Verizon Wireless vs. David Pogue
If you haven’t been following the discussion (of sorts) between NY Times columnist David Pogue and Verizon Wireless CEO Lowell C. McAdam you’ve been missing a doozy.
Last week, Mr. Pogue wrote about US cellular carriers and the recent Senate hearings on cell phone exclusivity. David wanted to know why the number one cellular provider, Verizon Wireless doesn’t have a version of his favorite iPhone. David went on (and rightly so) to complain about the current US mobile phone/service pricing system.
Mr. McAdam took offense to the column. But instead of answering Mr. Pogue directly he sent his response to NY Times Chairman/Publisher Arthur Sulzberger. Aside from the implied threat (Verizon Wireless does advertise in the paper) McAdam escalated the situation to an unnecessary level.
David tried tackling problems some of the problems that US consumers have to face – including two different, non-compatible cellular systems (AT&T/T-Mobile use one technology while Verizon/Sprint use another), text messaging fees, calling charges and somewhat confusing low phone selling prices.
Mr. McAdam sent a response to the NY Times article but failed to answer many of David’s concerns. He told NYT’s publisher that his industry is one of this country’s financial successes during this economic downturn, said that Al Gore believes the industry is competitive and that 84-percent of Americans are satisfied with their current wireless service.
I spend a lot of time travelling overseas and I gotta tell you phone service there is 1000% better than in this country. Cell phones work on trains, subways, buses, elevators and basements. They work in big cities, small cities and rural towns. Everywhere. Other countries use just one cellular standard.
Overseas you pay only for the calls you make and messages you send (just like our old, home landline service). In the U.S. you pay for each and every call and message you send AND you receive. They call that “air time.”
And in other countries you buy the phone and the service separately. Phones there aren’t subsidized by fees in a monthly service charge. You can change your phone whenever you like – and own two, three or more phones. Your account is controlled by a tiny SIM card which is easily moved from one phone to another.
If you haven’t had the pleasure of walking past a cell phone store in London, Paris, Barcelona or any foreign city you wouldn’t believe the selection of handsets in the window. In comparison, our selection here is pitiful. There are some cell phones that never get picked-up by US carriers that are really terrific. US consumers are the ones who suffer.
There is no easy answer. The cell phone industry is now “maturing”. That means there are fewer first-time buyers and more repeat customers who expect some sort of incentive to re-sign. That means those carriers have to look for other ways to keep profits high: like charging more for text messaging, audio/video files, services and accessories.
On the other hand, with faster 4G data services on the way, US carriers have to find a way to pay for the rollout of all new equipment. Someone has to help pick-up the tab.
No one will win this battle. But you, the consumer will surely lose. As we progress to 4G (and beyond) the system could change to better serve consumers and carriers alike. Maybe not.