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European carriers threaten Apple over embedded SIM option

post #1 of 120
Thread Starter 
Carriers in Europe are threatening to cut subsidies if Apple releases an iPhone with an embedded SIM card, a new report claims.

In October, reports emerged claiming that Apple has been working with Gemalto to develop an open SIM for integration into the iPhone. An embedded SIM card could allow customers to choose between competing carriers and activate service right from the Apple Store.

According to a Financial Times report, European wireless operators are riled up about that possibility. "The operators are accusing Apple of trying to gain control of their relationship with their mobile customers with the new SIM," wrote author Andrew Parker. With the embedded SIM, customers could insist on shorter-term contracts, using the ability to easily switch between carriers as leverage.

In response to the rumors, the carriers are "privately saying" that they could refuse to subsidize the iPhone if Apple goes through with an embedded SIM, Parker wrote. Among European operators, Vodafone in the UK, France Telecom and Telefónica in Spain are "known to have concerns" about Apple's interest. One European telecom senior executive said the new SIM could lead to a "war" between operators and Apple.

In just 3 years, Apple's iPhone has already shaken up the wireless industry, and a multi-carrier integrated SIM would cause further disruption for carriers. Bernstein analyst Robin Bienenstock told the Financial Times that an embedded SIM could ultimately prove to be the first step in a process in which [the mobile operators] cede customer control to handset vendors like Apple, [and are] relegated to commodity capacity providers.

That step, however, could cost Apple. Bienenstock estimated that Apples global iPhone sales could take a 12 percent hit if European carriers made good on their threats to drop subsidies for the handset.
post #2 of 120
asuming of course that all mobile carriers in a country are on board. Else Apple might just offer the iPhone to other carrier who'd happily take it. And customers beeing customers and wanting an iphone they'd just change carriers.
post #3 of 120
Let them complain. There will always be a carrier wiling to pay the subsities to get the iPhone. When it comes time, they'll all remember the demand the iPhone 4 generated. And they'll want in. Let them complain.
post #4 of 120
This makes no sense. I'm not sure how it works in Europe... but in the US, if you switch carriers, it costs a boat load in early termination fees.

if the contract is up... then how is this integrated sim any different from swapping out the sim with a new carrier. It's more convenient and easier sure, but if someone wants to switch carriers, they will do it whether or not there's an App for it.
post #5 of 120
If the carriers don't subsidise the iPhone cost they won't have the leverage to lock you into a contract by stating that they need to re-coop the subsidy over xx months. If you have to pay £600 for the phone you might as well go for a 'sim only' type contract on a rolling monthly basis. The initial cost will be higher but your monthly will be lower.
post #6 of 120
Yeah like they would risk giving up the greatest selling product in HUMAN HISTORY! They would have riots on their hands, nobody would be using the carriers. Everybody would be boycotting their asses till they go broke or give in. I hope they do cause it would be HILLARIOUS!!!
post #7 of 120
Quote:
Originally Posted by OllieWallieWhiskers View Post

This makes no sense. I'm not sure how it works in Europe... but in the US, if you switch carriers, it costs a boat load in early termination fees.

They're afraid that since consumers will be able to change their SIMs on a whim, consumers instead will want to have shorter or contract-less plans, using the fact that the integrated SIM can be changed easily.

Basically, they're afraid that this could cause customers to rally against contracts locking them into service, God forbid you listen to or give power to the customers.
post #8 of 120
honestly i'm with apple on this one. The age where your phone is utterly useless on another carrior is crap. to me it'd be like buying a laptop then not being allowed to use it if i change ISPs. A phone is just hardware, it should not be your contract or your carrior. I think the phone should just be a phone. and carrior be the provider only. not the provider and the phone. if carriors want to keep customers they should do it by having better coverage or options, not cause a 500 dollar phone you purchased can't be used with anyone else. I've had many phones, prior to iphone. and they are all useless 200-400 dollar smartphones. It's ridiculous.
post #9 of 120
But... Wouldn't it make it harder to change SIM's? I mean, with an integrated SIM, wouldn't I need to sync my phone or hookup to some software to make the change?

Currently, I can just take the SIM card out and put another one in... how much easier does it get?

Not to mention, wouldn't it be smarter to stop throwing away all those plastic cards that SIM cards come punched into and start using some sort of reusable option?

F'n, money grubbing whiners didn't stop to think for 2 seconds.
post #10 of 120
Steve J., if you're tuning in this is what we all want. I have a phone line and I can plug any phone I want on my line, any manufacture, make, model etc., why should Cell phones be any different? I should be able to use any phone I want and change it at anytime, or change my service without trashing my phone, sorry iPhone. Keep moving forward!
post #11 of 120
This kind of ganging up against the consumer seems to me to be anticompetitive.

Where are the EU competition commissioners when something blatant like this happens (assuming these guys did indeed make these kinds of implied threats)?
post #12 of 120
Quote:
Originally Posted by bcode View Post

But... Wouldn't it make it harder to change SIM's? I mean, with an integrated SIM, wouldn't I need to sync my phone or hookup to some software to make the change?

Currently, I can just take the SIM card out and put another one in... how much easier does it get?

Not to mention, wouldn't it be smarter to stop throwing away all those plastic cards that SIM cards come punched into and start using some sort of reusable option?

F'n, money grubbing whiners didn't stop to think for 2 seconds.

I don't get it either. Apple would be able to carrier lock your iPhone even with an integrated SIM. I also think this way it will be harder to unlock it using jailbreak since it could be a hardware lock.
post #13 of 120
How's about Apple takes some of that pile of cash and buys a carrier, or creates a new one? How'd you like them apples?
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post #14 of 120
Quote:
Originally Posted by Bevelmon View Post

I should be able to use any phone I want and change it at anytime, or change my service without trashing my phone, sorry iPhone.

And that is what you would be able to do. The beauty is that the SIM wouldn't be 'burned' and the new carrier just adds that id into their system. No having to deal with a carrier trying to make you pay for a new sim (ATT tried to get $20 off me to get a clean sim for my old iphone). Quick software update adds the appropriate carrier id to the phone so it talks to the right service. Done

Given that the iphone now use micro-sims, pulling the sim out and putting it in another phone doesn't really work since few other phones also use micros at the moment. In the future it might be an annoyance but not so much at the moment

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post #15 of 120
Ahh... the beginning of the end for carrier dominance. I welcome it.

Basically, carriers need to shut up, sit down, and provide a monthly plan for access that is unlimited in everything. that's it.
post #16 of 120
Quote:
Originally Posted by iansilv View Post

Basically, carriers need to shut up, sit down, and provide a monthly plan for access that is unlimited in everything. that's it.

And, free too.
post #17 of 120
So where are all the usual European suspects who come in and post how they can change SIM cards whenever they want and pay 2€ for billions of GB of data for tethering to their laptops at phenomenal speeds everywhere they go and unlimited calls because Europe is oh, so much better than America and networks there allow freedom to do what you want backed up by the EU.

Quote:
Originally Posted by iansilv View Post

Ahh... the beginning of the end for carrier dominance. I welcome it.

Basically, carriers need to shut up, sit down, and provide a monthly plan for access that is unlimited in everything. that's it.


Don't worry, Google will step in with Android to pick up the slack and put things back the way they were, for the carriers.
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post #18 of 120
This is a funny link...

http://it-chuiko.com/mobile/7394-mob...sim-karty.html...

"participate in the project, companies such as AT & T, China Mobile, Deutsche Telekom, France Telecom Orange, NTT DoCoMo, SK Telecom, Verizon Wireless, Vodafone and others "
post #19 of 120
If there is anyone from Apple reading this thread, don't worry about their threats. The thing is they can't survive without the iphone and you would be empowering your customers. You have said that you care and this is one way of showing you do. The cell companies have basically gone nuts with their pricing, especially data plans. Using AT&T's bandwidth calculator just basic online usage hits 5GB a month, without its online capabilities the iphone is useless. I'd love to see a wimax hot spot edition as sprint has unlimited bandwidth no caps and upto 6Mbps connection and includes 5GB of 3G for ultimate mobile connectivity but i know that will not happen. I don't expect LTE data plans to be pocket friendly. Calling while traveling internationally will also become more affordable and that's really when you need a device like an iphone. Lots of travel apps depend on a connection.

From a business point of view making one global CDMA/GSM iphone with a universal sim is one way to make one iphone for the globe which would be a major savings for you. It would simplify registration and sales and also give your customers worldwide a choice of their carrier with competitive plans. Preorders and self activation could really streamline and speed up launch day sales. It would also allow you to sell the iphone unlocked and give the carriers the opportunity to subsidize if they so choose like they do in Canada (unlocked and subsidized now that is true genius) . Regardless of the price people will pay for the iphone, just go to ebay. Even first gen phones are selling for ridiculous amounts. People may grumble but they will still be lining up in mass on launch day.

So show us customers (who pay for the mighty war chest) some love.
post #20 of 120
1-200MB covers basic online usage, fairly heavy usage 1-2GB, realistically the only way to get anywhere near 5GB is by tethering or watching YouTube 24/7.

Quote:
Originally Posted by iLad View Post

Using AT&T's bandwidth calculator just basic online usage hits 5GB a month, without its online capabilities the iphone is useless.
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post #21 of 120
Quote:
Originally Posted by hill60 View Post

So where are all the usual European suspects who come in and post how they can change SIM cards whenever they want and pay 2 for billions of GB of data for tethering to their laptops at phenomenal speeds everywhere they go and unlimited calls because Europe is oh, so much better than America and networks there allow freedom to do what you want backed up by the EU.

Don't worry, Google will step in with Android to pick up the slack and put things back the way they were, for the carriers.

had to chuckle - at both points.
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post #22 of 120
So what's the difference between this and the unlocked versions you can currently get in Canada and the UK? Besides, those subsidies aren't nearly enough to offset the amount you'd have to spend to a carrier over a 2 year contract.
post #23 of 120
I don’t get what they are concerned about. Just like with the current SIM card system Apple can lock the handset to a carrier or sell it unlocked.

They make contracts with carriers when they could have sold the device unlocked in most, if not all, nations. All this idea seems to do is save Apple some space. They can use the OS UI to setup the device whether it’s locked to a carrier or not.

I can’t imagine many will want to pay the full price for the handset with a built-in SIM. It’s not like switching the SIM is an ordeal.

And what is with a French carrier being concerned? Wasn’t there an issue that required the device to be sold and used on all carriers?
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post #24 of 120
a universal iPhone would be awesome. it would streamline costs and decrease overhead, particularly for the carriers who maintain retail stores whose sole purpose (just about) is to deal with sim cards.

but europeans are completely insane so who knows..
post #25 of 120
I think some folks here are being anti-carrier just for the sake of being anti carrier. I'm thinking about it from a customer's standpoint. If it requires special software or something to update an integrated SIM, that means I need to give my phone to the carrier to update? Or is Apple trying to also require that it's an over-the-air update under Apple's control? But what if I don't have service in the country I just arrived in? How do I get a connection to update my iPhone to get a connection? Catch-22. What if I travel to an area that Apple doesn't have a contract with to update my iPhone to work on a local carrier? Then you are simply screwed as there would be no way to make your phone work there.

I'm surprised people are so willing to give up the freedom to be able to pick up a SIM card wherever you are and pop it in. Wouldn't it be better for Apple to leave the SIM card slot and just sell unlocked phones? I'm going to be a pessimist here and view this as an attempt by Apple to force carriers to sign contracts with them, even if the carrier doesn't carry the iPhone. Today, an iPhone user can choose to use any carrier if they have an unlocked iPhone. With an integrated SIM, you are limited to only "Apple-approved" carriers. And if Apple doesn't happen to have an arrangement with the carrier you want to use, tough luck for you.
post #26 of 120
Quote:
Originally Posted by hill60 View Post

So where are all the usual European suspects who come in and post how they can change SIM cards whenever they want and pay 2 for billions of GB of data for tethering to their laptops at phenomenal speeds everywhere they go and unlimited calls because Europe is oh, so much better than America and networks there allow freedom to do what you want backed up by the EU.

LOL - I was waiting for someone to point this out. Thanks for pointing out the irony
post #27 of 120
Quote:
Originally Posted by Wiggin View Post

I think some folks here are being anti-carrier just for the sake of being anti carrier. I'm thinking about it from a customer's standpoint. If it requires special software or something to update an integrated SIM, that means I need to give my phone to the carrier to update?

I think you are being overly paranoid. If this restricted your choice to running to the carriers, why exactly are they up in arms?
post #28 of 120
Down here in sunny South Africa we have more cell contracts then people. Sim swapping is a regular occurrence and quite handy. Admittedly the point on micro-sim is a good one but surely we need the choice?
post #29 of 120
Quote:
Originally Posted by Wiggin View Post

I think some folks here are being anti-carrier just for the sake of being anti carrier. I'm thinking about it from a customer's standpoint. If it requires special software or something to update an integrated SIM, that means I need to give my phone to the carrier to update? Or is Apple trying to also require that it's an over-the-air update under Apple's control? But what if I don't have service in the country I just arrived in? How do I get a connection to update my iPhone to get a connection? Catch-22. What if I travel to an area that Apple doesn't have a contract with to update my iPhone to work on a local carrier? Then you are simply screwed as there would be no way to make your phone work there.

I'm surprised people are so willing to give up the freedom to be able to pick up a SIM card wherever you are and pop it in. Wouldn't it be better for Apple to leave the SIM card slot and just sell unlocked phones? I'm going to be a pessimist here and view this as an attempt by Apple to force carriers to sign contracts with them, even if the carrier doesn't carry the iPhone. Today, an iPhone user can choose to use any carrier if they have an unlocked iPhone. With an integrated SIM, you are limited to only "Apple-approved" carriers. And if Apple doesn't happen to have an arrangement with the carrier you want to use, tough luck for you.

Let's break this down a bit since you want to blizzard issues here:

- why would it require special software? why wouldn't a hardcoded registry code that could be read off the device or input and validated on first call work? So you don't have to give the carrier anything except the code from the phone and they validate when used.

-Apple doesn't have to support anything like supplying updates like that - think logistics here instead of panicking because you can't conceive of a workable, intelligent, consumer-friendly system.

-No contracts just you buying a phone that simply works where and when you need it no extra SIM tray to futz with, no trying to buy a SIM card off a local supplier.

-just because you can't conceive of a system that doesn't require you running around buying little bits of trace-imprinted plastic to shove in your cellphone, doesn't mean there isn't a practical, sensible and consumer friendly way to do it. You are letting your paranoia blind you to the obvious. Will the carriers fight it - of course. They want as much control as consumers will allow them to be fooled into granting the carriers. But they are remarkably in the same boat as landline suppliers, media broadcasters/cable suppliers, and the recording industry - they are going to slowly and inexorably become commoditized - kicking and screaming all the way.
post #30 of 120
SIM cards made sense to me when they WERE the phones memory and you could move your SIM to a new phone and the contacts came with it.

These days no one keeps their contact on their SIM card, so go ahead and get rid of it already.

I don't see how an integrated sim affects customer loyalty or churn at all. The phone can still be software locked and subsidized, and you can STILL be required to sign a contract for service.

It would dramatically affect pay as you go users. If pre-paid/PayG users could instantly switch carriers when they ran out of minutes without going by a store to swap SIMs that would certainly have a huge affect.

Personally, I love the idea of getting off the plane in Bangkok and skipping the trip by the phone kiosk to buy a new SIM... tap tap tap and instantly I'm off AT&T and onto a new prepaid plan would make me very happy visiting other countries.

I want a factory unlocked phone in the US, clean and simple... but I might settle for a reversal of the way locking works now, instead of locking to exclusively AT&T, just block all (Tmo) the other US carriers, but leave the phone open to international PayG carriers.
post #31 of 120
Their complaints don't make any sense to me. The phone could still be carrier locked the same way it is now. The only thing they are eliminating is the need to pull out one carriers SIM and put in another carriers SIM on an *unlocked* phone. The only thing this changes is the effort to insert that liquid metal SIM card extractor.
post #32 of 120
Quote:
Originally Posted by esummers View Post

Their complaints don't make any sense to me. The phone could still be carrier locked the same way it is now. The only thing they are eliminating is the need to pull out one carriers SIM and put in another carriers SIM on an *unlocked* phone. The only thing this changes is the effort to insert that liquid metal SIM card extractor.

On top of that, there is still a way that carriers could add the key components of the Subscriber Identity Module to a card that ships with the device or is obtained through the carrier without the need for manual entry, as I mentioned above as the most effort that would be required.

For physical item they could use a simple card with a matrix barcode (QR code) and for a non-physical item in a carriers store they could use NFC (Near Field Communication). Both of which could be setup easily by accessing the phones settings.
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post #33 of 120
Quote:
Originally Posted by hill60 View Post

So where are all the usual European suspects who come in and post how they can change SIM cards whenever they want and pay 2 for billions of GB of data for tethering to their laptops at phenomenal speeds everywhere they go and unlimited calls because Europe is oh, so much better than America and networks there allow freedom to do what you want backed up by the EU.


What happens when you go travelling to another country with your unlocked phone, you want to place a local SIM in it so you can save on roaming charges, how would your intergrated SIM help you?
post #34 of 120
Quote:
Originally Posted by hill60 View Post

Don't worry, Google will step in with Android to pick up the slack and put things back the way they were, for the carriers.

Horrors if Google Android gets more common.
Based on my problems getting service from Google for my Gmail account, I don't want to think of the problems getting Android service.

Google gives lots of OK software away, but it's on a best efforts basis for service. Not surprising service is limited for a give away product.
With Google software and services you are on a your risk basis. Take it or leave it Chum.
post #35 of 120
A built in SIM sounds very efficient and convenient, but I expect the main concern by the carriers is the power it gives Apple.
Apple's iPhone strength is already concerning the carriers.
post #36 of 120
Quote:
Originally Posted by JoshA View Post

A built in SIM sounds very efficient and convenient, but I expect the main concern by the carriers is the power it gives Apple.
Apple's iPhone strength is already concerning the carriers.

To me, their idea sounds like something theyd submit to ISO, IEC, ETSI, etc. Something theyd make free since adoption doesnt look to harm their bottom line and could help it by giving them more freedom in their designs. Something akin to mini-DisplayPort.
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post #37 of 120
Quote:
Originally Posted by LewysBlackmore View Post

Let's break this down a bit since you want to blizzard issues here:

- why would it require special software? why wouldn't a hardcoded registry code that could be read off the device or input and validated on first call work? So you don't have to give the carrier anything except the code from the phone and they validate when used.

-Apple doesn't have to support anything like supplying updates like that - think logistics here instead of panicking because you can't conceive of a workable, intelligent, consumer-friendly system.

-No contracts just you buying a phone that simply works where and when you need it no extra SIM tray to futz with, no trying to buy a SIM card off a local supplier.

-just because you can't conceive of a system that doesn't require you running around buying little bits of trace-imprinted plastic to shove in your cellphone, doesn't mean there isn't a practical, sensible and consumer friendly way to do it. You are letting your paranoia blind you to the obvious. Will the carriers fight it - of course. They want as much control as consumers will allow them to be fooled into granting the carriers. But they are remarkably in the same boat as landline suppliers, media broadcasters/cable suppliers, and the recording industry - they are going to slowly and inexorably become commoditized - kicking and screaming all the way.

Oh, I can conceive of a system such as you describe. But it involves one where the carrier use Apple's method of updating the SIM. Therefore, it limits you to only be able to use carriers that Apple has deemed "approved". Does it mean less control by the carriers? Sure, that's why they are upset. But while that's a good thing, it also means more control by Apple, not you. Think back to DRM'd music. How many people bitched because they couldn't play their music on non-Apple devices?

Go back and read the original article about how the embedded SIM would work. It's still a SIM. It needs to be re-encoded/updated for each carrier you want to use. There's no "hardcoding" as you mentioned above. If that were the case, we'd be right back to the pre-SIM days. If you wanted to use the iPhone with a new carrier, you'd need a new "virtual SIM" added to the embedded SIM. Therefore, you need some sort of system you'd connect your phone to at the carrier's kiosk, or an over-the-air update via software, to add a new carrier to your phone. Either way, it's completely under Apple's control as to who they determine to have agreements with. If the carrier doesn't have an agreement with Apple, your phone won't get updated to work on their network because you certainly aren't going to hand-enter all the info necessary to make your phone work on the carrier's network.

I love Apple products and use many of them. But in case you haven't noticed, Apple lately has been more and more about controlling how they will allow you to use their products and how they can monetize that control (they are a for-profit business, after all). There are good aspects to what Apple is doing, but let's not blindly follow along like sheep just because it's Apple.
post #38 of 120
Quote:
Originally Posted by 2oh1 View Post

Let them complain. There will always be a carrier wiling to pay the subsities to get the iPhone. When it comes time, they'll all remember the demand the iPhone 4 generated. And they'll want in. Let them complain.

A lot has changed in the past 12 months.
post #39 of 120
Integrated SIMs will only hurt consumers. It's a backwards step into the murky world of CDMA.

What happens when your contract is up? Will you be able to change carrier? Who controls that process? I can only see this hurting consumer choice and ultimately reducing competition.
post #40 of 120
Quote:
Originally Posted by DocNo42 View Post

LOL - I was waiting for someone to point this out. Thanks for pointing out the irony


I split my time between Ireland and Europe, and I change my sim often to get around the high roaming charges. The micro sim already made it difficult, but this would make it impossible. A lot of Europeans travel over the summer and swop out their sims, I dont think this would prove popular with them. I only use unlocked phones, I have to. I think it's one of the reasons Nokia is often chosen.

It would allow the carriers to charge whatever they wanted for data though. Not good.
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