Everyone may be focused on the forthcoming T-Mobile iPhone, but T-Mo revealed a strategy Thursday that will have far greater implications for the mobile industry. By eliminating subsidies it’s changing the way phones and services are sold and altering the consumer’s relationship to the carrier.
At Deutsche Telekom’s analyst conference, T-Mobile CEO John Legere revealed that T-Mo’s deal with Apple will include the iPhone, but it will also coincide with a radical change in its pricing. It’s eliminating subsidies entirely, charging customers full price for their devices.
An editor at the Guardian argues that newspapers should be funded by a tax on internet service providers, because public journalism needs to be supported. But there are a host of flaws with the idea, including the fact that large newspapers are not synonymous with journalism.
AT&T has stopped subsidizing tablets, recognizing that it can’t sell slates the same way it sells smartphones. Now AT&T and other carriers need to start dropping tablet data plan pricing. If we’re no longer “paying back” the device subsidy, we shouldn’t be paying subsidized plan prices.
There may be more to Apple’s new deal with Leap Wireless than meets the eye. Apple could be using Leap as a guinea pig carrier to test if American consumers are ready to pay full price for their iPhones, according to a BTIG analyst.
Verizon Wireless apparently isn’t done talking about its controversial plan to phase out “grandfathered” unlimited data plans, issuing a statement Thursday explaining the new policy. What it boils down to is this: You can keep unlimited, but don’t expect Verizon to subsidize your device.
T-Mobile CMO Cole Brodman said if he had a magic wand he would use it to eliminate subsidies in the wireless industry. That’s big talk for a carrier, but apparently T-Mobile is willing to do something about it: raise data plan prices on subsidized phones.
At midnight on New Year’s Day the Department of the Treasury’s Section 1603 cash grants program expired, dashing the hopes of those who have expressed legitimate concern that the end of various grants and tax credits will further devastate the embattled solar industry. And yet, when it comes to subsidies, support for fossil fuels continues to grow and nobody blinks an eye. While the reasons for this are many and complex, the impact is that we never know the true cost of power and fuel and that alternative energy has to compete on some uneven terrain.
The dramatic news last Wednesday that the $3 billion U.S. solar industry bellwether First Solar was exiting subsidy-dependent markets and instead shifting focus toward utilities was a sobering indicator of what the subsidy environment will look like in the next few years. First Solar’s new strategy will reverberate across the solar industry, as everyone will have to answer the daunting question of how they will survive in decreasingly subsidized markets.
The tablet market is growing rapidly — but it could be getting even more of a boost thanks to the growing number of operator subsidies on offer. The latest? A series of cut-price deals aimed at France’s large student population.