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  • European Carriers Threaten "War" Over Built-in SIM


    Apple's (as yet unconfirmed) plans to make an iPhone with a built-in, programmable SIM chip is getting a strong push-back from European carriers who would have the most to lose from the shift away from physical SIMs. The Financial Times of London reports that carriers are saying Apple may provoke a "war" if they pursue this technology, and that they may decide to just stop offering iPhone subsidies in protest. Meanwhile, the industry group representing carriers is working on its own embedded SIM.

    As we reported a few weeks ago, Apple is said to be working with SIM-card manufacturer Gemalto to make a programmable SIM-on-a-chip that would let consumers buy a phone directly from Apple and activate it with the carrier of their choice via iTunes. This worries European carriers, who recognize all too clearly that this built-in SIM would make them no more than service providers, and potentially ending the lucrative multi-year contracts that have been most iPhone carriers' bread and butter. The FT story quotes a senior executive at an unnamed European telecom as saying this could lead to a "war" between operators and Apple, and that Vodafone in the UK, France Telecom and Telefónica in Spain are "privately saying" they may refuse to subsidize the iPhone if it uses the built-in SIM. Given that the unsubsidized iPhone 4 16GB costs $599, and the unsubsidized 32GB costs $699, sales would plummet. Robin Bienenstock, an analyst at Bernstein, told the FT that iPhone sales worldwide could fall by "up to 12 per cent" if carriers cut subsidies.

    Nevertheless, embedded SIMs are looking more and more like the wave of the future for mobile devices. The GSM Association - the largest trade organization for carriers and phone manufacturers - announced on Thursday that they're developing their own standard for an embedded SIM. A task force of technical experts from AT&T, China Mobile, Deutsche Telekom, France Telecom Orange, KT, NTT DOCOMO, SK Telecom, Telecom Italia, Telefonica, Verizon Wireless and Vodafone will work with SIM manufacturers on the technology, which they claim will be ready to ship by 2012. In addition to providing "e-wallet" and other Near Field Communications (NFC) capabilities to mobile phones, the embedded SIM would also allow devices like cameras and GPS navigators to get online.

    Source: Electronista
    This article was originally published in forum thread: European Carriers Threaten "War" Over Built-in SIM started by Paul Daniel Ash View original post
    Comments 38 Comments
    1. jibaro3's Avatar
      jibaro3 -
      Humm is all about money no choices for the customer. I can see early termination fee up to $1000.00
    1. whereswaldo's Avatar
      whereswaldo -
      I would hardly call 3 carriers very much, since their are hundreds of European carriers
    1. staterunner180's Avatar
      staterunner180 -
      I don't understand why this would affect sales for the phone. People buy unsubsidized iPhones from Apple all the time and put their own SIM cards in. The carriers could still sell subsidized iPhones at a lower price and people would still buy them. The only reason to buy an unsubsidized iPhone would be if you wanted to use it on a carrier not officially supported, such as T-Mobile.
    1. ShredNasty's Avatar
      ShredNasty -
      I bet apple is s-s-shaking in their boots. Voda who? They'll shut up and be happy that iPhones exist and find a way to remain profitable. To force the euronazis to stop the 3 year contract bs is awesome for consumers.
    1. Captinsmooth's Avatar
      Captinsmooth -
      Yeah this story feels like it is missing some info here. I don't understand why the euro carriers care about having an embedded sim function compared to a removable sim. What effects will this have on the carriers?
    1. feidhlim1986's Avatar
      feidhlim1986 -
      This probably won't fly with European Laws anywho. Many European countries have to sell iPhone's unlocked by law (even since the original iPhone)
      And not being able to easily swap out SIMs when roaming/traveling to other countries. I would much rather by a pay as you go SIM when I go traveling around and just pop it in, rather than have to go through iTunes and probably find out that the network isn't available to program into the built in SIM.

      All the above posters clearly not in Europe where you are far more likely to be traveling between countries and networks. You might not see how stupid this would be if you don't leave your country that much if at all.

      @ShredNasty, there are no 3 year contacts. The most I've seen are the standard 12 months you see for most bill pay phones.
    1. mattoligy's Avatar
      mattoligy -
      I live in the UK and I think it's about time greedy corporate mobile network providers are put in there place! This new technology is Great and convenient! They Are no more than "network providers" and that's how it should be! I never buy a device from the network providers I always buy direct from the manufacture!

      On a side note, do these retards know how much money they would Save if this technology came to use on a huge scale via not having to fund high street retail stores!!

      I hate them all anyway, greedy corporate ***** pushing everyone around and robbing people of millions through there over priced crappy services!!!!!!!
    1. Puka1701's Avatar
      Puka1701 -
      Quote Originally Posted by Captinsmooth View Post
      Yeah this story feels like it is missing some info here. I don't understand why the euro carriers care about having an embedded sim function compared to a removable sim. What effects will this have on the carriers?
      This is my view on it:
      When you buy an iPhone in the US, you can buy it from an AT&T store or an Apple store. <>EDIT<>They don't like you going to the Apple store to get it, but what choice do they have?<>/EDIT<> Either way, AT&T needs to physically get an AT&T branded SIM into your iPhone. With an integrated SIM, you buy your iPhone, then head to the &carrier& store to have them program your SIM chip. Mobile phone companies like physically selling you the phone.
      Keeping in mind that Verizon's CDMA standard uses a similar integrated "SIM" equivalent.
    1. StealthBravo's Avatar
      StealthBravo -
      It would sweet if you could program several carriers on one sim and then choose provider from settings
    1. mattoligy's Avatar
      mattoligy -
      Basically the service providers in Europe give you a "free" handset if you sign up for a 24mo contract (which are usually about £40-50pcm! Now if you work that out overall, that's over £1000! So the handset is far from "free"...

      If people start getting their phones direct from apple they pay about £500, half the amount! And if you get a " sim only" deal it's about £10-20pcm with NO contract exceeding One month! The carriers don't like the idea of not having a leash on the customers for Two Years, because then they can't push there customers around, rip them off, and do whatever they want without the customer being able to say "you know what, fcuk you I'm gana go with a different provider"

      And they also count on the fact that people usually go over their minutes, txts, etc and incur a higher monthly bill (making the provider even more money)

      Also if a customer wants to switch provider mid "contract" they currently have to "buy the contract out" if the monthly contract comes in cutting them out as a middle man they won't be able to do that either!

      Basicly they will have to offer Good service to keep there customers! And we all know there's more chance of Apple and Microsoft joining forces than that happening!!!!
    1. phrotac_jaffa's Avatar
      phrotac_jaffa -
      With an embedded SIM, the end user can connect to iTunes and simply "choose" which provider they wish to have. iTunes may even have it set up to compare the different providers, much like Progressive Insurance in the USA, so people can choose the best deal for them. That doesn't mean they won't have to sign a contract, it just means they get a choice. In the USA, even if you bring in an old Motorola StarTac with the antennae missing, AT&T will still make you sign a 2 year contract upon activation (which I think is MAJOR BS!!!) unless you choose prepaid.

      Also, if you decide to change carriers, there will be no need to unlock and get a different SIM, you simply have to connect to iTunes and choose a different carrier, unless, of course, they DO require a contract upon activation. If that's the case, all they have to do is choose a carrier that doesn't require a contract to start with.

      Just my $0.02
    1. kingboarder's Avatar
      kingboarder -
      For me, who travels 300+ days a year, this integrated SIM is complete BS.
      I'm not going to have an iPhone on a AT&T contract and then pay them their outrageous roaming fees whenever I'm abroad.
      Right now, I own a factory unlocked iPhone 4. I do have an AT&T contract but whenever I'm in Europe, I just get me a local pre-paid SIM card, pop it in my iPhone and that's that.
      CDMA carriers like Verizon use such an integrated SIM equivalent and this was one of the main reasons for me to go with AT&T. I don't want to activate and deactivate phones over a hotline or iTunes, I just want to swap out the SIM.
      I fear that with the integrated SIM, Apple may deny us this possibility. I fear that when you sign an iPhone contract with AT&T that your contract will be bound to exactly that phone, without the possibility to maybe sell your phone on ebay and get a different one halfway through your contract.
    1. piston597's Avatar
      piston597 -
      This seems pretty dumb considering the fact if I break my iPhone I can't switch out my sim to an old crappy phone cuz there is no sim... my family has like 20+ old phones that we used over the years in a drawer just incase if one of ours break... this will just obsolete them....
    1. ND1612's Avatar
      ND1612 -
      I just wanted to point out the Typo. "up to 12 per cent"

      Quote Originally Posted by Paul Daniel Ash View Post

      Apple's (as yet unconfirmed) plans to make an iPhone with a built-in, programmable SIM chip is getting a strong push-back from European carriers who would have the most to lose from the shift away from physical SIMs. The Financial Times of London reports that carriers are saying Apple may provoke a "war" if they pursue this technology, and that they may decide to just stop offering iPhone subsidies in protest. Meanwhile, the industry group representing carriers is working on its own embedded SIM.

      As we reported a few weeks ago, Apple is said to be working with SIM-card manufacturer Gemalto to make a programmable SIM-on-a-chip that would let consumers buy a phone directly from Apple and activate it with the carrier of their choice via iTunes. This worries European carriers, who recognize all too clearly that this built-in SIM would make them no more than service providers, and potentially ending the lucrative multi-year contracts that have been most iPhone carriers' bread and butter. The FT story quotes a senior executive at an unnamed European telecom as saying this could lead to a "war" between operators and Apple, and that Vodafone in the UK, France Telecom and Telefónica in Spain are "privately saying" they may refuse to subsidize the iPhone if it uses the built-in SIM. Given that the unsubsidized iPhone 4 16GB costs $599, and the unsubsidized 32GB costs $699, sales would plummet. Robin Bienenstock, an analyst at Bernstein, told the FT that iPhone sales worldwide could fall by "up to 12 per cent" if carriers cut subsidies.

      Nevertheless, embedded SIMs are looking more and more like the wave of the future for mobile devices. The GSM Association - the largest trade organization for carriers and phone manufacturers - announced on Thursday that they're developing their own standard for an embedded SIM. A task force of technical experts from AT&T, China Mobile, Deutsche Telekom, France Telecom Orange, KT, NTT DOCOMO, SK Telecom, Telecom Italia, Telefonica, Verizon Wireless and Vodafone will work with SIM manufacturers on the technology, which they claim will be ready to ship by 2012. In addition to providing "e-wallet" and other Near Field Communications (NFC) capabilities to mobile phones, the embedded SIM would also allow devices like cameras and GPS navigators to get online.

      Source: Electronista
    1. mastuul's Avatar
      mastuul -
      Quote Originally Posted by StealthBravo View Post
      It would sweet if you could program several carriers on one sim and then choose provider from settings
      It's nice to be able to switch your sim card whenever you like, so having that capability in your settings would be great.
    1. rayzeur22's Avatar
      rayzeur22 -
      If this means we can use any network we want without unlocking, I'm all for it!
    1. phrotac_jaffa's Avatar
      phrotac_jaffa -
      Quote Originally Posted by kingboarder View Post
      For me, ...this integrated SIM is complete BS. I'm not going to have an iPhone on a AT&T contract and then pay them their outrageous roaming fees whenever I'm abroad...
      I agree 100%! Here's what I predict. I see sales of new iPhones with embedded SIMs falling while the value of used/refurbished iPhones without embedded SIMs go through the roof. I'm glad I purchased my 3G now while the prices are still low. Of course, I wanted a 3GS but I wasn't sure if it would work with prepaid SIMs or not.
    1. mardinn's Avatar
      mardinn -
      Quote Originally Posted by StealthBravo View Post
      It would sweet if you could program several carriers on one sim and then choose provider from settings
      That is thinking ahead.
    1. rickuk's Avatar
      rickuk -
      This idea sucks, what's the betting that Apple will only allow you to change your carrier once a year or maybe never. It will kill the luxury of being able to change carrier every time you cross a countries border to save money

      Asking consumers to pay for the full cost of a iPhone upfront is going to kill the iPhone in Europe where people expect to have a subsidised phone with a free upgrade every 12 - 18 months (they tend to forget that they are paying the full cost of the phone over their contract period)
    1. feidhlim1986's Avatar
      feidhlim1986 -
      Quote Originally Posted by mattoligy View Post
      Basically the service providers in Europe give you a "free" handset if you sign up for a 24mo contract (which are usually about £40-50pcm! Now if you work that out overall, that's over £1000! So the handset is far from "free"...

      If people start getting their phones direct from apple they pay about £500, half the amount! And if you get a " sim only" deal it's about £10-20pcm with NO contract exceeding One month!
      That 40/50 a month is not just to have a phone. It usually includes all the calls and texts and internet you'll use in that month. You're not spending £1000 on the phone.

      You can buy your iPhone direct from Apple and unlocked already and put in your £10-20 a month SIM. We all ready have the option and freedom to do this with any GSM carrier globally.
      But with this internal Apple SIM, we'll only have the option to program in the networks Apple wants us to.