Summary

Bits and bytes and minutes are all commoditizing. Audio and texting are following suit. The future of communications is in the services and being the middle man (read that as the 'carrier') is not the optimal role. ATT recognizes the need to be the producer of services.

Analysis

SmartPhones are smart only so long as you have large application libraries. And you can see that from all the carriers and vendors that are creating app stores.
Here are just a few of the 'new' app stores coming online or already in existence:
There are literally millions of developers creating applications for Smartphone. These are independent developers. Not iPhone or Google Android developers. Not Apple commoditize the application market developers. These are developers that want to sell their applications on every device on the planet regardless of which operating system (OS) the device uses and regardless of the device manufacturer.
Sounds to me like the 'application store'  and the applications offered will Plusmo pretty quickly as far as distinguishing one wireless services provider from another. Especially if every carrier offers the same devices from the same manufacturers.
And all these app stores keep the carriers, like ATT, in the mold of the "carrier" and out of the mold they want to be in as a "service provider". Granted they will be carrying services, but the services and the bulk of the services' revenues belong to the producers of the services. The carriers will still be counting minutes and bytes.
With its purchase of Plusmo, ATT is trying to break out of the carrier mold. Developing their own applications/services/widgets will allow ATT to reap the revenues of the services as well as the bandwidth. ATT will be able to create unique differentiators that allow them to stand apart from other carriers.
I've spent a lot of my career working for carriers and I chuckled to myself after they renamed themselves 'service providers' while still billing for minutes and bytes. Perhaps now the 'service provider' moniker will actually fit. At least for ATT.
Qualcomm won't by any means be the last such acquisition. Streamezzo invested big in seize.  Expect further moves by the carriers, I mean the service providers, to services control of the apps, and the associated revenue streams, that their customers use.

David Croslin consults with leading institutions through GLG

David Croslin

What is a GLG Leader?|GLG Leaders are a separate tier of Council Members with a Council Rank in the top 5%. These GLG Member Program participants are eligible for ongoing, in-depth consultative relationships with GLG clients.

Chief Executive Officer, LinoWave

 
Analyses are solely the work of the authors and have not been edited or endorsed by GLG.