Wading Into The N95 Crippling Furore

location based services

[ they had better not try this in Oz or NZ ]

y Carlo Longino on April 24th, 2007 in Mobile Operators
There’s a bit of an uproar going around about how Vodafone and Orange in the UK are “crippling” Nokia N95s they sell by removing the internet telephony plumbing that allows the use of integrated third-party VoIP services over the device’s Wi-Fi connection. Users can still make VoIP calls through services that have a separate client, but can’t use ones that integrate right into the phone and let users dial from the phonebook and so on.
The fuss is mainly being kicked up by Truphone, providers of the type of VoIP service that can’t run on a Vodafone or Orange N95. Its CEO told El Reg he’ll complain to British telecoms regulators, and accused the operators of contravening European laws.
I’m not quite sure what to make of the situation, and I’ve got some conflicting feelings about things, so let’s try to make some sense of it, then tell me where I’ve gone wrong (or gotten it right) in the comments.
Operators blocking this sort of thing is stupid. But if that sort of stupidity were illegal, the operators would be in jail already. It’s rather pointless to block this stuff, because all it’s going to do in the end is piss off some users. At this point, there aren’t enough people using, or even aware of, these services for any revenue loss to be a concern. Second, the people trying to use these things are savvy users who, if they can’t do something on one operator, will just churn to another — and how is that preventing “lost” revenues? Third, if people want to make cheaper calls, they’re going to do it one way or another. If it’s not VoIP, they’ll use a landline, or a calling card, or a callback service. (More along these lines from Dean Bubley.)
Truphone obviously isn’t a disinterested party. Their agenda here is pretty clear: if all compatible phones have the software required to use their service removed by operators, it’s going to make life pretty difficult for them. So, they whip up a frenzy about the big, bad operators’ anti-consumer policies, and even if they don’t get the operators to change their ways, they’ve gotten a ton of free marketing — even if this particular issue affects only a handful of users. (Keith McMahon has some more talk about Truphone and the size of its market.)
All that said, if operators want to remove the VoIP capabilities, let them. As I said above, it’s a move that will backfire in the end. But at the same time, I can understand how they’d see a company like Truphone as leeching off the subsidies they pay out on mobile devices. These companies depend on operator subsidies to get high-end devices which can access their services into the hands of potential customers cheaply — and then they want to sell a service that directly competes with the operators’ core offering. That would probably upset me, too — though my reaction wouldn’t be to try and block their services. To suggest that operators shouldn’t be allowed to determine what’s included on or left off the handsets they sell will hasten the end of operator subsidies. And as much as people love to get worked up about operators “crippling” devices, they love the cheap handsets subsidies provide even more. If they didn’t, the reaction to this sort of story would be “fine, I’ll just pay more and get the unlocked, SIM-free version.”
For me, this is an issue of disclosure. Operators and retailers should openly disclose the specs of the devices they sell. Should this mean they have to make it clear what functionality or applications they remove? I’m on the fence about that, but I think as long as they make some detailed specs listing the features the devices they sell do contain readily available, it shouldn’t be a problem. However, judging by the listing for the N95 on Vodafone’s web site, they’re not doing this. I think a useful example could be how cars are advertised and sold: manufacturers’ advertising plays up certain features, which are often options. Not every model features those options, but when you go to a dealer, it’s made very clear which features a particular car does have. Conversely, the window sticker doesn’t say “This car does NOT have…” and list all the options it doesn’t have.
I think that more transparency and better information for consumers is something that we can all get behind, but to imply that operators shouldn’t be able to change the devices they see fit is a step too far. As I said, doing so endangers subsidies — but it could also see handset vendors start selling dumbed-down handsets to all their carrier customers, leaving out features from unlocked versions as well so operators wouldn’t fall foul of “anti-crippling” laws