That's right, Verizon, which only got to sell the iPhone earlier this year, is siding against Apple. And that should scare Apple, and the other mobile patent warriors. No software or hardware vendor in the space can be successful out of a larger context. Make enough waves, and some are bound to come sailing back to smack you.
Apple doesn't rule the business
Given the popularity of the iPhone, you might at first think that it would be insane for a carrier to oppose Apple. But that's actually not the case. AT&T (T) did attract and retain a lot of business by having an exclusive on the product. And yet, Verizon managed to remain huge selling Android. (Samsung claims that it has sold 10 million Galaxy S II phones alone.)
In other words, there's much more to success in wireless than selling a particular phone. As much as it astounds the fanboys, there are people who don't like Apple and the iPhone. Just as there are people who hate Android and Google. Who knows? We may eventually find that there are people who are happy to buy a handset running Microsoft (MSFT) Windows Phone.
Verizon wanted the iPhone for strategic considerations. Having it helped retain whatever percentage of their customers might have switched to AT&T to get the product. Most of the ones who would have probably already did. And offering the iPhone lowered a barrier for consumers who insisted on having it but who didn't like AT&T's service.
Why did Apple make the iPhone available to Verizon? Because the only other choice was to cede all those tens of millions of consumers to the Google clan. And Apple wants to keep a hefty pace of growth. It can't do that restricting itself to the same resellers and their customers. Continued international growth is vital, but much of the low-hanging fruit is gone. That's a big reason why the AT&T exclusive, which effectively cut Apple off from much of the U.S. market, had to go out the window.
Can you hear them now?
Apple is in a world where it cannot completely set the agenda, no matter how much control it exerts over the operating system, hardware, and delivery of music, video, publications, and software. That's because the ecosystem still isn't complete. It sits on networks that others own.
It's an old business problem, even in high tech. Software companies depend on the operating system vendor, which, in turn, must find ways to cooperate with the hardware manufacturers. They all have to work with the retailers, who can effectively limit their access to markets.
Even with its own highly successful retail chain to get to customers, Apple lacks any wireless capacity. Could the company obtain it? Certainly. It could have bought T-Mobile for the price AT&T offered for cash and still had more money on hand than most companies will ever see. But it hasn't.
Up to a point, the carriers can tolerate the patent wars among vendors. But eventually the fighting threatens their revenue. That's when the gloves start to come off. It's why Verizon filed the brief, because it owns 55 percent of Verizon Wireless. The other owner is Vodaphone, an important international wireless carrier.
Carriers are starting to send a strong message to Apple -- the type of communication usually done privately. Chances are, they have already directly expressed their concerns. This is the next step.
Apple is usually a smart company, and would be wise to consider amicable cross-licensing arrangements. Let consumers decide what they like most. But if corporate ego takes over, the company might continue to push. Eventually, it will hit a wall.
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