Apple sued over third-party reseller inventory practices

Apple has an immensely successful self-run retail arm, but it wasn’t always that way. Once, it depended heavily on the kindess of strangers, and some of those same strangers (namely third-party resellers) are now bristling at what they see as unfair business practices.

An MVNO could be Google’s latest plan to disrupt mobile

The European rumor mill heated up last week with reports that Google is toying with an MVNO-like service for its employees. Google isn’t commenting, and one conflicting story even claims that the initial report was a hoax. But Google is aggressively pursuing just about every other segment in mobile, and tinkering with an MVNO could be the first step toward disrupting the mobile market in a big way.

The Nexus One and Google Voice: designed to disrupt

Offering its own service would be a bold play, but Google has shown no fear in challenging existing mobile power structures. After shaking up the industry with Android, Google took a bold swing at the established handset-distribution model almost two years ago with the Nexus One, an unsubsidized handset that wasn’t tied to a single carrier and was initially available directly from Google rather than through carrier channels. The HTC-designed gadget was distributed by Google and marketed on its home page before Google acquiesced and made the phone available through T-Mobile USA retail outlets.

And while the Nexus One may have been the most egregious example of Google’s chutzpah in mobile, it isn’t the only one. As Om wrote more than two years ago, Google Voice “essentially reduces the cell phone carrier to a dumb pipe” by enabling users to make calls within the app as well as send text messages, access voicemails and manage their contacts and conversations. Google has continued to build out its offering by allowing users to port their mobile numbers to Google Voice and, earlier this year, inking a deal to integrate the app across Sprint’s lineup of both smartphones and feature phones. Google Voice amassed an audience of 1.4 million in just seven months after its 2009 launch; the company has declined to discuss how much it has grown since.

These initiatives have seen mixed results, but all share a common strategy: Gently push the envelope of the mobile industry when possible, pull back when necessary, and stay focused on the long haul. The Nexus One distribution strategy has been dubbed a “failed experiment,” but it was likely just the initial attempt. The reported MVNO in Spain might be the first real step.

Why a Google MVNO could work

The MVNO space in the U.S. is littered with casualties, from high-profile flops such as Disney Mobile and Mobile ESPN to Amp’d, a glorious debacle that raised $360 million in funding before tanking. But most of those failures were based largely on branding and content. Google could differentiate itself with an offering built on useful services such as Google Voice and Google Wallet. And it could market the service as an edgy, feature-heavy offering for tech-savvy power users — an area that was overlooked in the era of youth-oriented MVNOs. The move could create a new revenue stream as well as build a fertile user base for Google’s ever-growing portfolio of mobile apps and services.

That kind of bold move risks angering Google’s mobile partners, of course. Google would have to move slowly and be ready to retreat (as it did with the Nexus One) if the costs outweigh the potential gains. But there are operators who might smile through clenched teeth at the thought of supporting a Google MVNO: Deutsche Telekom could find such an arrangement attractive for its struggling T-Mobile USA business if the AT&T acquisition ultimately fails. Clearwire, which has recently considered providing capacity for carriers in addition to Sprint, could also be a possibility.

Google isn’t going to spring a U.S. MVNO in the next few months. But as it demonstrated with the Nexus One, it isn’t afraid to patiently dismantle the mobile industry one brick at a time. Spanish operators may soon see the latest example of that with a Google MVNO. And U.S. carriers could be next.

Question of the week

Could Google launch a successful MVNO?

RIM’s BlackBerry 7: A case of unfounded optimism

After months of getting its teeth kicked in by Apple’s iOS and Google’s Android, things appear to be looking up for Research In Motion. All Things D claimed this week that RIM is “on the rebound,” thanks to a new pair of handsets running BlackBerry 7. Mobile Computing News proclaimed that the comeback is “already under way,” and investors have swooned, too, boosting shares as much as 10 percent early in the week.

Don’t believe the hype. BlackBerry’s market share among U.S. smartphone owners continues to slide, and a revamped BlackBerry OS will do precious little to slow that decline. RIM needs to produce some QNX-powered phones that are as compelling as the iPhone and its competitors, and quickly.

In addition to the upgraded OS, RIM backers say Nokia’s transition from Symbian to Microsoft’s Windows Phone provides an opportunity for RIM to regain some ground in the U.S. Nokia’s Windows Phone–powered handsets aren’t likely to hit North American shores until next year, Sterne Agee analyst Shaw Wu told All Things D, giving RIM more time to position itself as the major alternative to Android and the iPhone. What’s more, RIM is hoping to hold on to existing customers with its Trade Up program, which gives buyers of new BlackBerry gadgets $100 in exchange for their old, fully-functioning BlackBerrys.

The problem, though, is that none of these factors will bring RIM any new customers. BlackBerry 7 offers increased speed and new security tools, but it’s an incremental improvement of an old operating system that is simply inferior to Android and iOS — it’s less intuitive and simply can’t support the immersive apps and games that make younger platforms so compelling. In fact, the upgrade is strikingly similar to last year’s rollout of BlackBerry 6: an improvement that narrows the gap with the competition but doesn’t offer enough to be a threat. (It’s worth noting that BlackBerry’s share of the U.S. smartphone market has dropped precipitously in the past year.) Indeed, Tech Trader Daily reported this week that one analyst found a “relatively muted response” to the new handsets at carriers’ retail outlets. And it doesn’t help that RIM’s trade-in program targets existing BlackBerry owners, not users from other platforms.

The competition is fiercer than ever, too. Apple is expected to unveil the iPhone 5 in the next several weeks, and the Wall Street Journal reported last week that Sprint will soon offer the iconic device. Android is enjoying a worldwide market share of nearly 50 percent, according to recent data from Canalys. And Nokia/Microsoft looms like a building storm, particularly given Microsoft’s enormous presence among the kind of business users that are RIM’s bread and butter. Even if Wu’s prediction is accurate, RIM has only a few months before the wave of Nokia Windows Phones hits the U.S.

While RIM hopes to target budget-conscious smartphone shoppers with phones like the new BlackBerry Torch 9810 (which AT&T offers for $50), that market is getting more crowded. Sprint, for instance, recently launched a WiMAX-enabled, Android-powered Samsung Conquer 4G for a mere $50. Reuters reported last week that Apple is launching a stripped-down iPhone for the emerging markets that have become crucial to RIM as it loses footing in North America.

RIM is on the right track with some of its new phones, which combine consumer-friendly features like colorful touchscreens with the full QWERTY keyboards that some business types demand. But it must ship those devices with QNX, which supports the kind of mobile entertainment offerings that users increasingly demand. It must aggressively grow its community of QNX developers to ensure it offers enough applications to keep its users happy. And then to help move those phones, it must strengthen the crucial carrier support that has withered alongside BlackBerry’s market share. If it can’t do all those things in the near future, its chance to become anything more than a niche option for businesses will disappear.

Question of the week

Will BlackBerry 7 do anything to help stop RIM’s bleeding?

Today in Mobile

Google unveiled its long-awaited mobile payment system during a press conference in New York today, and the company has forged an impressive alliance: Citibank, MasterCard, Sprint and First Data are among the initial partners, and Google Wallet will be supported by more than 300,000 retail outlets and restaurants at launch. Google is enticing consumers by offering $10 in a new account, and the company is clearly hoping that the system’s discount offers will be enough to convince them to continue using the system. But the mobile payment space still has some substantial hurdles to overcome — from a lack of NFC-enabled handsets to changing the way consumers think — so this space will evolve much more slowly than some of the headlines would have you believe.

Today in Mobile

Apple continues to dominate the tablet space it single-handedly created, but I’m beginning to think that Research In Motion’s PlayBook could provide some competition. RIM announced today that its tablet will start at $500, which has become a crucial starting price point thanks to the success of the iPad. And getting your hands on the PlayBook will be easy: the gadget will be sold at more than 20,000 retail outlets in the U.S. and Canada, including Best Buy, RadioShack, Office Depot and AT&T stores. If the PlayBook can deliver a more business-friendly experience than the iPad — and it should be able to — RIM could quickly become a player in the oh-so-young tablet market.