia doesn't. How terrible for Qualcomm that Nokia isn't getting any of that revenue.

If Nokia phones were 2 times better than anything else on the market, I could see that you might have an argument. Is this the case?

Re:It's telecoms vs. manufacturers (1)

Iloinen Lohikrme (880747) | more than 6 years ago | (#21543957)

It's all about patents. All the mobile phone companies have lots of patents and they share them. Qualcomm has very much patents concerning CDMA, and if Nokia wants to make CDMA handsets they have to pay royalties to Qualcomm. By not making handsets to CDMA, Nokia can cut Qualcomms revenue stream and they make CDMA less likable: lesser handsets you can offer to consumers mean lesser reasons for them to take your service. As Nokia has much better position in patents in GSM & WCDMA standards, it's for Nokia beneficial that CDMA is used less and less.

Also one reason for Nokia leaving the CDMA market all together was that Qualcomm was subsidizing their chipset business via royalties, so that put competing chipset manufacturers like Texas Instruments in an unfavorite position.

And to question about Nokias handsets, they might not be double the better than competitors, but they are better and there is more to choose from. You might want to take a look at Nokias web site, just don't choose US as your location, but choose Europe and use the general European site, there you will find quite a big collection of phones that you have never seen before.

Re:It's telecoms vs. manufacturers (1)

maxume (22995) | more than 6 years ago | (#21544203)

My point was more that if Nokia is giving up profitable revenues with some notion of spiting Qualcomm, they are really only spiting themselves, as the portion of people who are selecting their provider based on the availability of Nokia handsets is not going to be all that large(viz. Sprint and Verizon are the two largest carriers in the US, both use CDMA, none of their customers cared most about getting a Nokia handset). If they weren't making much money on selling CDMA handsets, well, they made a business decision.

Re:It's telecoms vs. manufacturers (1)

Iloinen Lohikrme (880747) | more than 6 years ago | (#21544953)

The playing field is global. Qualcomm has offered its CDMA and EV-DO around the world. CDMA and EV-DO are competitors to GSM and WCDMA. If Qualcomm can get CDMA and EV-DO adoption rate higher, that threatens Nokia as they are mostly based on GSM and their patent portfolio concentrates on this area. So by trying to undermine CDMA and EV-DO by alls means possible, including abandoning CDMA handset sales, Nokia can make CDMA less attractive in both local, like US markets, but also globally. That's the point.

Also if you have looked on news, Nokia and Qualcomm are now currently at patent war with each other. They both are trying to get each other, and in case of Nokia, they really wouldn't mind nailing Qualcomm from telecom business once and for all.

This kind of hardball will be ending soon... (4, Insightful)

ElBeano (570883) | more than 6 years ago | (#21543109)

The industry is going to go through some wrenching changes because new players are going to be more willing to open their networks (for real, not pretending to like Verizon). What new players? Clearwire and Google, or a combination thereof.

This will make it easier for phone/device manufacturers to provide genuinely innovative products. If AT&T wants to stick it to Apple, they're going to find their bargaining position weakening. Quickly, I hope.

What "success" (2, Insightful)

nagora (177841) | more than 6 years ago | (#21543111)

The iPhone's sitting on shelves in the UK at least; retailers can't get rid of them and sales have been something like 1/3rd of Apple's projections. Is that "success" nowadays?

TWW

Re:What "success" (1)

Terri416 (131871) | more than 6 years ago | (#21543207)

Would you buy a $400 iPhone for $551? Really?
We aren't the gullible sheeple that Steve thinks we are.
Besides, it's only G2.5. That's /so/ 2002.

Re:What "success" (1)

Bert64 (520050) | more than 6 years ago | (#21543213)

The UK iphone plans are quite expensive compared to comparable plans even from the same operator... The average consumer doesnt understand the concept of unlocking.

Re:What "success" (3, Insightful)

mccalli (323026) | more than 6 years ago | (#21543385)

The average consumer doesnt understand the concept of unlocking.

Don't you believe it. The average consumer here in the UK certainly does understand the concept of unlocking, normally done down a local market for about £5. What they don't understand the concept of is paying £270 for a phone - phones here are things that come free with your contract, paying even £50 would be considered unusual. There are exceptions, such as the N95, but that's at the very top end of the market only and is still considered to be unusual.

Cheers,
Ian

Re:What "success" (0)

Anonymous Coward | more than 6 years ago | (#21543859)

Virtually every operator in the US will give you a free phone when you sign a contract with them. These are pretty basic phones, but most people use them as they are good enough for their needs. Some still opt to purchase better phones because they want the extra capabilities of the more expensive phones. I would bet that the same is true in the UK, and that paying for the phone is hardly as unprecedented as some people are making it out to be.

Re:What "success" (0)

Anonymous Coward | more than 6 years ago | (#21544125)

I don't know about the UK, but I wouldn't call the phones you get with a contract here in continental europe basic.
For instance you can get an unlocked Sony-Ericson w880i for about 280 unlocked or you get it for free with a contract.
High end phones like the Nokia N95 with 8Gb memory are about 680 unlocked or for 200 with a contract.
When you are in a contract you often get points each month depending on your monthly fee and how much extra minutes you use and you can then use those points to get a new phone cheaper.

Re:What "success" (1)

Yer Mum (570034) | more than 6 years ago | (#21544439)

You can even get a N95 for free (Vodafone, on an 18 month contract) with a monthly subscription fee comparable to O2's monthly subscription, however without the initial £269 for the phone.

Really, Apple's pricing model doesn't work in the UK or most of continental Europe. Why tie yourself to a network, an 18 month contract, and an expensive tariff if you can buy an iPod Touch for the same price and stay with your current network, contract, and cheaper tariff.

Re:What "success" (0)

Anonymous Coward | more than 6 years ago | (#21544749)

Wrong... I picked up a Nokia E61 when they were brand new back in Q2 2006 for free. Roughly 6 months ago, my housemate picked up a new Nokia N95 for free. The UK's model is very different than the US. As an American in the UK, it took quite some time to understand it but it makes a lot of sense why the iphone has failed so far in Europe/UK. If I want an iPod, then I'll get one. If I want a loaded 3G phone that does VoIP, music, email, web-browsing and everything else for free then I'll get everything else.

Re:What "success" (1)

Alan Partridge (516639) | more than 6 years ago | (#21543841)

The plan isn't too expensive, neither is the upfront price - it's the COMBINATION that's too much for the UK. I'd gladly pay £400 upfront for an unlocked iPhone OR take one for free/£50 on the O2 plan - but I won't pay twice.

I want an iPhone, I'm just waiting for the pricing to adjust to our market. If it never does, I'll never get one.

Re:What "success" (0)

Anonymous Coward | more than 6 years ago | (#21543399)

That's not the only reason. Apple doesn't design products for the world outside of America. It designs for the US and then adapts.

Look at the country list on the Apple Store site. 3 US sites are list before the rest of the world in alphabetized order. That should tell you something.

Look at the currency list for the Mac dashboard converter widget. The US dollar is only currency not in alphabetized order, it's listed before all the other currencies. Think that's because the green back is the most important currency? Well then, why not put in order with the others but make it the default currency? Apple consider the world outside of the US a second thought which is why the iPhone was designed for the US market.

ATandT v.s. Apple (0)

Anonymous Coward | more than 6 years ago | (#21543131)

It's amusing to see the unix buddies fighting!

Well, then I hope it backfires... (0, Redundant)

FauxReal (653820) | more than 6 years ago | (#21543183)

and leads to Apple & Google creating a quality & service oriented network open to any device willing to pay for access.

Re:Well, then I hope it backfires... (2, Insightful)

AHumbleOpinion (546848) | more than 6 years ago | (#21544567)

... leads to Apple & Google creating a quality & service oriented network ...

"join in bidding" means they will be bidding against each other, competing.

what Apple should do is (1)

FudRucker (866063) | more than 6 years ago | (#21543259)

make the iPhone more open to accept any service including Tracfone...

Steve Jobs has a history of abusive partnerships. (0, Flamebait)

Futurepower(R) (558542) | more than 6 years ago | (#21543291)

Steve Jobs has a history of choosing abusive partners, even though he knows very clearly they are abusive. First, sugar water salesman John Sculley, and now SBC, which bought the AT&T name apparently because the name SBC had such a terrible but deserved reputation.

(Anyone interested in how SBC became AT&T can watch Stephen Colbert explain in a 1 minute 14 second video: The New AT&T [google.com] .)

Steve Jobs certainly knew SBC/AT&T is abusive; it was a telephone company then centered in his home state of California. He clearly knew John Sculley was abusive [wikipedia.org] , he called John Sculley a sugar-water salesman before he was hired.

Remember, John Sculley arranged that Steve Jobs be fired from Apple. Then, over a period of years, John Sculley almost destroyed Apple. Eventually, Sculley was fired, Steve Jobs was hired again, and Apple became strong again.

The evidence is that Steve Jobs is an extremely intelligent person with a huge anger problem. He has a reputation for being abusive himself. Having abusive partners seems to be another expression of anger, an attempt to hide his anger from himself.

Re:Steve Jobs has a history of abusive partnership (0)

Anonymous Coward | more than 6 years ago | (#21543649)

You left out the part where running a 'sugar-water' company defines you as being abusive.

Please list the CEO's of Pepsi and Cocoa Cola since the formation of those companies and rate each one's 'abusiveness' on a scale from 1 to 10.

For extra credit, include the CEO's of RC and Shasta.

Bad enough having a new version.... (1)

gilesjuk (604902) | more than 6 years ago | (#21543321)

But the thing that hurts the most is that the new version comes out before your 18 month contract expires meaning you have to have two contracts or just miss out on the improved version.

This is why I don't bother with contracts, your contract phone is tarnished and practically worthless by the time you are at the end of the contract.

It would be like having 20 year finance on a car.

NDA? (1)

nurb432 (527695) | more than 6 years ago | (#21543407)

I wonder if apple stuck on some sort of NDA about new products and this dude leaked it without permission.

Either way, id be pissed if i was Steve Jobs.

Cringely's like a home run hitter (4, Informative)

jht (5006) | more than 6 years ago | (#21543527)

When he hits one, he really nails it, but when he misses it's by a lot. I posted some of this as a comment on his site, so I apologize for the duping, but:

Steve already stated that there would be a 3G iPhone, and he said to expect it late next year. Quoted at the London Apple Store opening back in September. That's not the only time Apple's discussed it.

EDGE is ubiquitous on the AT&T network. If you want data access, EDGE support is a no-brainer.

With the minor upgrades to EDGE that AT&T did over the spring and summer, the iPhone is improved, and so are the other EDGE devices (like the Treo 680, for instance) that they sell. It's a good investment by AT&T.

Right now, most of the 3G chipsets are still relatively bulky and draw fairly high-power - by 2008 that should change. But the current iPhone has really good battery life - adding 3G to that today would hurt. Apple's also stated this directly.

3G support isn't built out yet on much of the AT&T network. It's still only in the major metro areas. Kind of where EVDO was about 3 years ago. Not to mention that their 4G plans are in sync with Verizon's now.

Seriously, these aren't the toughest tea leaves to read. By the time AT&T builds out their network for 3G, Apple will be ready to use it. If Apple's contract gives them an opening to play in 700, they'll do that as well. But I count this as a Cringe miss - there's no conspiracy this time, just a lot of obvious and previously stated facts.

Re:Cringely's like a home run hitter (1)

MikeyVB (787338) | more than 6 years ago | (#21544193)

Right now, most of the 3G chipsets are still relatively bulky and draw fairly high-power - by 2008 that should change. But the current iPhone has really good battery life - adding 3G to that today would hurt. Apple's also stated this directly.
This already has recently changed. Broadcom just developed a new compact chip that supports all the major 3G technologies plus other things (Bluetooth, FM Radio). I forget where I heard this from, but a quick Google has a reference here [news.com] . IMHO, the "we cant do 3G because of battery issues" is just an excuse to stall wait for the 3G market in the US to develop a bit more first.

Re:Cringely's like a home run hitter (1)

jht (5006) | more than 6 years ago | (#21544617)

The newer generation chipsets have just started to hit the market in the last few months. It takes a while to engineer them into handsets - I think you'll start seeing them in volume devices during Q1 08. Apple never said iPhone was the one and only. It's the first handset in what will be a family of devices. It may even be that the iPhone that we know now stays on the market at a lower price point while the 3G iPhone comes out and sells for more money. Or maybe AT&T charges an extra $5 for the 3G data plan. It'll take a while to shake out.

Ultimately what all the companies involved have in common is that they want to earn boatloads of cash.

Pretty soft hardball (1)

tgibbs (83782) | more than 6 years ago | (#21543655)

Apple's stock did not take a hit from the announcement, so the market clearly does not think that this is going to have a big impact on profits (in contrast, it fell quite sharply when Jobs announced the iPhone price cut).

It seems more like a difference in corporate strategy between Apple and AT&T rather than an attempt to hurt Apple. Apple traditionally likes to keep things secret until they spring it on the public. But many other companies like to let investors know where they are headed. And it's not exactly a surprise to anybody that there will be a 3G model, probably in the next year or so. The main issue is fitting it into the case while retaining battery life.

I think that the impact on sales is likely to be minor. "Next year" likely means a year from now, and many people replace their phones every year or two.

real obsolescence (1)

TheSHAD0W (258774) | more than 6 years ago | (#21543677)

So... Let's say I went and picked up a bargain 1st generation iPhone once the 3G version emerged. I don't mind slower speeds, so long as I get service. Will EDGE be going away? Will I still have that service?

Hero$ (2, Funny)

GodInHell (258915) | more than 6 years ago | (#21543769)

Free the spectrum. . . Save the world. . . Make $$$

-GiH

suicide bomber as business strategy (1)

nobody/incognito (63469) | more than 6 years ago | (#21543925)

this is why i am a t-mobile customer

echo of Steve, but if Apple wanted to get revenge (0)

Anonymous Coward | more than 6 years ago | (#21544605)

This is a bit silly since Steve said they would move to 3G very soon in the initial iPhone announcement. But if it were some attempt to hurt Apple, there is a very easy way for Apple to exact revenge. Since they are now shipping and supporting unlocked phones (in europe), they could simply announce that from now on updates to iPhone would work with unlocked phones no matter where they are unlocked (hint hint that includes jailbreak phones). Sales would take a jump and AT&T wouldn't see a penny of those.

Steve Jobs (2, Funny)

bluefoxlucid (723572) | more than 6 years ago | (#21544951)

And Jobs says, "Okay, FUCK AT&T. Pull their contract on grounds of assassination of our business model; sue them for our projected lost business; and start shipping iPhones for Verizon only. Let's see how they like their new potential customers flocking straight to the competition." Then AT&T's stock price drops.
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