Monday, August 26, 2013

Google's got Balls

Google's got Balls

Google is set to launch the Nexus 7 LTE this September, and it looks to be the first device that a US consumer can buy without first deciding which provider to use.

A portable device enables consumers to immediately react to offers in the marketplace, which is a significant milestone for the US. It must have taken quite some cojones for Google to turn down provider subsidies and politics and make this move. It's what's next in US mobility.

Does it Matter?

The US wireless providers has over $300b yearly revenue, about $1,000 per citizen, so any little change is serious money. In the last few years, the DOJ has taken legal action, billions have been paid and jetset CEOs have been fired. Now, with the smoke cleared, everyone is on the LTE technology Verizon launched in 2010 and it's clear this is what the market will be for the rest of the decade.

Earlier in 2013, T-Mobile USA took the initiative to no longer tie in customer into 2-year agreements. It's the sign of the times: if there was a cross-provider device, a consumer could be switching providers every month instead of every 2 years. In numbers, that's 24 times different.

A cross-provider device will make the market evolve faster and determine if we will pay $30 or $190 per month for our service in the future. It's money, freedom and the American way.

State of the Nation

The US has been different from most of the world in that incompatible technologies, unique air-wave frequencies and a stale and political environment has prevented consumers from freely bring their device with them when switching providers.

A recent politically correct phone model exists in no less than seven different versions for the US, each largely useless when taken to another provider, if not electronically locked to its original provider altogether.

For comparison, provider-portable devices was introduced in Europe in the mid 1990s, and number portability, where you can keep your number when moving to a new provider, at the end of the last century. In the US, the FCC introduced wireless number portability about 10 years later.

Open Access

Google spent some time at the FCC frequency auctions back in 2007. Instead of spending billions, cojones did in fact accomplish something important for the US consumer: the FCC adopted Open Access rules for the frequency band where most of the LTE resides today. You want to host your Amazon site, BitTorrent the Bible or just hook up the neighborhood? Google lobbied to remove it from being a concern of your provider. Blocked ports, unavailable apps, and mysterious disconnects is history. This paves the way for easy voice calling over the LTE data channel.

This is do no evil version 2013. Google does us good, and the rest is ad revenue.

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