iPhone, Ringtones, and WiFi
September 20th, 2007

A recent Business Week column shows how the iPhone is shaking things up in the telecom industry. Peter Burrows Apple is already taking control of the Ringtones market:

The days of fleecing folks for $2.49 for a snippet of song may now be numbered. Apple will let you take any part of an actual song for $.99 (so long as you’ve also spent the $.99 to buy the original from iTunes). As far as I know, the carrier gets nothing. It’s not just the lost cash profits that will hurt. To the extent that the industry has to follow Apple’s lead–highly likely–then AT&T and its carrier pals will no longer be able to point so much to this silly market as proof that they can build profitable new consumer service offerings on top of their basic business of selling connections. If ever there was a market just waiting for disruption by the likes of Apple, this was it.

Burrows also points to the potential for the iPhone to leave cellular carriers behind and focus on wifi/wimax.

When the iPhone launched, Steve Jobs made a good show of talking up the merits of Ma Bell and its network. But today’s wireless download services work only with WiFi, not with AT&T’s or any other cellular carriers network. Jobs even went out of his way during his presentation to point out that WiFi is not only faster than the 2.5G network iPhone users now get from AT&T, but faster than 3G networks as well. Now, spin things forward to a future of ubiquitous WiMax connectivity, delivered in large part courtesy of Apple’s friends at Intel. If that day ever arrives, is there any doubt where Apple will focus its efforts?


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