Benner on Tech: Cablevision Targets Telcos and Happy Hours Run Amok
People are Talking About…
Pity the poor cellular network operator.
Cablevision says that it’s going to introduce a new, low-cost, wi-fi based mobile phone service called Freewheel that’s only $9.95 a month for existing Cablevision internet service subscribers. If you’re not a customer, you can get the service for $29.95 a month. It won’t work everywhere, but it will work in areas like college campuses and cities where there are lots of wi-fi hotspots. (The Wall Street Journal notes in a piece about challenges for the wireless carriers that wi-fi networks already carried more than 90 percent of all mobile data traffic in the U.S. in 2013.)
Here’s another way to look at the news. Right now I give Verizon $120 every month so that I can connect my phone to the Internet via the company’s network every so often and connect via wi-fi far more reliably pretty much all of the time. Cablevision will soon give me pretty decent connectivity for a quarter of the price.
Freewheel is far from a Verizon killer. It won’t be truly reliable until we have something akin to a nationwide wi-fi network, so lots of people will find it tempting but ultimately worthless. And the service only works with one phone, the Motorola Moto G, which knocks out users who love their iPhones and Galaxy devices.
Even so, Cablevision’s intent to encroach on cellular turf is notable. The cable operators are already winning the broadband war. They have a series of discrete regional monopolies, so if Cablevision, Time Warner Cable, Comcast and Charter have any broadband competition, it’s usually just a content-less phone company like Verizon, T-Mobile, AT&T and/or Sprint. The phone companies, thanks to some architectural constraints, can’t deliver broadband everywhere anyway. Unsurprisingly, customers usually choose cable for their broadband connection and the telcos fight over the scraps.
But mobile phone plans are another story. The phone companies control them (and the rates we pay to stream data into our devices.) This setup is reinforced by the idea that wireless carriers subsidize the phones and tablets that we buy in order to lock us into their networks. Now a cable guy wants a piece of the mobile data action too – the market where the telecom companies have a big advantage.
I see this and wonder, in the near term...
- Does the specter of net neutrality make cable companies more tempted to break into the mobile market?
- How long before the telcos find a way to offer content too?
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People and Personnel Moves
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News and Notes
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