Carriers may bite back at Apple

Caroline Gabriel/Rethink Wireless
21 Nov 2011

Stanton, currently chairman of venture capital firm Trilogy Partners, told a conference in Seattle this week that Jobs had hoped to create his own Wi-Fi network to support Apple's mobile devices and services, rather than partnering with cellcos.

That would have suited the heavily controlled, end-to-end model which comes with the iPhone, but as Google also found with its first Nexus devices, the mobile carriers are not so easily ignored, with their massive customer reach and expensive networks.

Stanton said he spent a lot of time with Jobs in 2005 to 2007. “He wanted to replace carriers,” said the executive. “He and I spent a lot of time talking about whether synthetically you could create a carrier using Wi-Fi spectrum. That was part of his vision.”

But after that period, Jobs gave up the idea in favor of working with operators – but under Apple's own terms, and in a way which has certainly shifted the balance of power today. "If I were a carrier, I'd be concerned about the dramatic shift in power that occurred," Stanton added. Some analysts believe an Apple-run network is an idea the firm will revisit.

Stanton had his own advice for operators seeking to wrest back some of that power – take risks with new phones and services rather than playing it safe, as Sprint has done by signing an expensive iPhone deal at a later stage than its rivals.

Stanton recounted his own experiences as head of Voicestream (later T-Mobile USA), and as the first employee of the original US cellco, McCaw Cellular (which became AT&T Wireless). He also started Western Wireless, later acquired by Alltel, which is now part of Verizon. He said unique devices were important to cellcos, and that Voicestream took a gamble on the Danger Sidekick and the BlackBerry. "We had investments in those spaces because in part we were the little guy and we wanted access to unique devices," he said.

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