[undone]

Another Reason Carriers Hate to Love Apple (AAPL, VZ)

As if wireless carriers didn't already have mixed feelings about Apple's (Nasdaq: AAPL ) iPhone, we can now add another item to the "con" side of the table.

Recent figures from network researcher Arieso claim that Cupertino's latest and greatest iPhone 4S is a bona fide data hog. Users of the gadget consume nearly twice the amount of data as those using its predecessor, the iPhone 4, and three times as much data as the iPhone 3GS. Arieso is quick to pin the blame on Apple's Siri virtual assistant, which is exclusively available on the newest model.

Since Siri needs a network connection to function, it's easy to jump to the conclusion that it's the culprit behind the data hogging. On the other hand, Ars Technica did a study when it first got its hands on Siri and found that even if you used it up to 15 times per day, you'd consume roughly an extra 28 MB of data per month. While results will vary, that's still pretty low, and unlikely to double anyone's usage, but Arieso's methodology certainly differs.

The company also compared the iPhone 4S to Google (Nasdaq: GOOG ) Android devices that eat up data at a similar pace, which calls into question the allegation that Siri is responsible. The Android-powered HTC Desire S ranked in lockstep with the iPhone 4S uploads and the Samsung Galaxy S was comparable in downloads.

According to the report, only two smartphone makers are "network friendly": Research In Motion (Nasdaq: RIMM ) and Nokia (NYSE: NOK ) . BlackBerry users tend to use about a fifth of their iPhone 4S counterparts, partly due to RIM's data compression and the fact that its users seldom stray beyond email.

The figures highlight the need for carriers to continue aggressively investing in their network infrastructures to cope with soaring data demand, and is another reason why the iPhone is a mixed blessing for carriers. For example, Verizon (NYSE: VZ ) recently announced that it sold 4.2 million iPhones on its network last quarter, which will hurt margins due to the heavy subsidies Apple garners. Its wireless margins are expected to take a whopping 5% hit in the quarter.

Tensions abound between Apple and carriers. Apple is the gatekeeper over what apps suck data through their networks. Carriers drool over the subscriber numbers the iPhone brings in. Apple undercuts their pure-profit SMS plans with free iMessage. Carriers have to pay 40% more in subsidies for the iPhone compared to other devices, while having to spend billions to beef up their networks. The list goes on.

Data gobbling is just another reason why carriers hate to love Apple, although I doubt it's Siri's fault.

[sleepngbear]

Ha ... that figures. Carriers love all the new subscribers but hate having to actually support them. :/

Seems like just a bit of Apple-bashing here; if data usage were really that much of an issue, you'd think the carriers would push the more data-efficient BlackBerry's ... or at least not hide them in some obscure corner of their retail stores.

[1812dave]

when push comes to shove, carriers will go with whatever entices consumers to their service. The carriers will work with whatever issues arise from such products' usage. ie, it's not about the "tech"; it's about SALES.

[undone]

when push comes to shove, carriers will go with whatever entices consumers to their service. The carriers will work with whatever issues arise from such products' usage. ie, it's not about the "tech"; it's about SALES.

I'd say its more about the cost of doing business (successfully/profitable). That's why its not surprising to see the unlimited plans go the way of the dodo. Blackberry users should get a discount.

[1812dave]

I'd say its more about the cost of doing business (successfully/profitable). That's why its not surprising to see the unlimited plans go the way of the dodo. Blackberry users should get a discount.

I have unlimited. Having said that, for grins I checked my data usage today. I'm just over 2GB, 21 days into my month. I use the daylights out my Bionic and had expected that usage would be around 10GB a month. If I didn't have unlimited, I'd probably opt for either a 2GB or whatever the next amount is and keep an eye on usage as I hate wasting money. It sure beats the heck out of using my old Storm which wasn't good for much of anything but phone calls and BBM.

[BBBrooklynFAN]

That article is factually backwards and backward looking, just like RIM.

“One of the main reasons RIM missed the mark with the browser was because
they were always proud of how little data usage a user would use,” a former executive said. “There was no three-year plan at RIM.” RIM would be proud of the fact that someone would only use 1MB of data in a month in 2005, and as a result, there wasn’t ever any extensive R&D done within the browser space. Over time, that misstep affected BlackBerry tremendously as competing devices began to deliver desktop-like Web experiences. “Mike Lazaridis couldn’t imagine that consumers would be spending hours watching and streaming video to their devices, he couldn’t understand it,” the former exec continued. This is why we don’t see RIM excelling in spaces like camera technology, or displays — because the company never even attempted to anticipate the smartphone trends we’re seeing today. “RIM is a reactionary company.”

[BBOttawa]

I agree the article is wrong, and the fact that the iPhone 4s uses more data is a good thing for Apple, as then the carriers can charge consumers for more expensive data plans. The carriers want people to use more data, they make lots of money off it.

The fact that BB is so efficient is good for the consumer, but bad for the carriers, so they have no interest in pushing those devices that can get by on a 500mb plan like I have for my 9900 is not good for my carrier who wants me to upgrade to a more expensive plan.

RIM should disable all web browsing going through their NOC with OS10 phones, and only push email and BBM through it.

[grover5]

I have unlimited. Having said that, for grins I checked my data usage today. I'm just over 2GB, 21 days into my month. I use the daylights out my Bionic and had expected that usage would be around 10GB a month. If I didn't have unlimited, I'd probably opt for either a 2GB or whatever the next amount is and keep an eye on usage as I hate wasting money. It sure beats the heck out of using my old Storm which wasn't good for much of anything but phone calls and BBM.

I'm just curious, do you use wifi much or are you always on the cell network?

[Economist101]

I agree the article is wrong, and the fact that the iPhone 4s uses more data is a good thing for Apple, as then the carriers can charge consumers for more expensive data plans. The carriers want people to use more data, they make lots of money off it.

Actually what they really want is for you to pay for more than you actually use, hence the tiered plans. If it was just a matter of "more data, more revenue" they would charge by the MB.

RIM should disable all web browsing going through their NOC with OS10 phones, and only push email and BBM through it.

You're right. BB users wouldn't even notice the absence of web browsing.

[BBOttawa]

Actually what they really want is for you to pay for more than you actually use, hence the tiered plans. If it was just a matter of "more data, more revenue" they would charge by the MB.

They know exactly how to maximize profits, sell phones that chug down huge amounts of data, as they know they can't actually charge purely for each MB, as people would then care about how much they use and ration their use, and/or choose phones that are more efficient. They've worked it all out, it helps them to sell phones that are data hogs, not efficient phones.

You're right. BB users wouldn't even notice the absence of web browsing.

How is not going through the NOC mean an absence of web browsing? Every other phone just goes through the carrier to hit the web, I guess you're trying to be funny/put down RIM again, but it gets very tiresome to hear after a while. If you're spending your time putting down phone platforms you don't own on a board for a phone you don't own you're detracting from the conversation BB owners would like to have. Life is short, I would suggest everyone spend their time enjoying people, experiences, and things, not hating and putting down things. Just imho.

And yes I am saying the carriers are the wrong doers here, not Apple for creating a great phone that uses a ton of data, Apple is just being smart to not compress data, it just so happens that's what the carriers want, and the consumers have to pay for more data as a result.

[undone]

Older thread....but it was interesting to hear on Bloomberg yesterday 3/19/12 where an analyst that covers telcom specifically talk about how far over subscribed Verizon wireless data usage was based on there own original estimates. This can still be a big selling points to carriers, now if only RIM can leverage this as a selling point when they release there 4g devices.

[kyleheney]

Won't this whole iCloud thing just use more and more data? If I download something on my home pc/mac, it "automatically" goes to my phone and tablet... wouldn't that mean it automatically uses x amounts of data to do this? If I downloaded a few albums and wanted them on all my devices, wouldn't that mean I'm using a few hundred MB's of my data plan to do this?

Honestly, RIM's Bridge service is a much stronger selling point in my opinion. If a user had a 32GB memory card in their phone, they could store a ton of music and movies on it. Then, through a Bridge connection to their tablet (using Bluetooth aka ZERO data), the user could have "instant" or "automatic" access to their files on both devices. Now, this doesn't provide immediate access to the files on a home PC, however, the development of a PC Bridge client (much like how Print To Go installs a small file on your PC) could give similar functionality without using ANY additional data.

Doesn't this make a bit more sense? If something important needs to be downloaded, it would only need to use a data connection once. Subsequent times, it would use a Bluetooth Bridge connection to send it to other devices. This could only happen upon returning home (Bluetooth range isn't limitless like Cloud services are), but that may not be a huge issue for a lot of people.

[undone]

To expand your idea, smart syncing, choosing how it syncs. The BB Protect service allows you to pick when to backup (ie on wifi or cell).

[howarmat]

so do most things on apple and android. If you are concerned with data then there are generally options for "use on wifi only" type thing. I have unlimited LTE data so i never worry since its done fast and doesnt matter for my data usage.

[Sith_Apprentice]

Legacy plan there howarmat? lol. RIM needs to fully implement their cloud solution soon, and they have been working on it, just a matter of time. WiFI only is a good choice, but keep in mind Android and iOS users use significantly more data than a BlackBerry user. This can easily be a huge selling point for businesses that dont get the unlimited plans, and only get bucket of data per user.

[xandermac]

I started using Onavo, it cut my data by over 50% so far. Available for android and iOS. I'd be bothered by this if I were RIM. Yet another RIM tax selling point that's moot when carriers get this pre-installed on other devices.

[howarmat]

Legacy plan there howarmat? lol. RIM needs to fully implement their cloud solution soon, and they have been working on it, just a matter of time. WiFI only is a good choice, but keep in mind Android and iOS users use significantly more data than a BlackBerry user. This can easily be a huge selling point for businesses that dont get the unlimited plans, and only get bucket of data per user.

yes sir....been with VZW for almost 15 years now

[Superfly_FR]

Well, this is a huge debate for carriers ...
But for companies, as discussed before about wifi bandwidth saturation, the capability to rely on the (BES) NOC to compress is IMHO a real advantage ...

[Sith_Apprentice]

yes sir....been with VZW for almost 15 years now

10 years on AT&T. Legacy domestic unlimited, AND a legacy international unlimited

[BoldPreza]

I am quite happy to stay with my current 500MB plan. With my Torch 9860, even with all the surfing I do and app downloads in the last month that I have had it I barely hit 300MB's and that was all on the network, no Wifi.

[Economist101]

Won't this whole iCloud thing just use more and more data? If I download something on my home pc/mac, it "automatically" goes to my phone and tablet... wouldn't that mean it automatically uses x amounts of data to do this? If I downloaded a few albums and wanted them on all my devices, wouldn't that mean I'm using a few hundred MB's of my data plan to do this?

No, because what you described above is not the default behavior. By default, "automatic downloading" is off. Even if you enable it, it defaults to wi-fi only, unless you specifically enable cellular data usage for auto-downloading. Lastly, you can separately choose whether you want the auto downloading to apply to music, apps and/or books, and again, it is not enabled by default.

Honestly, RIM's Bridge service is a much stronger selling point in my opinion.

Empirical evidence (i.e. sales data) tells us consumers don't agree.

[Sith_Apprentice]

No, because what you described above is not the default behavior. By default, "automatic downloading" is off. Even if you enable it, it defaults to wi-fi only, unless you specifically enable cellular data usage for auto-downloading. Lastly, you can separately choose whether you want the auto downloading to apply to music, apps and/or books, and again, it is not enabled by default.



Empirical evidence (i.e. sales data) tells us consumers don't agree.

Bridge compared with iCloud type behavior? Not sure how many users bought the iPad specifically because of iCloud, or how many users purchased a Playbook because of Bridge. So sales data does definitely crush the scale in Apple's favor, but I doubt iCloud is a major factor there. (just as Bridge is likely not a major factor for RIM).