The cell phone upheaval
The cell phone upheaval is more than a decade old, but it’s still in its early stages. The way people use the phone will change radically over the next few years, and this change will be driven by the demands of an older population.
It also changes how we buy cell phones. Cell phones are no longer a product, but a service. When you buy a cell phone, you’re not buying something; you’re buying the right to make calls for a certain amount of time. If you don’t use all your minutes, they go away and you have to pay for more. This is one reason why cell phones are so cheap: the manufacturers and carriers want to lock customers into multi-year contracts. This means that the companies can get away with selling phones at a loss, because they know they’ll make it up on the service plan.
This has been true for decades now; in fact, it’s one of the things that makes cell phones seem more conventional than they really are. They’re still an expensive item, especially if you buy them directly from the carrier instead of through a third party like Amazon or Walmart. But this model is about to change dramatically: within ten years all cell phones will be free.
I don’t think the telephone companies understand what’s about to hit them.
Cell phones are already having an impact on landline phones, but that’s just the beginning. Cell phone technology is improving so fast that in a few years it will surpass landlines in every way. And at that point, why would anyone use a landline?
People like to complain about their cell phones and cell phone companies, but it’s clear that most people love their cell phones. It’s not hard to see why: they give you tremendous freedom. The most important thing about a cell phone is that you can take it with you.
And as the cost of cell phone service falls and its features increase, more and more people are going to switch from landlines to cell phones completely. What will happen when everyone has a cell phone?
The cell phone has become a ubiquitous part of our everyday lives, to the point where it seems almost absurd to imagine life without them. In fact, it is hard to conceive of how we ever got along without them!
The first cellular phone was introduced in 1983 by Motorola. At that time, they cost $3,995 and weighed in at 2.5 pounds. Oh, and it only provided 30 minutes of talk time before it had to be recharged again!
Compare that with today’s most popular cell phones on the market; they are lightweight and portable, include e-mail and internet capabilities, have digital cameras with video recording capabilities and can store hours upon hours of music.
Cell phones have come a long way since 1983 – and so have the plans for these handy devices! As their popularity grew throughout the 90’s, many people found themselves paying outrageous monthly fees in order to keep up with the latest technology. Today’s plans are much more flexible and allow users to choose the features they want at a price they can afford.
It’s time to spread the wealth.
I remember when cell phones changed from being a rarity to something I saw on the street every day. You know what happened then, right? Everybody got one, and before you knew it you had to get one too.
Well, it’s happening again—in China, India, Africa and other places where wireless networks are just starting to spread.
This time the change is going to be even bigger than last time, because the new wireless devices are much more powerful. They’re like little computers with connections to the Internet—which means that people who get them can more easily share information with each other and with anyone connected to the Net, from anywhere in the world. And this time, there won’t just be a few million people getting these new phones—there will be billions of them.
A few months ago I spent a week in India, where I learned firsthand about this next revolution in mobile technology. I saw call centers that employ thousands of people all over India; they take orders over the phone for everything from pizza deliveries back home (yes, even in Bangalore) to real estate transactions here in Silicon Valley; they also provide tech support for computer products sold around the world.
I also visited a software company that
In 1989, when I first moved to the Bay Area, there were already a lot of cell phones around. But they were still expensive enough that they felt like status symbols—and they were bulky enough that you didn’t see many people walking around with them.
But one day I saw a guy in downtown San Francisco talking into what looked like a shoe box. It turned out to be an early model of the most famous brick phone of them all, Motorola’s DynaTAC 8000X. At the time it seemed weird to see someone talking into a shoebox-sized object in public; today it seems weird to see someone without a phone that looks like a shoebox.
The DynaTAC’s popularity was mainly due to the fact that it was almost the only option for someone who wanted a portable phone. At $4,000 it was more than twice as expensive as other models, which made it the only choice for people who simply had to have one no matter what it cost.
But even if you’re willing to pay $4,000 for something, you typically don’t want it to be obsolete in six months, so DynaTACs tended to be bought by people who really needed them. For example, in 1992 I
The mobile phone industry has been a boon for the world. It has helped connect people and make life more efficient. But it’s also caused a lot of disruption because of the constant upgrades to phones, which is time consuming and expensive.
This chart from Quartz shows that the average person’s phone is 4-years-old. This is an indication that people are not upgrading as often as they should be, or they would have bought phones more recently.
The problem with this trend is that old phones are prone to crashing, breaking, and freezing up. The only way to solve this problem is by getting people to upgrade their phones at a faster rate than they currently do. This can be accomplished through advertising campaigns aimed at convincing people they need new phones every 2-3 years instead of every 4-5 years.
In the long run, a single dominant standard is much better for consumers, who will be able to buy a wide range of products, made by different manufacturers, that work together. But in the short run, it’s all about market share. A new, incompatible standard may win if it can establish itself with users before the old one does, even if it’s not as good.
If you’re trying to figure out which standard will win, and you have any kind of emotional reaction to the question, you’re thinking about it wrong. It’s not a question of what you want to win. It’s a question of what is actually going to win.
What will actually happen? If I could tell you that, I’d be on my way to get rich making cell phones. But I don’t know for sure; no one does. There are two big uncertainties: whether people will want phones with keyboards and touch screens or just touch screens; and whether they’ll want devices like the iPhone that combine everything into one device or devices like Android phones that allow third parties to build specialized apps.
But there are two things I can say with confidence:
1) Apple already has most of the existing mobile gadget market locked up. The iPhone is by far the best