For years, Google has been preparing to offer wireless
mobile service. They currently
design and sell phones online, make the most used mobile software in the world,
and are capable of providing internet service with Google Fiber. However, instead of paying for and
putting up their own cell towers, they will use the networks of Sprint and
T-Mobile to provide their service.
In return, Google is expected to pay $2 per gigabyte to those carriers,
which will still allow them to provide very cheap service. That being said, what would happen to
AT&T and Verizon, who would lose market share and not benefit at all from
Google customers? Another interesting
point in the article: if this happens, will Apple look into providing their own
service with their iPhones?
http://money.cnn.com/2015/01/23/technology/mobile/google-wireless/index.html?iid=HP_River
12 comments:
I think it's highly probable that Apple would do the same thing as Google. Apple have a very loyal customer base and they would be successful just because they are Apple.
I also agree with the statement that Apple will soon join the mobile carrier market. It will be interesting to see how the competition plays out in the future. While Google and Apple are both huge players and have extremely loyal customers, I doubt Verizon will be hurt as much as Sprint due to their multiple product offerings (cable, internet, etc).
Sprint and AT&T will be major server providers in my eyes still regardless even with the news of Google considering their options of joining this market. They have loyal followers and offer a variety of services. Apple and Google would be successful in infiltrating the mobile carrier market I believe. Apple keeps producing successful products and have very loyal followers. Google is such a large and successful company they will have a great deal of success in this market. One possible idea I could see maybe happening is Google buying a smaller mobile server such as T-Mobile or Sprint. This could help them infiltrate the market and give them guidance about this industry. Do we have a possible merger on our hands? We will have to wait and see.
Because of the extremely loyal customer base that Apple has and the reputation that Google upholds, I wonder if we would eventually see a narrow oligopoly in wireless mobile service.
It will be interesting to follow up on this later. It seems that most iPhone users have AT&T or Verizon, so it would be interesting to see what would happen if Apple did enter into providing service. Would they lose their contracts that provide Apple products to other service providers? Could you no longer have an iPhone through Verizon?
Apple and Google each possess a strong economic moat; Google's interest in this area is not surprising. I do not think that this will impact Verizon much due to its wide-spread service areas. In many rural areas Verizon is the only feasible provider. Additionally, how long will it take for Google to gain a sufficient market share? The two-year nature of many phone contracts will bind customers to their current provider for a while.
This is a smart play by google. Although I do not believe google has enough economic clout to capture a huge percentage of the market from carriers such as Verizon and AT&T I believe they will be an excellent alternative for those who believe in their product. This will also give google a platform to start selling devices on and possibly a new revenue stream for the aging company.
I am wondering how the government will react. If it happens in command economy like China, the government will absolutely ban it.
I think this is a very interesting move by Google. They are trying to expand into other markets and gain a bigger customer base. I believe that Apple will make a move in this market as well and could potentially make a deal with Verizon and AT&T. It will be interesting to see how this move will affect the market share among the companies in this field. Also, I wonder what this move will do to the smaller mobile service carriers such as Cricket mobile; and whether they will continue to be a competitor in this market. Another thought is, could this move eventually expand into a global mobile communications service which could facilitate international methods of mobile communication between foreign countries?
This is an interesting, but not unprecedented, play by Google. Previously, Google has attempted to make in-roads into the data services market through its fiber optic program, offering 100MBPS speeds through fiber in an attempt to displace SMB cable packages at competitive rates. Although not cellular, it may represent Google's willingness to shift into markets where it has some experience and credibility, given its data handling operations. It's not unsurprising that Google has decided against installing its own, independent infrastructure -- such costs would likely doom the project from the start and expose Google to a great amount of risk.
I'm not certain that Apple or Microsoft will follow the same path. Apple occupies a well-paying position in the markets in which it currently plays. A foray into the array of wireless carriers would not afford it any sort of market dominance and would expose Apple to the side of the mobile industry with which it has relatively little experience. It would further expose Apple to potentially unwelcome customer service problems and carrier confusion. It occupies a cozy position with its current carriers given its first position sponsorship with several major networks in device distribution. I personally believe that Apple making a foray into the carrier market would be wholly unprecedented and contrary to its previous corporate strategies, especially given the timing, pacing, and nature of its previous divisional expansions.
I think sharing markets is a great way to improve efficiency, so this move, if actually comes into play, will be good for consumers.
I agree that this move could result in improved efficiency but it could also lead to a monopoly like situation, especially if Apple also follows suit.
Never the less, it'll be really interesting to see if this works out for Google and if Apple will also come up with a similar idea
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