Monthly Archives: February 2011

Today’s motion is that Software SIMs are a good idea.

Peter says that Software SIMs are a good idea

If you’re running a smartphone, then the chances are you’re at the mercy of your local mobile network operator – firms like Vodafone, O2, Orange, Verizon or AT&T, depending on what continent you’re on.

Do you like them?  Most of us don’t.  Sky-high charges and lengthy contract periods abound.  Firmware releases are delayed for months so that operators can customise them with badly designed add-on UIs and disposable, buggy, branded software designed to generate extra revenues for carrier and their partners.  Some even force manufacturers to disable key functionality such as GPS, Wi-Fi, tethering and hostpots, just so they can wring a few extra pounds or dollars from us in data charges or subscription services.

It’s a familiar story, and we let the misery continue because we haven’t got much choice; they hold all the cards.  Typically, the relationship between the consumer and the mobile network is a direct one, with hardware manufacturers like Palm, Samsung or HTC forced to kow-tow to the operators because they are the real customer for their handsets, not us. The traditional approach to distributing and activating mobile devices has remained essentially the same for 20 years.

It’s high time that someone picked a fight with carriers and knocked them down a peg or two.  Love them or loathe them, the only company that can feasibly stand up to the network operators is Apple.  Who else is going to do it?  Not Google.  They tried and failed with the Nexus One.  HP?  No market share and therefore no clout.  Nokia?  Give me a break!  Nokia is making sweet love to carriers, desperate to get them on board for their pending Windows Phone 7 launch.

Only Apple has stood up to operator pressure and won; the iPhone is completely free of carrier customisations, either in hardware or software.   Refusal to compromise on this kept the iPhone off Verizon for three years and right up until the moment of launch, tech bloggers wondered who had blinked first in this corporate staring contest; Apple or Verizon.  The answer?  Verizon.  The iPhone has proved to be a game-changer for mobile networks.  Consumers will even move to networks they dislike, just to get it.  It’s a bigger brand than the carriers, and they know it.

Steve Jobs has memorably described the mobile operators as “dumb pipes”, supplying commoditised network connectivity and little else.  The ultimate expression of that wish will be the elimination of SIM cards, not just for iPhones, but for all smartphones.  Apple has been working with GSMA and SIM card manufacturer Gemalto to make this market disruption reality.  And it would be a standard – not an Apple-only initiative that locked you to an iPhone.

If your primary relationship was with the hardware manufacturer, whether it was Apple, HTC, Samsung or Nokia, all the operators would have to compete on price and quality of service.  Charges would fall.  Services would improve.  That’s what competition brings.  Firmware releases would all go out at the same time and the feature-set of your phone would be dictated by the manufacturer, not restricted by the carrier.  Players like Verizon would have no say over the branding and customisation of the handset.  No more ‘crapware’.  Imagine travelling the world without having to obtain a unique SIM card for each carrier in a each country.

And, of course, you’d be able to switch to other SIM-free phones, enabling your operator account on them when you moved or buying a block of service from your handset’s App Store.  Sure, you’d have to buy the handset up front, but it would be unlocked and the network service would be an order of magnitude cheaper to compensate.

This sounds pretty good, doesn’t it?  Not to the operators, who would be marginalised.  Last November, European carriers demoted the marketing of the iPhone and iPad on their websites and threatened to drop subsidies completely if Apple didn’t back down on this.  They did, for now – if the carriers followed through on their threats, iPhone sales would have taken an estimated 12% global hit.  If you didn’t already think that the mobile network operators were too powerful, then this kind of intimidation tells you all you need to know.

Software SIMs are liberating for consumers and a nightmare for carriers.  If you too would like to see the current comfy status quo shattered, please support this motion!

Shaun says that Software SIMs are a bad idea

Mobile operators have too much power. That is a view commonly shared and one that holds weight when you consider that they control network access, the price of your tariff and many other aspects of your mobile life. One solution to this problem is the SoftSIM which Apple, amongst others, has put forward. I completely disagree with the idea for many reasons and hope that it does not come to fruition anytime soon.

I get the ‘small’ advantages that Software SIMs offer, but they are nothing compared to the potential disadvantages. Currently network operators have to compete with each other on coverage, voice quality, data speed, customer service, price and a myriad of other factors. To use SoftSIMs would potentially lessen the areas in which they need to compete, or more likely cause them to not try so hard. The huge competition in some markets, particularly in the UK, causes them to do everything they can to grab customers from other networks and the range of handsets and pricing are major factors. Do you really want network providers removed from the retail game?

The view is that traditional SIMs lock in customers. That’s true. Go and buy a smartphone with a Software SIM and sign up to a 24 month contract. You are still locked in. The difference is that if your phone breaks you can put a hard SIM in another phone. Try doing that with a Software SIM. You are completely reliant on a piece of hardware for your telecoms and your flexibility is limited. You may well be able to move to another phone, but all of your current phones have hardware SIMs so what happens then?

All Software SIMs do is give the power to hardware manufacturers and whoever they decide to partner with to supply the options. Hardware manufacturers have to compete on features, reliability and other aspects, and that should be all. There needs to be a line drawn so that network operators and hardware manufacturers both have to compete in their specific areas because we, the customers, benefit that way.

Also, say you want to take your phone abroad and use data. You currently have options to pop in a PAYG SIM from another provider if your phone is unlocked. Will there be a facility to turn your current number off and use another provider in this instance? Even if there is, how will you get calls to your current number?

Apple came into the European market with the iPhone and dictated pricing, availability and managed to take some of the power away from the carriers, and we all suffered. Whether you realise it or not, the power is much better sitting with network providers who have to fight incredibly hard to keep their portion of the market anyway. Taking away the power to dictate pricing will take away their ability to compete and ultimately take away so much revenue that the services we need so much now, the data network, will not have enough capital available to it to grow. At any time the power can shift in hardware and Software SIMs would, at that time, become extremely problematic.

Please take a moment to vote in the poll below- the result will be published tomorrow.