There’s been some buzz as of late regarding something “big” happening soon at $AAPL. A UPS worker confirmed seeing some packages bound for Cupertino, what it means nobody knows. Upon further investigation, I’ve seen numerous articles about how Apple will become a wireless carrier and sidestep it’s partners $VZ, $S & $T. The concept of Apple providing their own voice & data network isn’t exactly a new idea. Back when the original iPhone was released, Jobs stated that he wanted Apple to focus on what it was good at and partner with AT&T to provide the mobile infrastructure.
Things have changed a bit since 2007. Apple has a massive retail distribution network, over 150 million active credit cards on file and they’re sitting on a ton of cash. They could probably build out a nationwide network if they wanted to sure, but would they be willing to shift the company into the telecom industry? Currently, the carriers are paying much higher subsidies for iPhones than any other devices and the more that are sold, the more infrastructure costs grow. Building out a new 3 or 4th generation network requires extensive capital for switches, towers, cabling etc. With all of the regulatory headwinds that the major carriers face, is it worth it for Apple to take the leap? Would they really burn their past partners who have provided the data backbone for the wildly popular iOS platform? I’m not so sure.
One thing is certain – Apple needs a better strategy for getting people to pay for data on their iPads. According to ABI research, only 25% of iPads sold are 3G/4G capable and of those, only about half are activated on the cellular networks. If Apple were able to re-sell cellular data from major carriers, they would have the ability to deliver better pricing and performance to customers. iPad connectivity would only be focused on the data side rather than voice and it could help Apple get more mobile data subscribers. In the end, there are lots of moving pieces here. Check out the link below for more info on this topic.
Via E-Commerce Times