GigaOM

Thanks for the analysis. As a Verizon customer, I find myself completely cynical about anything they do benefiting me in any way.

[...] advantage for companies in relatively mature markets such as mobile. That said, Om Malik seems somewhat skeptical of Verizon’s motives, and says open access could prove to be [...]

They are way off of they think they are “open” but at least the dinosaurs are thinking the right way.

Om,
What about applications/deck? If the so called ‘open’ approach results in uncontrolled, open decks for apps, users benefit. As for #4 above (pipes-r-us), I am highly skeptical that VZ (or ATT) seriously think they will be content with selling pipes and not trying to control the high $ bits flowing through the pipes.

Om, Perhaps I’m missing something, but isn’t Verizon (and Sprint) entire network “All CDMA”? How could they possibly support GSM phones, open or otherwise, without equipment upgrades?

Perception is reality. People perceived Verizon to be more closed than ever and Verizon got a beating for that all the time. Looks like they want to start atleast by changing their image. That is a plus for all. I am glad to know Verizon is realizing it has to change.

Even after it’s “open”… it’s still CLOSED!

In other words, CDMA is such the minority, that what they’re really saying is:

1. Sprint customers, C’mon over! you can keep your handset.

2. Nokia, et all - please don’t abandon CDMA and make some cool phones for us.

3. Oh, OK - want to leave our “open” network? Your only choice is Sprint. We’ll take our chances that this will be a minority decision vs. the other way around.

Now… if AT&T follows suit, then it would be more interesting.

I’ll give the benefit of doubt. They are being proactive and becoming a wireless ISP. Phone plans will go away in the future of 4G. It will all be data (or ISP) plans.

Another interesting twist is the recent acquisition of Firethorn (mobile banking) by Qualcomm for $210 million. Qualcomm is branching out into new services with presumably tight integration into their chipset. That may (will?) make it harder to provide new stand alone apps that are competitive on CDMA networks. That being said, I think this announcement is the tipping point and whether Android crushes Verizon as a platform doesn’t really matter. New apps and devices are coming and this just increases the stakes.

If you’re complaining about the CDMA limitation, you don’t understand wireless networks. Besides, multi-mode handsets are now becoming available and this decision could provide incentive for more options. I have a BB8830 “world phone” which has CDMA and GSM radios built-in. I could theoretically use it on an open CDMA network or an open GSM network.

OK, now I’m going to return to my fantasy world involving world peace and Swedish Bikini Models… ;-)

Re: your point regarding qualcomm. I think you are missing the forest for the trees here.

They make the same kind of money for 3G phones, whether it is in Cingular or Verizon. Both 3G systems are CDMA based. Both 3G standards are not “open”
… they are tightly controlled by industry bodies 3GPP and 3GPP2. The same will be the case for 4G systems. Qualcomm is just a small part of the equation. You can also make the argument that Qualcomm has helped smaller device providers vis-a-vis the biggies such as Nokia. So, it is really a stretch to say the GSM is “open” in any way.

Verizon has already decided to move to LTE, the post-GSM, post-WCDMA path of 3GPP from the Qualcomm dominated 3GPP2 (Verizon currently has EV-DO from 3GPP2). If you analyze the change within this context, you can make the argument that this change was coming. I am certainly surprised that it happened right now. But, just like you, it is hard not to listen to my inner cynic.

[...] Techcrunch and GigaOM weigh in on the issue. A lot can happen in a year, and GigaOM is correct to be [...]

Looks like Verizon wants to be Facebook of telcos :)
If Verizon delivers what it has promised, then every one is to gain.

Open network mean more interesting/useful applications and hence more (happy?) users!

Its hard to visualize a truly open telecom/wireless service provider. OM, can you site an example of this happening anywhere else in the world. Who has opened the “network” to 3rd parties. One application i.e. SMS can be seen as an open(or not so open)access to the cell networks. Apart from that I don’t think much exists today. If Verizon thinks, they can become Google of network provider world, then I have my doubts. Simply opening the network does not mean “Open”. They still have to provision $25 chinese devices and monitor/bill usage. Are they changing that? Are they going to have open software APIs to do all that? If yes then they have lot to prove. To me, its a struggle with innovation that Verizon can’t keep. That is why they are asking 3rd party developers and CDMA phone manufacturers to come forward.

Om,

Thanks for the analysis. I agree that the rationale behind the move is pretty transparent: the 700 mhz auction. But for VZ, the ends would certainly justify the means if this gets them MFN status and they acquire the bandwidth.

[...] the details aside for a second - and really think about it from an economic point of [...]

I think Verizon is slowly trying to drift from Qualcomm’s CDMA and BREW monopolies. First of all, they announced some time ago that they would go with LTE instead of Qualcomm’s UMB for a future network upgrade (both LTE and UMB are OFDMA-based, so Qualcomm should get some royalties from both), which should start around 2010 (AT&T also will go with LTE). And now they announce the open access initiative that is going to hurt Qualcomm’s tightly controlled BREW application platform. BTW, it will be a smart move for AT&T to join OHA/ Android folks to single out Verizon.

[...] far, the blogosphere is cautiously optimistic. Om Malik, Harold Feld, Public Knowledge - they’re all weighing in. There’s some suspicion, [...]

[...] more, see Om’s pithy take. Google GDrive is real, almost here – Rumors have abounded around the blogosphere for years [...]

My gut feeling says it’s all part of the PR stunt. Looks to me this has something to do with the upcoming 700mz auction. Why in the hell would Verizon want to be a dumb pipe? In addition, open API’s access for third party developer coming from an operator is something way too much to digest. I guess off late I’m hearing only open,open,open..
All that said, if they can deliver what has been promised, then it’s a great initiative and a leap forward towards open operator network. Wow, its going to be a huge opportunity for independent developers and small startups. I would definitely tread the path cautiously.
Iam still wondering how are startups approaching this whole new arena of open platforms. Maybe, somebody should build a OpenCarrier platform that shall play the role of OpenSocial of carrier network. Boy, this is way to much to dream.

Is open network equal to open systems? Sadly I remember the 80’s, or define open.

Its good to see something happening on those lines in US as a starting point.
I wonder if companies like telstra start to think on these lines here in Australia.

[...] Verizon’s announcement today however you want: an about-face, a shocking surprise, a concession to Google and the Powers-That-Be. But the No. 2 U.S. carrier [...]

[...] course Verizon’s move isn’t just about the iPhone — Om details the other factors (and is rightly skeptical — there’s probably a lot more drama to unfold).  But this [...]

Are you all aware of how much the average consumer contacts their cell service provider? From what I’ve seen, they will contact them for almost any reason, for the most trivial of issues. It doesn’t even have to be something related to the carrier’s service (e.g. my PC’s bluetooth radio doesn’t have a Com port profile for file transfer). These types of high-touch customer eat away at the carriers profits. A support-free plan doesn’t have to mean crap service. Not that I believe Verizon is acting in earnest here, just saying…

[...] announced today that they are going ‘open.’ Om has a good post on this. Here are the high level implications: 1. A phone with Wi-Fi doesn’t need approval from [...]

I dont know how open it will be, But as long as I am not subjected to that bland hideous red UI that Verizon insists all (okay not all but most of) its phones have, I am happy …

don’t forget about xohm: http://gigaom.com/2007/10/29/sprint-xohm/

[...] any application - check out this Yahoo! News Strory. on what it means to the business of carriers, gigaom has an article. he argues that this is an opportunistic move in relation to 700MHz auction, and might have serious [...]

Om,
Great post and thanks for the analysis.

I think they are now recognizing a shift in customer preference…

http://tinyurl.com/3c9fhd

[...] Kevin J. Martin. Bloggers who follow the mobile industry like Carlo Longino at MobHappy and Om Malik seem more skeptical. Will Verizon really become an open network or is it all politics and PR? Leave [...]

[...] spinto Verizon Wireless ad operare una tale scelta, e nonostante alcuni scetticismi (vedere ancora GigaOM), è indubbio che il peso di Android e della Open Handset Alliance comincia a farsi sentire. 2837 [...]

[...] Verizon Wireless Plans to Open Its Network. This could be exciting though its level of ambition makes me dubious as to whether Verizon can pull it off. (tags: mobile news wireless verizon) [...]

[...] Why Verizon  Went Open & What It Means (GigaOM) [...]

[...] Om Malik consults his “inner cynic” and finds these [...]

[...] banda de los 700 MHz que se va a subastar en Enero en Estados Unidos. Sin embargo, como bien dice Om Malik en una brillante reflexión hay que ser un poco escépticos hasta saber más [...]

What is verizon? Check out my blog at http://www.extrapreneur.wordpress.com

[...] device manufacturers to get onto its network, it could end up tripping over its own feet.”GigaOm’s Om Malik: “Do we really believe that Verizon is going to be happy being [...]

Anyone paying attention to technology would realize that Verizon is already slowly being turned into a dumb pipe. With its internet access business model and its usb mobile modem, I can already sidestep their phone business model using my laptop and an internet based phone company. If GOOGLE buys that bandwidth at auction and does as it promised, then an open network would go even further into taking a bite out of Verizon phone business model. Perhaps Verizon is trying to position itself for this happenstance by “going with the flow?” Its attempt to charge content owners more money is charging the public against them, so they either play ball or find themselves another line of work.

[...] For a more cynical view and good analysis on what’s really going on behind Verizon’s announcement, check out Om Malik’s piece here. [...]

“Press call didn’t clarify how much network access will cost. They currently charge $60 for plain vanilla wireless broadband access. From a network perspective, this could be expensive.”: I keep seeing this $60 figure. That’s incorrect. $60 is the two-year contracted plan which often requires a voice plan of $40 or more along with it.

Verizon, AT&T, and Sprint Nextel all charge $80 per month (as does Clearwire) for a non-contract “unlimited” service plan on EVDO or HSPA.

Seems to me that Verizon is prepping a nice cushy landing spot for all the new Google-Android phones under development.

Om:

Can you give a few reasons that Verizon might be doing this as opposed to a different company? If there’s profit to be made, why haven’t others beaten them to the punch? Obviously, their move to open their networks is not something to be taken lightly, and much analysis and boardroom scuffling must have preceeded such a risky venture. I’d be interested to hear what a fly on the wall would tell of the battles waged during the discussions of why, or why not.

Anthony

[...] Why Verizon Went Open & What It Means (tags: blog cdma mobile news verizon wireless verizonwireless iphone apple digitalmedia) [...]

[...] Hopefully we can count on competitive dynamics to make such pricing issues short lived.  Om Malik predicts it will open the market up to cheap Chinese handsets, for example.  Details of the exact business [...]

[...] Malik of GigaOM opines that: …it wants developers to write applications to their platform. Seems like they [...]

[...] Wolf in sheep’s clothing [...]

[...] Why Verizon Went Open & What It Means - GigaOM (tags: verizon telecom) [...]

[...] applaud loud and clear when companies are “open”, just look at the reaction Verizon is getting from yesterday’s announcement. Google Open Social….yippeee; Open API…yeah; Open [...]

[...] be a while before we see the actual 4G network rolled out. This technology evolution when complete will make Verizon’s Open Development initiative more meaningful. The LTE evolution negates the GSM vs CDMA debate, and it also promises global connectivity. In a [...]

[...] also chimed in on Verizon’s announcement this week that they’d be opening their network to a degree, calling the announcement “overblown.” “The industry’s headed [...]

Count me in with the cynics. Verizon might be gambling that this announcement might motivate Google to drop out of the 700 MHz auctions, which are planned for January. After the auctions, Verizon could easily backpedal by retracting their network opening announcement.

Goggle withdrawing from the auctions benefits Verizon by removing a deep-pocketed bidder thus possibly lowering the ultimate prices paid for spectrum.

In other words, this announcement by Verizon is just a ploy, negotiation by other means. For the price of a press release Verizon might succeed in lowering their costs to acquire new spectrum and also eliminate a competitor.

Until this announcement is followed by tangible, irreversible action by Verizon, no other motivation should be assumed.

Since posting my own “VZ opens” commentary, I have noticed a fair amount of discussion at the technology and standards level…like CDMA vs. GSM vs. WiX and how closed centralized networks can or maybe not go open overnight. All valid arguments. But, the more I think about it, the real question is whether you can change the closed culture and DNA of an organization overnight. The real winner is the open movement. Tactical defensive move. Getting ready to position for eventual outcome of 700 MHz. bid.

Kameran Ahari
http://gotastrategy.typepad.com

[...] Wednesday’s wireless announcement from Verizon Wireless spawned a huge discussion amongst social media-ites on how this stacks up with Google’s Android initiative. Today, Google’s decision to bid on a wireless WiMax license became public, so this discussion will really take off.  Cisco has already indicated sincere interest in a 700 MHZ, and there are rumblings that Apple wants one, too. [...]

[...] Om’s feedback on Verizon opening up it’s network. I remember first hearing of the details of BREW and freaking out.  This was another inevitable move.  Closed is so - like yesterday.   Scoble thinks Verizon kneecapped Google. [...]

[...] sexta edição, exploramos um pouco o mercado de telecomunicações (1, 2, 3), o resultado de uma semana de Kindle e continuamos a falar mal da Microsoft, como esperado. [...]

[...] by Daniel Berninger, Tuesday, December 4, 2007 at 4:30 AM PT Comments (0) Consider the recently unveiled “any app, any device” initiative by Verizon Wireless in the context of the company’s [...]

[...] push for Open standards in the FCC auction is forcing Verizon to go down this path. Many are still skeptical about them delivering a true open environment. However I consider this as one of the final nails in [...]

[...] by Om Malik, Thursday, December 6, 2007 at 8:41 AM PT Comments (0) Ever since Verizon announced that it was going “open,” OPEN has become the new buzzword. For instance, this morning [...]

[...] Pros and Cons Of “Open” Verizon - Perhaps the most surprising news this week is the decision by Verizon Wireless–one of the old-guard cellular carriers–to open its network and platform to third-party handset makers and software developers. From a pessimist’s perspective, Verizon decided to do this because it doesn’t want to make open network concessions at the upcoming 700 MHz FCC auction. Opening up now means the company would be able to say “we’re already open,” even though third parties would be forced to use the telecom’s proprietary software development kit to create and run programs on its CDMA-based network. [...]

[...] its developer kit for the iPhone; Sprint Nextel launching its WiMAX business, XOHM; Verizon Wireless saying it will open up its network and platform; Google’s efforts around Android and a possible gPhone; and the 700 MHz auction. The two massive [...]

[...] share some of Om’s cynicism, but regardless of Verizon’s motives and intentions, Verizon seems to realize at least to [...]

[...] Tuesday, January 22, 2008 at 11:33 AM PT Comments (2) Two months after saying it would open up its network to other devices, Verizon Wireless is inviting developers to a mid-March conference [...]

[...] Those who were closed declaring themselves open [...]

[...] which will open up their network to third party products. Great news! Except that their network only supports CDMA devices, and most cool phones (read: iPhone) are GSM. Oh, and the whole thing might only be a ploy to [...]