Are You Ready for Apple Mobile?
During those alarmist days when Apple’s (NASDAQ:AAPL) stock had seemingly been struck suddenly by gravity, questions were posed about what the company could do next to keep growing. But the gloom at that time — only two weeks ago, though it seems like ancient history now — disappeared in a blink after the company announced blockbuster first-quarter earnings, and everything was right again in investor world.
Still, while it’s obvious that sales of the iPad and the iPhone, Apple’s biggest revenue earner, are still going strong, and new products and markets will keep business growing for a while, it can never hurt to implement new strategies early to maintain growth as markets become saturated. Word now is that Apple may be looking to diversify and become a wireless carrier, selling plans directly to consumers through iTunes.
Are you ready for Apple Mobile?
According to telecom industry advisor Whitey Bluestein, it may be time for Apple to make its Dynamic Carrier Selection patent from 2006 a real product. In the patent, a diagram showed Apple as a wireless service provider connected to multiple carriers. Bluestein writes for GigaOM that such a plan would let Apple make “wholesale cellular agreements with and connect to multiple carriers so it could offer its customers choices in carriers, plans and services.”
The company is likely to start with selling data packages bundled with iPads, later offering data and international roaming plans on the iPhone, and then gradually moving to wholesale deals with mobile operators that will offer a complete package. But as a step ahead of even that, Apple has already begun attempts to create a smaller-sized SIM card for GSM and LTE handsets that would let it bypass carriers entirely.
Bluestein says it will be hard for domestic and global mobile operators like Verizon (NYSE:VZ), AT&T (NYSE:T), the British Vodafone (NASDAQ:VOD), and Spain’s Telefónica (NYSE:TEF) to refuse Apple’s offer because of the phone maker’s immense bargaining power. The company makes up huge sales for the carriers: four out of five smartphones sold by AT&T in the first quarter were iPhones.
Apple also has a loyal brand following, hundreds of retail stores, and dependable customer service, along with an already established digital billing platform in iTunes — all advantages that would give it a head start over a company like Google (NASDAQ:GOOG), for instance, said Bluestein. It could also be immensely profitable, as iPhone users tend to spend twice as much money or more than the national average wireless bill.
In any case, the time when Apple will be a one-stop shop for all of consumers’ digital needs may be somewhere not too far down the road.