Senators Sniff Around Exclusive Handset Deals

from the lurking-with-intent dept

A group of senators has announced they'll hold a hearing in Washington on Wednesday to examine exclusive deals between mobile handset vendors and operators, and has asked the FCC to look into the practice. The senators want to know if the deals (such as those that make the iPhone exclusive to AT&T and the Palm Pre to Sprint) "unfairly restrict consumer choice or adversely impact competition". Exclusive deals are becoming a big part of the operators' strategies as they look to grab users from their rivals. As prices, coverage and other competitive factors reach a degree of parity, exclusivity on certain devices is a major way the operators seek to differentiate themselves. Smaller and rural carriers argue this puts them at a disadvantage, because of their small size, which makes it impossible to compete for hot devices if a bigger operator wants an exclusive deal. The senators seem to be capitalizing on the recent outcry from some iPhone owners regarding AT&T's upgrade policy, as well as its lack of support for new features in the latest version of the iPhone software. It's unclear just how far the senators want to take this. For instance, if exclusives are banned, would manufacturers be forced to build variants of a handset for any operator's network? Say the exclusive deal for the iPhone was abolished. Would Apple be forced to build a CDMA version for Verizon and Sprint? Would it have to make a model that supported the frequencies used by T-Mobile's 3G network? Hopefully the attempt to gain some publicity by seizing on a hot topic won't lead to rushed legislation that brings unintended consequences.

Carlo Longino is an expert at the Insight Community. To get insight and analysis from Carlo Longino and other experts on challenges your company faces, click here.

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Motorola's Handset Business On The Brink?

from the going,-going... dept

Anybody that's followed the fortunes of Motorola's mobile-phone unit over the years knows it's been a story of ups and downs. The company has had a number of blockbuster hits over the years, like the StarTAC and the RAZR, but hasn't been able to fill in the gaps between them with other successes. Now, Phone Scoop is reporting that the company is preparing to lay off up to half its staff. In addition, the company will only release a dozen devices this year, and it's dropping the Windows Mobile platform, favoring Android instead for its smartphones. The writing has been on the wall for Motorola for a while, as it struggled to follow up the iconic RAZR with another hit. Coupled with the current economic slowdown, it looks like Motorola's handset business could be headed for the deadpool, unless a buyer emerges for it. Perhaps that should be "buyer" -- there's been a lot of talk that Moto would have to pay somebody to take the business off its hands.

Carlo Longino is an expert at the Insight Community. To get insight and analysis from Carlo Longino and other experts on challenges your company faces, click here.

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Motorola Casts Handset Business Off To Survive On Its Own

from the fly,-fly,-fly-away-little-razr dept

A few months ago there were rumors that Motorola might sell off its struggling handset division to another provider, however there didn't seem to be many interested buyers. It appears that Motorola has chosen option two instead: spin off the business to survive (or fail) on its own. The business accounts for the largest chunk of Motorola's earnings, but it is also a huge drag on earnings. Basically, the other parts of Motorola had been subsidizing the handset business. It's still rather amazing how slow Motorola is to come out with interesting handsets that people want. It had a huge success with the Startac in the 90s and then took nearly a decade before finding another hit with the RAZR. But just as with the Startac, it milked the RAZR concept for all it was worth and now is left in the dust while other firms are putting out much more innovative phones. Spinning off the business may separate it from the other parts of Motorola's business, but unless it starts designing phones people actually want, it's not going to make much of a difference.

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