« Preminet explained   |   Main   |   Sprint/Nextel Match Continues US Wireless Carrier Consolidation »

Carriers and Handset OEMs clash on branding, experience

In early November, The Wall Street Journal had a piece After Long Peace, Wireless Operator Stirs Up Industry (archived here) that gave an interesting view into the power struggle between carriers and handset manufacturers. This links into the discussion of open vs. closed systems, since when carriers like Vodafone/Verizon want to ensure each handset’s interface is exactly similar it means there’s no customization possible — even by consumers seeking to change look-and-feel. This intiative leaves little hope for independent developers, and will tend to inhibit the improvements in user-interface design because it establishes a standard all phones must adhere to which will prove difficult to change.

We’ll have to track this issue as it develops. Today I saw one piece that would suggest that Vodafone is not unstoppable in this quest, and has seen slower customer adoption. The Feature has a piece this week (interesting reading on its own) that signals that the VodafoneLive! handsets have not had as much absolute commercial success as Vodafone indicated in The Journal article: “Merrill Lynch says only 12% and 14% of the Vodafone customer base in Germany and the UK, respectively, has migrated to Vodafone Live! handsets in the last two years.”

The article also has an interesting assessment of who it will be that will determine carrier profitability.

What is becoming clearer is the importance of the top 10-20% of the customer base — those high usage customers who are early adopters of new technology. The mobile operators who can win and retain those customers, typically the number one or two operator in a given market, will be in a much stronger position.

That group is exactly the group who can be expected to find least value in a unified interface, especially if it hinders access to the unique features of their new handset.