Rogers CEO Guy Laurence says hardware is getting stale. With Apple eating all the profits, he’s right.
Dull Phone Makers:
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Rogers chief executive Guy Laurence has some apt thoughts about the wireless business. “Hardware has started to become a little bit stale,” he said at a press event in Toronto on Monday.
With Spotify chief executive Daniel Ek looking on, Laurence was talking about driving more profitability at the company. The increasing funk of wireless hardware – also known as smartphones – is why Rogers is cutting deals with the likes of Spotify.
The cable and wireless company is trying to lure customers into signing up by offering them desirable content. Rogers’ new plans give subscribers the option of a free subscription to either Spotify’s music streaming, Rogers’ (and Shaw’s) own Shomi video streaming service or Next Issue, the Netflix of magazines.
Other Canadian wireless carriers, including Bell and Videotron, have run afoul of net neutrality rules by offering such content without it counting against customers’ monthly data caps. Rogers is doing the opposite, with Laurence plainly saying he wants subscribers to gobble up more data in the course of using such services.
“A lot of plans these days, voice is virtually free, texts are virtually free – you’ve got to pay the bills somehow, right? So we’re paying for it through the monetization of data,” he said.
It’s a smart move and in line with the rules, even if it does stand to push Canadians’ world-topping monthly bills even higher.
It’s doubly smart because Laurence is right about hardware. Smartphones have become dreadfully dull, thanks to one whopping statistic: the fact that Apple now earns 92 per cent of all the industry’s profits.
A big part of that is price. Apple is somehow able to sell iPhones for a global average price of $624 (U.S.), compared to just $185 for Android.
These sorts of numbers makes one wonder why anyone else – from Samsung to Microsoft to BlackBerry – is even bothering to make smartphones anymore.
Even more amazing is that Apple says it’s on track to beat its own first-weekend record from last year when the new iPhone 6S and 6S Plus devices go on sale later this month.
Apple apparently can’t be stopped, both in terms of sales or eating up all the industry’s profits.
It’s simultaneously amazing, but as Laurence suggests, it’s also dull.
Who’d have thought it’d be the carriers and not the device manufacturers doing the more interesting things in wireless?