Is the Voice-Messaging-Data Plan Paradigm Beginning to End?
You buy a new smartphone because you want to use it to download apps and run cool Web services like video calling and streaming video. So you buy a data plan. Fine. But why are you forced to buy service for text messages and voice minutes too?
Tue, October 25, 2011
PC World — You buy a new smartphone because you want to use it to download apps and run cool Web services like video calling and streaming video. So you buy a data plan. Fine. But why are you forced to buy service for text messages and voice minutes too?
Its well-known that traditional text messaging costs the carrier literally nothing, yet you have to pay for them. As for voice calling, maybe youd rather rely on a Web-based service like mobile Skype or Google Talk, and avoid voice charges altogether.
If the future of cellular phones is really about apps and Web-based services, why is a large part of your wireless bill still dedicated to voice minutes and text messages?
Well, at last, theres an alternative to the tyranny of the bundle. For those who would rather use Facebook or Skype to communicate and don't want to pay for talking or texting services they hardly use, hope may be coming in some new pricing plans such as one recently introduced by T-Mobile and Walmart that provides cell phone users with 5GB of high-speed data and only 100 minutes of voice for just $30 per month, with no long-term contract needed.
Voice and text messaging services are still hugely profitable for the wireless carriers, and as such are likely to remain an expensive component of cellular plans for the near future, especially from the three main service providers in the United States--AT&T Mobility, Verizon Wireless, and Sprint Nextel.
But will plans like that offered by T-Mobile and Walmart be the first cracks in the dam?
Is Bandwidth Arbitrage Possible? Maybe
The idea of a world where providers would offer data-centric plans and compete to provide the most bits per buck--a sort of "bandwidth arbitrage" scenario--was floated as a potential "big deal" by Sanford Bernstein analyst Craig Moffett in a note to clients sent out after the T-Mobile/Walmart announcement.
Technically, it's no surprise that the cash cows of voice minutes and text messaging are being targeted from multiple endpoints. Apple, for one, is baking its own instant-messaging app, iMessage, into the latest versions of its iPhone software, giving iPhone users a way to circumvent the message plans from providers when communicating with other Apple devices. And BlackBerry users have long had their own messaging system.
Microsoft's recent $8.5 billion acquisition of Voice over IP provider Skype is an indication that pressure may also be building on the voice-minutes horizon. Though Skype is not yet in widespread use by most cell phone users, Skype's August acquisition of group-messaging provider GroupMe seems to be a sign that in the future, traditional voice-based communications as well as video communications will be handled via the data stream.
