WOTW tackles three different subjects this week – Samsung, Sprint and overages – all to varying degrees of success. You’ve been warned
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!
Typically I can hone this column onto one topic during any given week, but for some reason that was not the case this week. So, instead I will attempt to tackle three separate items, with each item receiving just 33.3% of my usual attention. (You have been warned.)
Is Samsung really burned?
For those out of the loop, or at least those who have not flown a commercial airline over the past several weeks, Samsung’s top-of-the-line Galaxy Note 7 device is such an awesome phone it’s required not one, but two recalls. Both of which were for the same thing: the potential for exploding batteries.
Pretty sweet.
This is obviously a big set back for Samsung as it managed to get the new device out into the market ahead of Apple’s latest iPhone 7 launch and thus likely managed to keep devoted Android users as well as potentially sway iPhone users that may have been frustrated with the lack of new innovation from Apple.
But, my guess is the setback will be muted mostly due to atrophy in the market.
Sure, some former Note 7 owners might use the issue to switch to Apple, but that’s a pretty big user interface leap and plus I think most people using the Note 7 are all about that stylus, and unless they can find some pristine Treo 650s on eBay, there is very little choice out there for people who like to point sticks at their smartphone screens.
And, it’s not like any other Android-based smartphone company is nailing it in terms of wooing consumers.
Motorola can’t seem to get its act together in the eyes of consumers despite some compelling features and low prices; HTC is a mere shell of its once promising future; and BlackBerry … well … it’s BlackBerry.
There might be some potential from the likes of LG, which is set to unveil its V20 halo device in the coming weeks, but if history is any indication few needles will be moved. Same with Huawei and ZTE, both of which always seem to be knocking on the door in terms of really penetrating the upper-echelon of smartphone makers.
A more likely benefactor could be Google, which in a timely manner unveiled its latest Pixel devices just as the Note 7 issue began to heat up. Sure, Google has never managed to really make any market progress with its smartphone efforts, and by linking its only carrier outlet to Verizon Wireless looks to be a step back in time, but perhaps some beneficial timing could provide an opening.
My guess: Samsung will quickly move past this issue by burying the Note name and rolling out a dozen new Galaxy models in the next four days. Nothing better than confusion to get past some bad press.
Sprint plays with money
Sprint this week moved on the third leg of its three-legged financing model, this time using its spectrum resources as collateral on securing up to $7 billion in new liquidity. The initial plan is to just raise $3.5 billion backed by a portion of its 1.9 GHz and 2.5 GHz holdings, but the proposal does allow for up to a doubling of that amount.
There is a lot of minutia in what Sprint is doing, but at this point I am all on board in terms of the creative ways in which Sprint is going about raising money.
Selling the future value on returned lease devices? Sure.
Using network equipment to back funding plans? Whatever.
Leveraging invisible airwaves, which in some cases Sprint does not actually own and in other cases it’s leasing from the government? I am sure it makes sense to someone.
(I will refrain from diving into Sprint’s alternate money-raising scheme, which is to charge consumers half price for service, because I have not quite figured that one out.)
Perhaps the best description of this latest deal came from Fitch Ratings, which in a report noted the up to $7 billion program was “backed by ‘hell-or-high-water’ lease payment obligations … .” Anytime something has that sort of backing, you know it’s legit.
If I were a Sprint employee, I would not get too attached to anything around the office as it’s likely to be part of the next round of leveraged liquidity gathering.
Not over overages?
For some reason the mobile telecom space cannot get out from under the dark cloud that it’s always trying to screw over consumers. Maybe it’s the volumes of fine print needed to explain simplification moves … or maybe it’s just overages.
This week included news reports of bold claims about consumers being overcharged for wireless services, as well as comments that recent moves by carriers to combat usage overages may not actually save consumers any money.
I have proposed numerous times that it’s not the fault of wireless carriers that customers can’t seem to grasp what appears to me to be relatively straightforward terms and conditions on wireless services. I mean it’s all spelled out at the bottom of the page in two-point type! Come on people!
But, perhaps mobile carriers are indeed the tyranny of evil men.
(Warning: NSFW; also known as every Quentin Tarantino movie)
Maybe these operators are really only out there to shake as much money from the pockets of consumers as possible in order to keep feeding the beast of other consumers who want to make money from those profits.
It’s a vicious cycle.
I guess my new point of view is that with consumers looking to do more and more on their mobile devices across mobile networks, it’s becoming more difficult to simplify billing. Sure, an operator can attempt to lump all of its normal connectivity options into a flat rate, but what appear to be random taxes and fees can alter the final price consumers pay each month.
Consumers, though, also need to realize that just because they are doing something on their mobile device does not mean it’s part of the package they are getting from their carrier. Over-the-top services – both legit and not – are outside the control of operators both in what those services charge consumers and the amount of resources they siphon off from a consumer’s service allotment.
It’s all quite complicated really, and in a world already overly complicated it’s likely the mobile industry will never get over overages.
I welcome your comments. Please send me an e-mail at dmeyer@rcrwireless.com.
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