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Old 19-04-2007, 01:25 PM
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Orange and Vodafone remove N95 VOIP

The Register reports that VOIP company Truphone is to lodge an official complaint with the UK telecoms regulator OFCOM against phone network operators Orange and Vodafone, over the networks' crippling of the Nokia N95 to remove VOIP functionality. Truphone has a video of the N95's crippling here. El Reg also report that Orange has started crippling VOIP on the E61 as well. In related news, the UK Trading Standards body is advising anyone in Britain who has bought a VOIP-capable handset which has been crippled by network operators to contact them at the Consumer Direct government website.
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Old 19-04-2007, 01:31 PM
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I don't like the idea of carrier removing features, but I don't think if they are subsidising the phone it seems reasonable they can dictate what is and what is not there. However I do think it needs to be transparent.

Dean Bubbley says some interesting stuff about this here.

I think talk of complaints aetc are just PR grandstanding... I think it would be better to talk more about the merits of unlocked devices and or feature limitation disclosure.
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Old 19-04-2007, 01:59 PM
krisse krisse is offline
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"I don't like the idea of carrier removing features, but I don't think if they are subsidising the phone it seems reasonable they can dictate what is and what is not there."

I don't think networks ARE subsidising phones though. Finnish sim-free phone prices are almost identical to "subsidised" pay-as-you-go locked phones in the UK, and the Finns have a much higher VAT rate of 22 %. Take away the VAT from both countries to get a better comparison, and the sim-free phones are frequently cheaper. If that's the case, then there is no subsidy at all on pay-as-you-go, and the locking/crippling can't possibly be justified.

On long term contracts, obviously if you pay nothing up front it can seem as if it is a massive subsidy for the phone, but really you're just buying the thing in installments as you might buy any other goods like cars or clothes. If you buy a contract phone, the network you buy it from forces you to pay a flat monthly fee for a set period of time, and the flat fee alone covers the cost of the goods plus profits for the network, so it's not so much a subsidy as a consumer credit facility.

If you add up all the monthly payments they cost more than buying a phone sim-free, and of course a sim-free phone usually has more functionality than a locked equivalent.

If I pay for a television with a credit card, that doesn't mean the card company is subsidising the TV, it just means they've lent me the money which they'll claw back in installments with interest on top. They shouldn't have the right to start fiddling with the TV just because I've bought it through them. It would be the equivalent of Sky buying Visa, then saying that all televisions bought with Visa credit cards must be locked into receiving only Sky channels. Who would stand for that?
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Last edited by krisse; 19-04-2007 at 02:10 PM.

  #4  
Old 19-04-2007, 02:11 PM
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Yeah there's definitely something to that (especially for PAYG) phones.

Yes you do pay for the phone in the long run I guess, though arguably they are doing you a favour by alloqing you to pay in instalments. That said some contracts are subsidised as the price per month x 12 only just matches the full price and you're still getting the includes service minutes / sms / data.

I also think if buying from anyone they can do what they like to the phone. What's wrong is not being upfront about it.

Sky subsidise there set top boxes. You get a free box but have to sign up for a 12 month contract. There boxes don't let you get Virgin (or another TV service) and nor would anyone expect them too.

For example if a VoIP carrier releases a phone I wouldn't have any problem with them making the VoIP carrier locked as the default without the ability to add other VoIP services.
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Old 19-04-2007, 02:45 PM
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"I also think if buying from anyone they can do what they like to the phone. What's wrong is not being upfront about it. "

If we were talking about the rights of individuals I'd agree, but we're talking about massive companies who together control almost all the market. In that situation, the consumer has very little ability to buy a rival's products instead, and things like price wars become virtually impossible.

In such a situation, the most relevant question is: who is the market there to serve the most? Is it there to serve the consumer, or is it there to serve the companies they buy things from? If you absolutely have to choose between the two, which one gets priority?

Most governments around the world choose the consumer, and that's the basis of anti-trust pro-competition laws such as those recently imposed by the EU on mobile roaming charges. Even in the ultracapitalist USA, governments are quite willing to restrict or even break up giant American companies if they feel the market is no longer competitive. They did it to the Bell landline phone company in the 1980s, and they tried to do it to Microsoft several times.

If you lock absolutely anything to one provider, it will reduce the amount of competition, which will make service worse and prices higher. That's bad for consumers, bad for new companies but very good indeed for incumbent companies.

If you ban locking, companies will have no option but to win customers through competition, through lower prices and/or better service. That's bad for the incumbent companies but very good indeed for consumers and new companies.

It's not just a theory either, this is what happens in the real world. Countries where locking is banned (eg Finland) have almost total phone network coverage, with good services and low prices. Countries where locking is universal (eg the USA) have relatively poor coverage, poor services and high prices.


"For example if a VoIP carrier releases a phone I wouldn't have any problem with them making the VoIP carrier locked as the default without the ability to add other VoIP services."

That seems fine at the moment, while VOIP is a small, up and coming industry, but once it's dominated by a few giants there will be severe problems if handsets are allowed to be locked.

It would make it virtually impossible for any new VOIP providers to even enter the market, because even if people want to try them out they can't as the handsets are locked. If new providers can't enter the market, there's far less competition, the VOIP providers stop bothering to compete, and prices go up while service goes down.
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  #6  
Old 20-04-2007, 09:07 AM
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That's an interesting point though I would have thought that there is the ability to buy an alternative (e.g. SIM free or go with an open carrier like 3, O2 or T-Mobile).

Who's the market their to serve - well yes always a batlle between customers and shareholders. We know most things are overcharged for because the market can sustain it.

I agree banning locking is good for competition, however over-regulation can also be a bad thing as companies may be less willing to invest in research and innovation. Finding the balance is difficult. The patent system is an example of this too (though it is not perfect either).

Makes for a very interesting debate though!
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Old 20-04-2007, 10:10 AM
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I personally have nothing against the operators locking a phone and/or removing features, provided they are clear about it. As Rafe said, if they are providing a subsidised handset (and comparing Finnish and UK prices is not necessarily a valid comparison), then they are entitled to impose some restrictions and/or limitations. At the end of the day, the selection of unlocked phones is extensive, so it's up to the user to go looking for what he wants AND to the operators to be candid about just what features they have removed.

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Old 20-04-2007, 11:27 AM
svdwal svdwal is offline
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Let the market do what it does best

In economic theory, as soon as something has been sold, the price is fair.

The seller would have loved a higher price, but he is still willing to sell for the selling price, otherwise he wouldn't have sold it.

The buyer would have loved to buy against a lower price, but he is willing to pay the selling price too, otherwise he wouldn't have bought it.

Prospecitive buyers unhappy with the goods can refuse to buy stuff, unless the price comes down, or they get more features, better quality, or what ever. But as soon as people start buying, the price is fair.

Buyers having a problem with the goods after it has been bought because it misses certain advertised features have a couple of ways to retaliate. One way is to sue, or threatheting to sue unless the deal is unmade, or they are compensated in another way.

Another way to retaliate is not to do business with the seller ever again. But this has a flipside, the seller might not be interested at all in return business. Operators have noticed that their customers don't care much about staying with them after the end of a contract. This is the 'churn rate'. This means that operators do not need to be friendly to their customers because they will be gone after the contract has expired anyway. Any operator will get new customers, the people going away from their current operator.

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Old 20-04-2007, 07:09 PM
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Talking Voip

Surely it is down to the the individual to check whether or not the provider, has the facilities on their phones, Orange and Vodaphone "DO NOT" advertise this facility. These networks are businesses at the end of the day, if everyone starts using voip, where would the money come from for the maintenance of the networks,customer services etc.

Also, when a customer takes out a handset, if its not direct from the network provider, then they also pay huge commisions to the dealers. At the end of the day, this is no different from buying a car, with some models you get central locking, alloys etc, other models you dont, so if you want air conditioning then you buy the model that has it. If none of the models have it in the type you want, then you either accept the fact or go to somewhere that does have a similar model with this feature.

English people are becoming greedier and greedier, no one want to actually pay for anything, everything we seem to want has to be cheap or worse for free. We will scream and shout at people over the phone just to get a discount on line rental or a couple of quid knocked off a handset - funny though we dont do that in a shop face to face.

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Old 21-04-2007, 01:59 PM
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I do not think it greedy to want to get as much value from a purchase as possible - it is just being pragmatic and sensible. I do not have money to give away for some shareholder somewhere to get an extra 0.02 dividend

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Old 21-04-2007, 03:01 PM
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Blocking SIP is very strange

What do Orange and Vodafone actually cause by blocking the SIP client in N95? I believe they will drive consumers to use Agile Messenger, Fring, Skype (native client still coming to S60?) and other closed or proprietary applications and services.

So what's next, operators trying to filter 3G/GPRS traffic to block these applications too? Deny all encrypted traffic?

SIP is an open protocol and supports operator class billing models. I believe it would benefit them to make sure this protocol wins instead of numerous proprietary solutions. SIP based VoIP is a friend of operators in the long term as VoIP becomes mainstream, let's say in 5 to 15 years.

I thought operators in Finland are short-sighted, but it seems operators in UK are even more protectionistic.

* * *

About subsidies of N95:

I don't know exactly what kind of voice and data plans they're offering in UK for N95, but here in Finland there would not be any point to accept a crippled device, as 24 month deals for N95 seem to start at 28 EUR/month without voice, SMS or data. This means consumer will pay about 670EUR for the device during two years. There's no save at all here. No subsidy. No bargain.

Finnish operators also offer N95 plans with voice, SMS and data, and they cost all the way from 30EUR/month to 75EUR/month. There're no device subsidies in these plans either.

Of course, if you're out of cash, this kind of deal can be tempting.

Last edited by ebo; 22-04-2007 at 02:55 PM. Reason: typos, Orange instead of T-Mobile

  #12  
Old 22-04-2007, 06:23 AM
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Only losers buy operator-crippled phones. If you don't have enough money for the unbranded phone then buy a RAZR.

  #13  
Old 23-04-2007, 01:27 AM
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Talking

I take it - YOU work for an offending network or your just a troll ;0)

heheheheheheehe

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Old 23-04-2007, 12:50 PM
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I'll just do what I did with my Orange branded N70. Change the product code and upgrade with the unbranded Nokia firmware. A bit of a risk but not much.
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  #15  
Old 28-04-2007, 02:16 PM
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good for truphone!! freedom of choice and all
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