Slate‘s Matthew Yglesias wrote a thought-provoking post this morning claiming that “someone needs to smash AT&T and Verizon” for real, consumer-friendly innovation to occur in mobile. Yglesias, who’s in the middle of a two-year contract with Verizon, bemoans the $30 upgrade charge he paid when he bought an iPhone 5S earlier this week as well as the pricey contracts themselves.
Apple and Google have weakened the carriers’ grip on the industry by wresting control mobile apps, he rightly notes, but “they’ve grown complacent” and (my words here) cozied up to network operators. And the industry has little reason to evolve because there’s little competition due to the exorbitant cost of building a nationwide network.
Yglesias is right on several counts here: It’s true that the nation’s biggest carriers charge some outrageous fees, it’s true that Apple and Google have settled into comfortable (and lucrative) roles after their initial disruption, and it’s true that the barriers to entry for any traditional newcomer — that is, a company that would build its own network and distribute handsets directly to consumers — are ridiculously high.
But as I wrote earlier this year, you don’t have to dig deep to find some true innovation benefiting consumers. T-Mobile has eschewed traditional subsidies and offers substantially lower monthly plans, as Yglesias notes, and Sprint differentiates its service by offering truly unlimited service. Third-party messaging apps and services are forcing carriers to look beyond SMS, which has long been an overpriced cash cow. And a small wave of MVNOs and independent companies are leveraging Wi-Fi and other technologies to offer mobile service at drastically reduced prices. I understand Yglesias’s frustration — it’s a big reason I moved from Verizon to T-Mobile last year — but true innovation in mobile exists, and it’s on the rise.