• MOST READ

• LATEST NEWS

European operators have never been as pliant around Apple as AT&T, and they are angry with the iPhone maker again, this time over its plans to sideline them by introducing a SIM card that can be activated by the user, for any network.

Some - notably major international players Vodafone, Orange and Telefonica/O2 - are threatening to refuse to cut iPhone subsidies if Apple persists with its plan, reports the UK Financial Times. Like Google before it, Apple may find itself out of step with the market if it pushes too hard towards open access by letting users choose their carrier at the point of purchase - as Google attempted with its online store for its Nexus One phone.

Carriers know that the main problem with such models is that most consumers are still lured by a hefty subsidy, and are unwilling to pay $500 or more upfront for a phone - and in Europe, even high end handsets are often completely 'free' with sufficiently large data contracts. So the cellcos' threat would be a serious one. At stake for them is a system that reduces their role in the value chain, weakens their relationship with the consumer, and increases churn and reduces contract lock-in by making it easier to move between operators.

Global iPhone sales could fall by up to 12% if European operators refused to subsidize purchases, according to analyst firm Bernstein.

Although Apple has not publicly announced the SIM project, it has been widely reported to be working on the smart embedded SIMs with smartcard firm Gemalto. The cards would be similar to those recently proposed by the GSM Association as the way forward for non-phone (and unsubsidized) embedded devices such as smart meters, though by supporting that GSMA initiative, carriers are weakening their case for keeping a tight hold on handset SIMs. If Apple goes ahead, its new scheme would come first to Europe, since it has less relevance in the US, where only the two GSM carriers use SIM cards.

Related Stories

COMMENTS

No comments yet. Be the first to add a comment!

Carrier Broadband Performance: Africa & Middle East
Carriers are using mobile broadband as their weapon of choice in the fight against the commoditization of voice and falling ARPU. This...

Voice over LTE: Market Analysis and Forecasts
VoLTE offer unique advantages in lowering a carrier's voice infrastructure economics and promises to improve voice quality, device...