19 September 2007

iPhone in Europe

It has been announced that the iPhone will make its (official) European debut in the UK on the O2 network ... with Germany to follow (see this) on T-Mobile's networks. But questions remain about whether it will be as successful there as it was in the US. According to this article:

But analysts say Apple may have a tougher time in Europe. They expressed disappointment that the iPhone to be sold in Europe was identical to the one in the United States, meaning that it would be unable to take advantage of faster European wireless networks for Web browsing and media downloads.


Mr. Jobs said the iPhone would overcome this hurdle by relying heavily on Wi-Fi technology, which provides broadband Internet access for laptop computers and other devices, though only when they are stationary. When iPhones are on the move, they will shift to a mobile technology called Edge, which is also use by AT&T, Apple’s exclusive network partner in the United States.


Also, 20 percent of British mobile users already have 3G-enabled phones, according to M:Metrics, a research firm. “There’s no doubt it’s going to be an obstacle for Apple,” said Paul Goode of M:Metrics. “You’re going to be asking people to downgrade in terms of capability.”

Apple is also going against the grain of the European mobile business by charging £269 ($538) for the phone in Britain, and locking customers in to 18-month contracts at monthly rates of £35 to £55 ($70 to $110). Typically, carriers discount even high-end cellphones in Europe.

Furthermore the carrier O2 has spotty EDGE coverage; the compensation will be free access to a network of WiFi hotspots, according to this article. Interestingly, this article has also raised the specter of competition between wifi and 3G, a topic that has been the subject of several academic studies (see this, for example).

To me, this highlights the potential difficulties firms face when transferring a technology that is successful in one commercial/social environment to another. Can you find other examples of telecom-related technologies that did not translate well? How are these different from technologies that did transfer well?


jesus said...

Another good example of technologies that don't translate well is the use of CDMA2000 in any version, at the beginning it was because governments were trying to protect their domestic carriers that had already deployed the infrastructure to provide GSM. nowadays there are some European carriers trying to implement it, but since the market is already dominated by GSM they are having many difficulties.

Martin Weiss said...

I'd have to check, but it may well be illegal to deploy CDMA 2000 ...