Verizon Wireless Responds To Competitive Pressures By Promising To Open Its Network

from the good-news dept

Verizon Wireless is making big headlines today by announcing that it intends to open up their network to third party devices next year. This is great news. As Columbia law professor Tim Wu documented in an excellent paper earlier this year, the mobile device market has long been hampered by the "tar pit of misery, pain, and destruction" that is the wireless carriers' process for approving mobile devices and software. Wu found that Verizon Wireless was one of the worst offenders, micromanaging which devices could be used on its networks and insisting the vendors cripple features like Bluetooth or WiFi that might undermine its own business strategies. In our write-up of Wu's paper, Carlo argued that Wu's heart was in the right place but that talk of "wireless network neutrality" regulations was premature, because sooner or later companies would be forced by competitive pressures to drop their walled gardens.

That appears to be happening surprisingly quickly. Back in February, Carlo noted that Verizon Wireless was the last hold-out for the old "walled garden" approach, with the other carriers having already taken steps to open their networks. Two recent announcements—Apple's iPhone and Google's Android—likely spurred Verizon Wireless to follow suit. The iPhone is far from an open device, but it is a clear example of what can be accomplished if a technology company is given the flexibility to design a mobile computer without having to kowtow to wireless carriers' whims. The success of the iPhone has put pressure on the other carriers to come up with a competitive response, and building a device as compelling as the iPhone almost requires that technologists be given a free hand in making design decisions Sprint and T-Mobile's support for Google's relatively open Android operating system strengthened the impression that Verizon Wireless was the last hold-out for the walled garden approach.

Today's announcement is a smart business decision for a number of reasons. First and foremost, the way to succeed in high-tech industries is to be the platform that other companies use to build their products and services. If Verizon follows through on its promises and opens up its network, it will dramatically reduce the time and frustration required to get a new device approved for use on Verizon's network. That will make it the logical partner for innovative small companies seeking to launch a new mobile device, service, or software product. It will also make Verizon Wireless an attractive partner for firms wanting to make non-phone mobile devices. This announcement also takes the wind out of the sails of advocates for government-mandated open networks. Verizon Wireless doubtless prefers to open its network on its own terms and its own schedule, instead of having its hand forced by government regulators.

There are still a lot of questions to be answered: most importantly, how much the bandwidth will cost. If it sets the price too high, it will be hard for Verizon Wireless' partners to make a profit. Additionally, we won't know until we see the exact terms how open their "open" network really will be. It wouldn't be the first time a technology company started using the word "open" to describe fundamentally non-open products. But if the terms and price turn out to be reasonable this announcement should provide a big boost to innovation in the wireless space in the coming years.



Reader Comments (rss)

(Flattened / Threaded)

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    matt, Nov 27th, 2007 @ 1:26pm

    skepticism makes me question it

    slashdot's comments on this seem to indicate that they can use this process to deny people the ability to connect on their network because it is a proprietary form of CDMA. So I wouldn't hold my breath.

     

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    Ian Bell (profile), Nov 27th, 2007 @ 1:34pm

    Years of Experience Makes me Question it...

    .... as does the fact that, since Verizon Wireless is CDMA and not GSM-based, there is very little at stake here. Because CDMA is only prevalent as a networking topology in Canada and the USA, and thus the number of devices which can be sold into the market is smaller, relatively few devices are made available, and/or made available early, for this platform.

    CDMA is defacto a closed network -- it's not a healthy ecosystem. Verizon is just giving lip service to the anti-carrier hype and attempting to soften its image with a little strategic PR.

     

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      Mike (profile), Nov 27th, 2007 @ 2:01pm

      Re: Years of Experience Makes me Question it...

      Because CDMA is only prevalent as a networking topology in Canada and the USA, and thus the number of devices which can be sold into the market is smaller, relatively few devices are made available, and/or made available early, for this platform.

      And Korea, of course. But you have to admit that there's a pretty big market between the US, Canada and Korea... and it's a market of relatively well-off purchasers who are often early adopters of technology. No, it's not a GSM network, but I think people writing this off because it's CDMA are jumping too far.

      I agree that I doubt VZW will really be as open as the PR pitch... but it's not because of the CDMA network.

       

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    Ian Bell (profile), Nov 27th, 2007 @ 1:43pm

    Also, on the iPhone.

    The iPhone is a glorified blackberry. The statement above that it's somehow a poster child for wireless net neutrality is preposterous.

    If the iPhone wasn't kowtowing to AT&TWS, then where's the:

    - Sync over Bluetooth / WiFi
    - Support for iSync and .Mac
    - Native support for installable apps

    ... and why is it tied so tightly to iTunes?

     

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      Mike (profile), Nov 27th, 2007 @ 2:03pm

      Re: Also, on the iPhone.

      The iPhone is a glorified blackberry. The statement above that it's somehow a poster child for wireless net neutrality is preposterous.

      I won't speak for Tim, but to call the iPhone a "glorified Blackberry" misses the point entirely -- and, of anyone, you know that better than most people, Ian.

      However, more to the point, Tim wasn't calling the iPhone a poster child for wireless net neutrality. He was saying that it's the sort of competition that made VZW realize they needed to do more and to open up more. In other words, competition is driving progress in this area, meaning legislation probably isn't needed. That doesn't mean the iPhone is "the poster child for net neutrality." It isn't. And it doesn't need to be.

      It just needs to be serious competition for VZW forcing them to think about ways to innovate and compete.

       

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      Tim Lee, Nov 27th, 2007 @ 2:10pm

      Re: Also, on the iPhone.

      What part of "the iPhone is far from an open device" do you not understand?

       

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      ChurchHatesTucker, Nov 27th, 2007 @ 3:33pm

      Re: Also, on the iPhone.

      I was a happy VW user for many years, but when my (dumb) phone finally broke I decided to upgrade to a camera phone, and was stunned at VW's crippling of their higher-end phones.

      I'm now the happy owner of an iPhone.

       

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    Joel Coehoorn, Nov 27th, 2007 @ 1:44pm

    doubts

    I really think this is more of push to capitalize on using the word 'open' as a marketing gimmick. It's just too contrary to everything Verizon has stood for in the past. Boy would I love to be wrong on this one, though.

     

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    ZeTron, Nov 27th, 2007 @ 2:36pm

    Great News!!

    CDMA can be found in the following countires: USA, Australia, Canada, China, Hong Kong, India, Indonesia, Thailand, Aruba, Barbados, Bermuda, Brazil, Cayman Islands, Guam/Saipan, Israel, Jamaica, Macau, South Korea, Taiwan and Vietnam.

    Admittily most are small Island nations. However there are a few key players that have CDMA (slightly different varaitions, but gernally same concept).

    This is HUGE for Verizon and cell phones in general. I have been waiting for VZW to open up for years. I am glad they *finally* figured out that they still can make money with this logical approach.

    GSM may be the worlds leading, and not to knock it, but soon it will hit a platue in data speed capabilities. 3rd generation CDMA will surpass GSM in speed ability (greatly).

     

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      latch, Nov 27th, 2007 @ 4:33pm

      Re: Great News!!

      If not delusional this statement sounds at least like wishful thinking.

      3G GSM is already deployed. HSDPA is partially deployed and growing fast. How and when will 3G CDMA surpass GSM on speed?

       

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    Shun, Nov 27th, 2007 @ 3:38pm

    What does Open mean to Verizon?

    Sounds like Verizon is attempting to turn into a wholesale "dumb pipe" carrier. I would applaud them, but they seem to want to hang on to their retail end as well.

    Developers may shy away from wireless appliance building if they feel that native Verizon products will be favored on the Verizon network. This should be easy to test, once the code is released.

    Also, it'll be neat if developers find hidden "hooks" in the Verizon-branded phones that are not in the spec.

     

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    dave, Nov 27th, 2007 @ 6:28pm

    total misinformation from Verizon

    If they really wanted to be 'open', they would stop crippling the features of the phones they currently sell. To say, make a device and if it passes our tests, you can use it, IT'S BEEN DONE. If they were for-real, they would stop screwing up the phones, rather than asking someone to please make a new phone with the features people want, and sell it on your own, and we might not put too large of a hurdle in front of you. At least, we won't say no to everybody.

     

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    Anonymous Coward, Nov 27th, 2007 @ 6:58pm

    This is about the spectrum auction and looking good to the FCC, not about the iPhone.

    BTW, if China and India are CDMA, then there will soon be more CDMA handsets than GSM ones.

     

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    Aaron Martin-Colby (profile), Nov 27th, 2007 @ 10:49pm

    Don't trust 'em.

    I still don't trust them. In much the same vein as their flexible allegiances during the FCC auction debacle, Verizon has an ulterior motive of which we're just not yet aware.

     

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    Derek Kerton (profile), Nov 28th, 2007 @ 12:13pm

    Japan Is Also CDMA

    Nobody has mentioned yet that Japan's KDDI is also a leader in using CDMA technology.

    But an argument the other way is that Korea and Japan use different CDMA frequency bands that the US and Canada.

     

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