The Consumer is entitled to choices: Good for Vodafone But Bad For All Carriers – REGULATION MAY BE AROUND THE CORNER

Implications: On the surface the Vodafone injunction against Deutsche Telekom (DT) would normally offend me. I hate using the legal system in a manner that prohibits competition. However, the injunction against DT is necessary. The whole idea of having a single device work on a single network effectively means consumers are forced into specific carrier networks because of a device as opposed to the services sold on the network. In effect, the consumer is given less choice. Its like being held hostage by a vendor and a carrier. What the situation in Europe can lead to is regulation and legislation, where there was once none. This is not the same as any retail business. If you think so, then you don’t get it.

Analysis:

Vodafone is obviously being driven by the fear that the iPhone could result in a challenge to Vodafone sales. However, the bigger issues are:

    -  Consumer choice and their access to the wide network of networks.

    -  Regulation

The horrifying thing that could happen is that the carriers and Apple could ultimately create a situation where other vendors are forced to do the same thing. The result is the consumer will be unable to buy service from AT&T unless they buy an Apple phone. I have said it many times before exclusivity is bad for the consumer. What I did not think would happen so soon, is that regulation could be a possibility.

Forget about all that nonsensical talk of the iPhone possessing an intuitive user interface, hence the device is great and Apple is great. Here is a bit of new for the Apple head, Samsung’s F700 has an intuitive interface. In a year, everyone will have copied the look and feel of the iPhone interface. In a year, the iPhone will be just another device. People are forgetting that consumers have aright to choice. Stop the Apple worship and pay attention to what is going on. Ultimately this is even bad for investors.

For those investors who are not thinking of the consumer, then think about this one:

ØThe Vodafone injunction is going to force regulatory agencies throughout Europe to look at what is going on. This could and likely spill over to the USA.

Regulation is often necessary to control avarice behavior of many companies. However, the carriers in the USA have sought to keep wireless regulation down to a minimum, for the last 25 years, in order to operate their business without “Big Daddy” looking over your shoulder. The carrier community in general has always had a policy of self regulating as much as possible to forestall government intervention.

Vodafone’s action, though warranted, may have just unleashed “Big Daddy” on all of the carriers throughout the world.

YEESH!! Talk about selling stocks short and being shortsighted.  AT&T and Apple may have made a quick buck only to have the legal authorities and regulatory authorities get into the handset and pricing game.