I've got a lot of respect for Chamath and his straight forward no bullshit approach. With that said, this seems like a huge challenge, and I couldn't be more excited that he's taking the lead on this.
I can fly to Riga, Latvia or many other places. Pay $5 for a SIM card (with some amount of base call/data credit) and use it when I want or need it. But in US you are charged if you use or don't use your service.
Basically it's like your electric or water meter running even if you use electricity or not.
I hope Chamath will be able to solve that. Have a network like other places in the world. Where I buy a SIM card and fill it up when I need it and if I don't use my phone for a week, I won't be charged when not using it.
We should talk. I'm working on a product that pretty much exactly matches what you described. And I've used the infinitely-running electric meter analogy in the past to point out how the current market offerings don't make sense.
Would love to have you try it out when it's ready. Send me an email if interested (in my profile).
There are lots of prepaid, pay-as-you-go options in the US too. They may not be as good or as cheap (this wouldn't surprise me at all) but the US isn't exclusively monthly plans.
See my sibling comment. We are working on exactly this, but it's not really public yet. Send me an email if you're willing to help us test it in the next couple months.
The mobile infrastructure has a hefty upkeep fee, regardless of usage. Many other utilities have monthly base charges just for the connection.
Of course now that people have more than one device the number of "lines" isn't fixed. So it does seem ridiculous that multiple devices means paying multiple upkeeps for the same infrastructure (disregarding the bandwidth used by control messages).
But given the glaring security issues with common cell radio chipsets, having multiple devices directly on the cell network is an antifeature! The same communication can be accomplished with a dedicated hotspot or a phone that tethers for everything else. Data is data - what is the advantage of making yourself more legible to the cell network?
I am sure he may have something up his sleeve. But how exactly is Rama going to compete, are they going to acquire real infrastructure or build cell sites? It will be pretty costly to build something from the ground up or to acquire customers from Verizon or AT&T, just ask T-mobile and Sprint.
Unless they have some game changing wireless technology than I don't see it happening and investors may as well put their money down a black hole.
BI says "Part of his plan involves installing microcells in customer's homes to blanket the nation, but also making it as easy as buying a cellphone to sign up for it. Another key to the plan is a portfolio of zero-rated apps that won't cut into your data, Palihapitiya said."
^That does not sound like a very good plan. Carriers like AT&T and T-mobile already have microcell options, and most people won't opt for it especially if other people get use the microcell at the cost of the person's personal bandwidth with their ISP.
What is Zero-rated apps? Isn't it similar to what T-mobile is already doing with their video and audio streaming; whitelisting Apps that will not count against data. Most carriers also have WIFI calling.
That auction that he wants to participate in, isn't that for low band spectrum like 600Mhz. That is good of extending coverage but will not increase your download speeds. Carriers like to have both low band and high band.
> What is Zero-rated apps? Isn't it similar to what T-mobile is already doing with their video and audio streaming; whitelisting Apps that will not count against data.
Given my frothing antipathy toward AT&T, and my lesser dislike of Verizon, I am very eager to see new competitors entering the mobile telephony market, especially one that is not a reassembled collection of Baby Bells.
The article is light on the details, but it seems to refer to the opportunity presented by the auction of 600MHz spectrum in 2016. The FCC has set aside 30MHz of spectrum for smaller carriers that don't have so much sub-1GHz spectrum. This is important because low-frequency spectrum travels farther and allows carriers to create broad, reliable coverage. In most markets, this will mean that Verizon, AT&T, or both will be excluded from bidding on that 30MHz.
But it would hardly help him "overtake" AT&T and Verizon with no network and probably only 10-20MHz of spectrum, possibly missing large markets like New York and San Francisco entirely due to the high price licenses in those markets fetch.
The auction is generally seen as most beneficial to T-Mobile who has a network, but lacks low-frequency spectrum in a lot of markets.
There have been many companies that have dreamed of entering the US wireless business. Many have bought spectrum only to let it languish for years and then sell it to an incumbent carrier. Looking at 700MHz-A licenses, a lot of them are owned by companies such as "C700-Salt Lake City-A LLC", "C700-Jacksonville-A LLC", "Cavalier Louisville, LLC", and "Cavalier Albany NY, LLC". Part of the issue is that it is expensive to build out a wireless carrier requiring lots of money and consumers demand a high level of perfection when it comes to their wireless carriers. The American market isn't one that tolerates even small carrier issues.
Some of it will depend on what licenses go for. I think most people are expecting licenses to run T-Mobile in the range of a couple billion given the 30MHz set aside, but T-Mobile is planning for up to $10B. Verizon just paid around $10B for around 10MHz of AWS-3 spectrum and the 600MHz licenses are a lot more valuable. But 30MHz is set aside with less competition from the big two.
Given that the licenses will likely cost $2B+ and cap-ex can often run $3-8B per year for carriers, $4-10B seems a little low to launch a compelling service. Part of the issue with the US is that it's such an expansive place and people don't want to be told "this service is only available in Maryland, DC, and Northern Virginia".
I guess the question is: what does he think he can do better. If it's cost, I can get 2-5GB of data with unlimited talk and text from Boost for $30/mo, taxes and fees included, on Sprint's nationwide network. His network will be worse than Sprint's so how much of a discount can he offer off $30 to make a much worse, completely new network compelling? He won't have loads of spectrum to offer really high data caps. And if he starts offering 100GB for $25, that will have to come down fast as people start actually using it and the network becomes capacity constrained. And customers are very used to being grandfathered into plans in wireless. If he were just competing against AT&T and Verizon, he might have an opening. But even AT&T has their Cricket brand where I can get 2.5GB for $35, taxes and fees included, on AT&T's network.
The question is: what does his entry bring to the scene? It seems unlikely that he can greatly undercut prices. It seems unlikely that microcells in people's homes will "blanket the nation". With so little spectrum compared to competitors, he won't be able to offer the speed and capacity they're offering. Without a reliable network, customers will want a steep discount to move to his service. So, how much below $30/mo can he go to grab customers? Is there something else compelling? T-Mobile already offers microcells for your home and zero-rates music and now video streaming.
I'm all for increasing competition. It just seems unlikely that this will increase competition. It seems way more likely that Dish will buy some 600MHz licenses and start rolling out a network. They already have substantial spectrum holdings and the low-frequency licenses wo...
I really hope this isn't just a 'plausible enough' cover for someone to take advantage of the absence of the big two in an auction, sit on it for 5 years and then sell on in a hopefully (to them) different regulatory environment stating that they really need the investment and weight of an existing player to use the spectrum properly.
They aren't perfect by any means but I'd much rather see DISH or t-mobile get this for reasonable pricing with the proviso that roll out happens in x amount of time.
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[ 2.1 ms ] story [ 60.4 ms ] threadBest of luck, Chamath.
Would love to have you try it out when it's ready. Send me an email if interested (in my profile).
Of course now that people have more than one device the number of "lines" isn't fixed. So it does seem ridiculous that multiple devices means paying multiple upkeeps for the same infrastructure (disregarding the bandwidth used by control messages).
But given the glaring security issues with common cell radio chipsets, having multiple devices directly on the cell network is an antifeature! The same communication can be accomplished with a dedicated hotspot or a phone that tethers for everything else. Data is data - what is the advantage of making yourself more legible to the cell network?
Unless they have some game changing wireless technology than I don't see it happening and investors may as well put their money down a black hole.
BI says "Part of his plan involves installing microcells in customer's homes to blanket the nation, but also making it as easy as buying a cellphone to sign up for it. Another key to the plan is a portfolio of zero-rated apps that won't cut into your data, Palihapitiya said."
^That does not sound like a very good plan. Carriers like AT&T and T-mobile already have microcell options, and most people won't opt for it especially if other people get use the microcell at the cost of the person's personal bandwidth with their ISP.
What is Zero-rated apps? Isn't it similar to what T-mobile is already doing with their video and audio streaming; whitelisting Apps that will not count against data. Most carriers also have WIFI calling.
That auction that he wants to participate in, isn't that for low band spectrum like 600Mhz. That is good of extending coverage but will not increase your download speeds. Carriers like to have both low band and high band.
Yes. And here's Susan Crawford explaining why Zero Rating is bad - https://medium.com/backchannel/less-than-zero-199bcb05a868
Fine to shoot it down I guess but far more interesting and exciting to think about how it could work and what it could deliver.
But it would hardly help him "overtake" AT&T and Verizon with no network and probably only 10-20MHz of spectrum, possibly missing large markets like New York and San Francisco entirely due to the high price licenses in those markets fetch.
The auction is generally seen as most beneficial to T-Mobile who has a network, but lacks low-frequency spectrum in a lot of markets.
There have been many companies that have dreamed of entering the US wireless business. Many have bought spectrum only to let it languish for years and then sell it to an incumbent carrier. Looking at 700MHz-A licenses, a lot of them are owned by companies such as "C700-Salt Lake City-A LLC", "C700-Jacksonville-A LLC", "Cavalier Louisville, LLC", and "Cavalier Albany NY, LLC". Part of the issue is that it is expensive to build out a wireless carrier requiring lots of money and consumers demand a high level of perfection when it comes to their wireless carriers. The American market isn't one that tolerates even small carrier issues.
Some of it will depend on what licenses go for. I think most people are expecting licenses to run T-Mobile in the range of a couple billion given the 30MHz set aside, but T-Mobile is planning for up to $10B. Verizon just paid around $10B for around 10MHz of AWS-3 spectrum and the 600MHz licenses are a lot more valuable. But 30MHz is set aside with less competition from the big two.
Given that the licenses will likely cost $2B+ and cap-ex can often run $3-8B per year for carriers, $4-10B seems a little low to launch a compelling service. Part of the issue with the US is that it's such an expansive place and people don't want to be told "this service is only available in Maryland, DC, and Northern Virginia".
I guess the question is: what does he think he can do better. If it's cost, I can get 2-5GB of data with unlimited talk and text from Boost for $30/mo, taxes and fees included, on Sprint's nationwide network. His network will be worse than Sprint's so how much of a discount can he offer off $30 to make a much worse, completely new network compelling? He won't have loads of spectrum to offer really high data caps. And if he starts offering 100GB for $25, that will have to come down fast as people start actually using it and the network becomes capacity constrained. And customers are very used to being grandfathered into plans in wireless. If he were just competing against AT&T and Verizon, he might have an opening. But even AT&T has their Cricket brand where I can get 2.5GB for $35, taxes and fees included, on AT&T's network.
The question is: what does his entry bring to the scene? It seems unlikely that he can greatly undercut prices. It seems unlikely that microcells in people's homes will "blanket the nation". With so little spectrum compared to competitors, he won't be able to offer the speed and capacity they're offering. Without a reliable network, customers will want a steep discount to move to his service. So, how much below $30/mo can he go to grab customers? Is there something else compelling? T-Mobile already offers microcells for your home and zero-rates music and now video streaming.
I'm all for increasing competition. It just seems unlikely that this will increase competition. It seems way more likely that Dish will buy some 600MHz licenses and start rolling out a network. They already have substantial spectrum holdings and the low-frequency licenses wo...
They aren't perfect by any means but I'd much rather see DISH or t-mobile get this for reasonable pricing with the proviso that roll out happens in x amount of time.
What a time to be alive.