Apple’s quiet mobile revolution

Apple’s iPad launch event last week was fairly uneventful. The iPad Air 2 looks impressive and the Retina display iMac even more so. But there will be no queues in front of Apple stores this time around. Indeed, most of the event was filler, perhaps to cover the fact that Apple’s product strategy does not have the Jobsian balance it once had. (I mean an iPad Mini 3, “give me a break, it is barely an iPad Mini 2.1!)

But not even announced at the event and hidden in the iPad Air 2 product page was this.

One SIM, Many Options

The new Apple SIM is preinstalled on iPad Air 2 with Wi-Fi + Cellular models. The Apple SIM gives you the flexibility to choose from a variety of short-term plans from select carriers in the U.S. and UK right on your iPad. So whenever you need it, you can choose the plan that works best for you — with no long-term commitments. And when you travel, you may also be able to choose a data plan from a local carrier for the duration of your trip.

What does this mean? It means you can change carrier on the iPad without changing SIMs. That wasn’t how it used to work. What used to happen is if you wanted to change carrier you had to have their SIM inside. Now you don’t need this. One SIM will handle AT&T, T-Mobile, Sprint and EE (in the UK). So you can travel between the UK and US without changing SIM. I suspect there are more carriers to come and all around the world. No more data roaming issues or searching for WiFi hotspots. To be sure, I have never understood why international data roaming hasn’t been resolved but at least we know now that Apple is on the case.

But why was this buried? After all, they had so little to talk about. My conjecture is that this one of those things like “making time in the air.” As Seinfeld said: “isn’t that interesting? Why don’t you just go fast all the time?” So isn’t this ‘soft SIM’ interesting, why isn’t that on all devices?

I suspect the answer is that there is no reason why it isn’t on all devices or perhaps the reason is related to voice calls on cellular networks — something the iPad doesn’t do. So let’s assume that is the case. Then what Apple may want to do is to put out a data only smaller device — an iPad Nano if you will. That device can connect to any network and, of course, can receive voice calls over IP (Skype or what have you). Most users won’t miss the phone part — my 13 year old considers the phone just an app and not an important one at that; he puts it in a folder. This device will appear to be a serious threat to the mobile business model.

What will be the impact of such a change? It would be tempting to think there would be mobile war. After all, consumers can switch daily to the cheapest provider which itself will cause mobile networks to drop prices considerably. But there are limits to this. After all, networks can become congested so it is not clear that price competition will be the result.

More so, mobile telephony is a classic confusopoly. That means that carriers have done their darndest to reduce competition but obscuring precisely what it will cost you ultimately. They get you in with cheap handsets and then it is hard to tell after that but it is usually the case that your mobile monthly bill ends up higher than you expect. Even when consumers can change carriers on their device, those obsfication methods will still be at their disposal. What is more, they will look again to lock people into longer-term contracts, family sharing and other bundles to make sure you don’t actually choose carriers daily.

That said, a big chunk of your mobile bill — for calls and SMSs — will disappear. And high time too.

Apple aren’t making too big a deal about this. I don’t think they have an interest in taking over the mobile phone industry and they know all too well that this technology will open up to other device makers so it is hardly a point of differentiation. I suspect that they are mainly focussed on international travellers and while there are only a handful of carriers to just two countries on-board, the rest will quickly fall in line. In the process, options will be opened up for some new models of mobile competition and for some people (especially those not mobile data connected), that will likely be revolutionary.