Consumers sparking a quiet revolution against US mobile carrier lockdowns

Today's Boston Globe has an article about how many cell phone users are discovering services that unlock their phones from their carriers and otherwise enabling services that compete with those the carrier themselves provide. While those services in the past were just the province of the geeky among us (I include myself among that group), they now are mainstream enough for the local mall. This isn't a technology change; it's a market change:

"Whereas a carrier might wish for a phone that does nothing more than what they want it to do . . . the world has moved past that simple model of all things emanating from a central switch, and the broader world is in favor of putting more and more control of that technology in your pocket," said Andy Lippman, director of the Digital Life Program at the MIT Media Lab, which is working on ways for mobile devices to communicate with one another without going through the carriers' cell networks.

The article continues, noting that carriers have traditionally slowed the introduction of new services that bypass their networks by restricting the hardware the consumer can buy.

...Operators have been slow to put Wi Fi on cellphones out of fear that people would use programs that allow them to make calls over the Internet and avoid paying cellular fees, the iSuppli report stated.

"They're trying to control the platform, and they can tie various business plans or business revenue streams to it," said Jennifer Granick , executive director of the Stanford Law School Center for Internet and Society. "They all have excuses, but in the end it benefits their bottom line personally."

Cellphone innovation in the United States lags Europe and Asia, where people can buy phones without becoming beholden to a service provider. That means equipment makers with a global market may ultimately have different goals than US carriers.

That last paragraph is particularly noteworthy. Cell phone innovation has been greater in the geographies where the carriers have had less control over the customer experience. Could that be a model for the US market as well?

We're about to find out. As we and others have noted, Apple's deal with Cingular -- where Apple has taken the lead to generate consumer demand for the phone and dictated service and consumer experience terms to Cingular -- has started a small revolution in the US mobile phone business. The fact that Apple and its marketing machine can generate enough consumer demand not to require carrier subsidies -- and the carrier restrictions that come with such subsidies -- means that it now can wield more influence over US carriers than any handset maker has to date.

We're about to see that influence in action. Case in point: Think Secret has rumored that iPhones bought through the Apple Store will be activated through the iTunes store without ever coming into contact with a Cingular representative. Even more revolutionary, iPhones will automatically switch to WiFi access whenever they are in range of a hot spot, thereby bypassing Cingular data services much of the time. What carrier in their right mind expected the US mobile phone revolution to be sparked by a computer maker with a music store? And that they'd fall into a deal where consumers would buy unlimited data access plans on their network, yet get much of their data via free WiFi?

As Bob Dylan said, the times, they are a changin'.

Full disclosure: the author owns Apple stock at the time of writing.

Technorati Tags: Apple, Bob Dylan, Cingular, iPhone, Marketing, Mobile phones