Hello! And welcome to our Friday column, Worst of the Week. There’s a lot of nutty stuff that goes on in this industry, so this column is a chance for us at RCRWireless.com to rant and rave about whatever rubs us the wrong way. We hope you enjoy it!
And without further ado:
We here at Worst of the Week headquarters take great pride (nearly) every week in highlighting the lighter aspects of the wireless telecommunications industry, which is always in need of some lightening. The past 12 months have yet again provided plenty of fodder for this endeavor and we figured we would use the final WOTW column of 2014 to highlight the highlights as well as highlight what we think will be the highlights of 2015.
First of all, 2014 will go down as one heck of year for the domestic mobile space. There did not seem to be a week without a new device launch, new rate plan unveiled or spectrum auction activity. As someone who likes all three of those things, it’s easy to say that I enjoyed covering the wireless telecommunication space over the past year.
On the device front, we were bombarded with new devices from Samsung that seemed different in only the smallest details; Apple (finally) unveiling iPhone models with a screen that can be read by this country’s aging population, but not stop a bullet; and those vendors not named Samsung or Apple throwing out their best in an attempt to be mentioned in the same breath as Samsung and Apple, to varying levels of success.
Perhaps the most important device launch, however, was the most recent when BlackBerry released its Classic device, which wraps a design that is as classic as it is useful around modern specifications. Will this device propel BlackBerry back into its place of dominance? You will have to make it down to the 2015 predictions section to find out.
In terms of the onslaught of new rate plans unleashed this year, the fact that Verizon Wireless was forced early on to actually acknowledge its competition points to the initial impact of the moves, while its most recent comments that it was being impacted financially by these moves highlighted the impactful nature of what we witnessed in 2014.
Most will point toward T-Mobile US as the true instigator in terms of driving the industry to the precipice. We can’t leave out the fact that had other operators not responded as aggressively as they did, the overall impact would likely have been muted. Thankfully, everyone got aboard the crazy train and we were entertained with the carnival of madness.
This year also witnessed not one, but two spectrum auctions. We had gone years without having companies throw money at thin air, to then have two such events happen within the same “Cute Cats” calendar that adorns my wall.
The first auction, which was initially dubbed H-Block, then changed to Auction 96 before finally becoming known as the Dish Network show, did not portend to much excitement as final bids only just matched the minimum reserve price set aside by the Federal Communications Commission, and only after Dish threw in all the “just-in-case” cash it had tucked away in its sock.
Thankfully, AWS-3, aka Auction 97, more than made up for any disappointment felt by Auction 96. At this point, Auction 97 has more than doubled the previous high point in auction proceeds and is inline with matching the total haul from all previous spectrum auctions combined. I have no idea how rational the bidding activity is from a business perspective, but it’s fun to watch.
On top of those things that actually did happen, we were also entertained by what did not happen, most obviously Sprint buying T-Mobile US. This was something that I could not have supported any more and for all the wrong reasons: I just wanted to see the calamity that would ensue.
Take it to the bank
Now, as we look ahead to 2015, I must admit that I have very low expectations. Not that I don’t think “things” will happen, but just that after living through what we saw in 2014, there is no way 2015 will be able to compare.
From the sound of it, Samsung is going to curtail new device launches from every week to at least every other week, so that will take down some of the device hype by a notch. Also, since Apple used 2014 to unveil completely revamped iPhones, we can expect 2015 to see “internal” advances that will still result in people breaking out their camping equipment.
On the other hand, the pricing wars that we saw in 2014 will continue to accelerate as the game of “Chicken” comes to life as one domestic carrier will include a free chicken each month should a customer port their number over from a rival. A free chicken!
This game will see Verizon Wireless and AT&T Mobility struggle to only rake in $40 billion each per year in profits compared with the $41 billion that analysts expect, thus sinking their stock prices to penny levels. T-Mobile US will also struggle financially, but not care because of Twitter; and Sprint … well … Sprint will be Sprint, for better or worse.
As for spectrum auctions, the FCC has already pushed back any chance of the 600 MHz incentive auction from happening into 2016, thus the only “real” auction activity we can expect in 2015 is if the current AWS-3 auction happens to spill into January. Thus, the only spectrum-related excitement will be the continued back-and-forth between mobile operators on “fair” rules for the 600 MHz auction, and the amount of greed that will spill out from the broadcaster community looking to get a piece of that sweet, sweet auction money.
I probably should also put in some sort of prediction on what will happen with net neutrality in 2015, but all my Magic 8-Ball keeps telling me on that topic is: come back in 2016.
There you go folks, I have written out vaguely what will happen in 2015, with just enough detail to fill a column, but not enough to really be useful. All I ask is that you use that information for good, not evil; make sure the house gets 10%; and don’t forget to tip the wait staff.
Finally, have a safe and sound holiday season and we will see everyone back here in January for WOTW 2015.
I welcome your comments. Please send me an e-mail at dmeyer@rcrwireless.com.
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