By Noah Graff
Today’s Machining World Archive Volume 4 Issue 05
Americans have quickly become accustomed to free Internet services from Google and Yahoo! and access to free newspapers on the Web, all funded by advertising. Cell phone service providers AT&T Inc., Verizon Wireless, and T-Mobile U.S.A. all recently began offering unlimited call time for around $100.00 per month.
In 5 years will cell phone service in the United States be free?
One of the big trends in mobile communications, especially with young people, is the shift away from voice to IM and text messaging. At least with this generation, voice is the secondary form of communication between them and their friends. At the same time, voice itself has started taking a back seat to data, especially in smart phones where email, text messaging and wireless Web access are becoming the primary applications on these devices.
However, voice is not completely going away any time soon. It will always be a form of communication on phones. But it will come bundled with many more applications and data services, and in essence, within five years, it will just be part of your service plan. Since voice usage is scaled back, it might look like it is free, but it will be included in the price of wireless mobile data and applications.
Tim Bajarin
President
Creative Strategies, Inc.
My answer is no, cell phone service will not be free in five years. Why would we believe that wireless services would be free when wired services are not? It costs billions of dollars to build and operate wireless networks and the amount of bandwidth available is both limited and must be shared between all wireless customers. There might be a transition to a combination of paid and advertising support networks but it will have only just started in five years. We will continue to pay a premium for wireless voice and data services over wired services because of the costs associated with the radio spectrum and the building and operation of the networks. Those who think that access to the Internet is free, therefore all communications are free, are only kidding themselves.
Andy Seybold
Wireless Technology Consultant
Andrew Seybold, Inc
No, but it’ll be a whole lot cheaper because:
1. Competition: So many people who need cell phones already have them, so at this point the carriers have to steal customers from each other – that will continue to drive prices down.
2. Technology: It’s reducing the cost per call. And new technology on the horizon will allow people to use their cell phones at home and carry the call over their home’s broadband network.
These “femtocells” will reduce carriers’ costs, ultimately yielding reduced charges for subscribers.
3. Data: The last frontier for carriers to raise revenues is data; web browsing, text messaging, mobile TV, etc. These services are highly profitable – carriers will likely reduce voice costs to entice people into using their data services.
In the meantime, users should be happy that they don’t have to purchase their service in Europe; it’s about double the cost we pay here.
Scott Goldman
Consultant
“The Wireless Wizard”
The Facts
It can cost anywhere between $500,000-$1,000,000 or more to build a cell site and carriers have hundreds, sometimes thou-sands of them, in metropolitan areas.
The cost to obtain a new “subscriber” can be as much as $800 for a carrier when expenses such as marketing, additional personnel and subsidization are factored in. Carriers don’t start making money until subscribers are well into their second year of service. Scott Goldman
www.thewirelesswizard.com
In the 1800s San Francisco saloons offered a gratis meal to any-one who ordered at least one beer. Recently rock icons, such as Radio Head and Trent Reznor of Nine Inch Nails, gave away their new albums for free. On the Internet, people take for granted services such as search (processing power), unlimited storage on Gmail and Yahoo! Mail, and bandwidth on YouTube.
Wired Magazine 16.03 “Free! Why $0.00 Is the Future of Business”
Wall Street analysts speculate that Sprint Nextel Corp. will soon undercut competitors, offering unlimited talk time for as low as $60 dollars a month.
The Pew Internet & American Life Project found in a survey that 73 percent of U.S. adults own a cell phone, 68 percent have a desktop computer, 30 percent possess a laptop, and 73 percent connect to the Internet. Thirty seven percent regularly use instant messaging, and 41 percent have sent a text message from a cell phone.
cnetnews.com
