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February 15, 2010

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Antoine RJ Wright

The thing about the Internet is that he article will be read all the more because of this reply Tomi. That's not a bad thing by any means. But your tone in this peace is harder to listen to than his. Unfortunately, such things will translate to those who don't do their research that you are being too heavy handed - when you clearly are not (w/factual support at that).

I enjoyed this rebuttal, as I have previous ones. This could be a neat monthly feature for you here ;)

jMac

This article is written in the tone that Tomi uses in real life. Sure, its pretty hardcore, but I believe it shows the passion involved and shouldn't be judged against.

Each to their own.

For my part - I think it balances just fine - blogged here: http://www.jonathanmacdonald.com/?p=4349

Benjamin

Liked it too - lots of efforts put into it for sure!

Tomi Ahonen

Hi ARJ and JMac

Thanks to both of you. JMac, Antoine is a dear friend and he means very well in what he writes, and he obviously agrees with the points. So no harm done, and thanks JMac for stepping in.

ARJ - You make a very good point. This rant is a one-time writing project written without an outline, and had one total revision/edit before I posted it. Then I came back and re-read it a few times only to correct edits. Even so, it stole 5 hours of my life. I am further infuriated - still now agitated - that I wasted so much of my time on this rebuttal. I am still in too much of an angry mood to be able to do justice to my job of hosting the Carnival of the Mobilists that I need to get out today here at this blog.

I know I could do a far better reply with 'calm' and very 'facts-only' non-emotional posting if I now went back and did another thorough re-edit of it. And what would that accomplish, other than steal several hours more of my time.

Richard Wray wrote total bullsh*t in his story. I called him on it. I will be posting a link to this commentary at Forum Oxford and will be monitoring the #Guardian mentions on Twitter and send that reply to anyone referencing his idiotic article. If there was a comments section on Guardian, I would also post a reply there.

But yeah, I hear you and I really appreciate it, Antoine, that yes, this could be more productive if written in a more calm tone of voice. But there is no way I am going to give that idiot Wray any more of my valuable time for free to correct his mistakes. But he better not walk into my view anytime soon anywhere, I will very loudly echo this story should he turn up anywhere....

JMac - hey, thanks for the blog and yes, you make a very good point that this (blogging) is becoming more and more the 'checks and balances' on those who should have been the 'checks and balances' haha, ie the press. Very true. And just like the Tube bad customer service example you witnessed, we have considerable power in the blogosphere.

I have to say that this greatly dimishes my respect of the Guardian overall. I loved reading Vic Keegan's articles there and it seemed to me that for the past several years, the Guardian had good tech oriented pieces. Now this story really angers me and damages their credibility in my eyes to an enormous degree.

If he had wanted to say that Europeans 'don't hold a lead in apps stores' - which may be what he meant - that would be fine, but don't say European giants have lost their hegemony to North Americans... The facts are totally not there (haha). Ok, gotta stop now, else I'll do another rant here in the comments haha..

Hey, thanks to both of you for the quick comments

Tomi :-)

Viipottaja

Great rebuttal indeed.

Only two comments though. Not everything is measured in dollars. I am referring to the share of app stores of revenues. I fully, totally agree that the apps graze is a lot of hype. However, I do think they are more important than the revenue share only implies. Apps Stores are a bit like the free Maps on Nokias now. They add value, not revenue. :)

Second, let's not get _too_ hung up on the dictionary definition of "innovation"! ;)

Faith McGary-Sepcic

Tomi: Great Post! I would stand and clap, however, I would be the only one to see myself do that.... You simply said what most think!

Faith

Isaac

You miss the point when quoting total shipments of handsets. Nokia's margins are super-thin and becoming thinner. Apple's are not. In Q3 2009 Apple made more profit from 7.4m handsets shipped than Nokia did with their 108.5m in the same period.

Would you rather sell 10 things and make a dollar on each, or one thing and make $20?

Just a thought.

Leonard Bix

I am sure the respected gentleman is NOT a clueless yo-yo or a brainless idiot. No reputable publication would put a brainless idiot as Editor; he almost certainly IS intelligent and professional.

Then the only other explanation I can think of (for such a mountain of blunt inaccuracies and outright lies) is that he could be 'motivated' by interested parties to manipulate public opinion?

Hard to prove, I know - but give me another rational explanation, please?!

V. Dimitroff

@Isaac: the numbers so enthusiastically echoed among the faithful Apple fanatics crowd are just about one quarter, and
(a) there are serious doubts whether the methods used by the two companies to calculate profits for that quarter are compatible, and
(b) even if 100% comparable and correct, Apple's (immoral) margin is hardly sustainable in the long run.

I am very curious if they (Apple) will be able to claim higher-than-Nokia profits for the whole of 2009. Let's talk again when they post results.

- - - - - - -
(Disclaimer: I only ever use Sony Ericsson handsets because I insist on camera excellence. I rejected the current best camera in the market, Satio, because it runs Symbian. Just in case someone thinks I am a Nokia fan :)

Vlad

@Isaac

Actually, as a company, you're free to do either. And I don't see one model as better than the other. It's a matter of choice.

You can influence the lives of billions of people by putting communications devices in their hands for the first time, giving them their first internet experience and genuinely making their lives better by services associated with those devices, or you can make Scoble very happy.

Just a simple matter of choice.

As a consumer though, I'm having a very hard time understanding why any company's profit margins are relevant to me. That should be their concern, not mine.

@Tomi

I'd keep an eye out for Huawei and ZTE in the future. The growth they are both theoretically capable of is astonishing.

As for Samsung, they're slowly, slowly, flooding the market with dozens, if not hundreds, of devices. This strategy is a very good copy of what Nokia's strategy used to be (I hear they've changed their minds on this), and it should probably work just as well.

Daniel Perry

It is refreshing to see the passion you display. This is part of the reason I keep coming back to your blog, Tomi. As an attorney, I am constantly amazed at how misinformed and downright thick-headed some reporters are on basic legal issues - if they would simply consult Wikipedia they would see were off-base.

I find myself uttering the observation "stupid" more and more as I read supposedly high-caliber reporting. Don't change, Tomi. We need folks like yourself who will expose idiocy.

Henry Sinn

I wonder if Leonard Bix [above] is right?
What an interesting thought - all a lie as a 'motivation' for other reasons..
How could someone out of the UK be SO OFF TARGET?

OR

Are the "drunk" iPhone fanatics moving to the point of being completely inebriated? I wonder if Mr Richard Wray was actually drunk?

I have a very good friend on an angel investment board in Silicon Valley.
They see nothing besides Apple and Android venture start ups or related business.
Just about every article written by US journalist is off track.

Tomi, I love your rebuke but it probably should be aimed at all in the US that can't see past their nose.... and that's most of them, not just the journalists.

Tomi Ahonen

Hi Benjamin, Viipottaja, Faith, Isaac, Leonard, V, Vlad, Daniel and Henry

Thank you all for the comments. I will respond to each of us as usual...

Benjamin - missed you, we must have posted at the same time yesterday.. Thank you, and yes, put a lot of effort in the writing and editing. The numbers actually are mostly so familiar as basic data of the industry, I could pull them off the top of my head and that part didn't take 'work' to research the main facts haha..

Viipottaja - haha good points, yes, apps have more impact than their pure monetary value, but still - hardware is 20% of the industry. Handsets are ony part of the hardware. Normal non-smartphones are 85% of all phones. And of the remaining smartphones, Apple has about 14%. Now, of those iPhones, not all will even ever be used 'as smartphones' because some get an iPhone simply because it is cool (looking) or simple or elegant - or received it as a gift for example without any personal wish or desire to 'install apps' to a phone. But of those who do install apps, and the evidence suggests still a majority of iPhone owners do, then we do get both the monetary value of the apps sold (and traffic load of far more free apps downloaded, as a load to the networks); and the related benefits for example to prospective buyers to consider a given phone over another and consider say the apps store of that brand etc.

I agree with you there is more to apps than their value, but apps were a very tiny part of what Mr Wray wrote about - and he was talking of the European Giants having lost their hegemony. So in that case we do need to look at scale and relevance (hegemony) and obviously 80 billiion dollars worth of mobile data value just earned in Europe is far more than under 1 billion dollars of App Store revenue earned globally... For his point of 'hegemony' the apps are completely irrelevant, like walking under a leaking air conditioner box, with some drops of water falling - and concluding its raining outside haha...

Faith - thanks!

Isaac - ok, thats an interesting point, the profit margin - but its not valid to take one quarter (why the third quarter and not the latest quarter while we are at it; but far more relevant is profits for at least a year). But Isaac - you are arguing beyond the scope of that article. I would think there is some merit to analyze the profitability of the mobile industry in Europe, North America and Asia - but Mr Wray never mentions the word profit or margin - not once - in his article. It was I who argued that profit is an additional point to consider. And here, Isaac, you do need to then expand the picture far beyond 'Apple' - the author Mr Wray clearly said North American giants of mobile telecoms have grown far bigger 'in the past year' than European (former) giants - and thus we need to consider European industry in mobile vs North American industry in mobile - not just Nokia vs Apple - and by that argument, even if Apple is profitable in smartphones - the far bigger handset maker - making nearly half of North American phones - is Motorola. And they are making losses. The biggest European handset maker is making profits. The biggest North American network equipment infrastructure provider was Nortel - now bankrupt and being sold in pieces. Biggest European network infra provider is LM Ericsson - profitable. Biggest North American mobile operator is AT&T and they are profitable but their sibling Sprint is making losses. All of the biggest European mobile operators, Vodafone, Telenor, T-Mobile, etc - are making profits.

If you Isaac want the argument to be changed to who is most profitable, European or North American giants of mobile, then again Europe wins hands down. Apple is a nice exception an watch their profit be severely hit now as they face more competition than they have ever seen with the iPod, the Newton, the Mac or the Apple II..

Leonard - haha, thats pretty wiley of you, 'motivated' haha.. one wonders.

V - good points and also thanks for the personal comment of your phone. It helps illustrate a bit about the differences in us humans. Its just like cars. Someone feels that to buy a new car the best car for them is a big family-oriented SUV. For someone else its a convertible Porsche. For someone else again its a hybrid (haha, lets ignore Toyota's current prodution problems). Similarly no matter how 'perfect' a given phone form factor may be - consider iPhone 3GS - that is copied left and right by literally every major manufacturer today - that does not mean its the only desirable form factor. For me its QWERTY keypads, I could not imagine having a phone that can't do fast typing without me looking at it. Got to have QWERTY haha.. And for you its the camera.. And for someone else its the touch screen or app store or large screen etc..

Vlad - funny, yes you can be the company that brings technology for the first time to literally a billion new consumers on the planet - with all that long-term loyalty and customer preference that will entail, plus media and ad platforms etc it will have - or you can sell to 0.7% of the mobile phone owners on the planet and sell a luxury premium product like say Ferrari or Porsche, as Apple does. But American industry cannot survive on a luxury bracket. Ferrari is not big enough to power Italian car industry and neither is Porsche for Germany. Italy needs Fiat (big enough to buy Chrysler) and Germnany has VW (and Audi), BMW, Mercedes, and several foreign car makers like Ford and GM, plus yes Porsche.. A luxury bracket niche product (like the iPhone or Google Nexus One) is not enough to sustain the industry for a continent.. The US needs a Motorola-equivalent (could be Microsoft or perhaps even RIM soon)

Good point about Huawei and ZTE, trust me, they are very much on my radar right now haha.. yes, very much must keep monitoring them, could be - and likely will be - big.

Daniel - thank you so much. It really gives me solace to read that, that there are some of our loyal readers who actually appreciated it and read it and now come here to thank me for it. Makes that time worthwhile haha. And seriously, obviously (like many others like you Daniel, like Faith in the above for example) who have read the original, felt 'its wrong' and didn't have really an outlet to find confirmation to their feelings. Yes, someone needs to point out when journalists (columnists etc) write totally erroneous articles. I can't comment on rocket science or green tech or nanotechnology haha but if they come to 'my backyard' and talk about mobile, they better come with their facts, cause if they will spread lies, I will call them out on it haha..

Henry - great point, yes really makes you think, what is wrong with Mr Wray, even more so, that he is from the UK, so why is he so mis-led or is there a hidden motivation to distort the story. (makes one wonder what brand of phone Mr Wray uses, and did he receive a free touch screen phone recently perhaps, that he may have been hoping for to get for free for a while? who knows, if they had comments section open at that article over at the Guardian, we could ask him haha)

Also valid point that this is symptomatic of the US (west coast) industry as a whole, and I do also write to them at times, if you remember, the 'West Coast Drunk' blog about apps stores last year and earlier the silly reporting by that Forbes journalist etc...

Thank you all for writing. I trust you all have also read the good news posting for the same day, the Carnival of the Mobilists - lots of good uplifting and factually correct reporting about the mobile industry by many of our fave bloggers and real stars of the mobile industry, haha

Tomi Ahonen :-)

James Pearce

The king doth protest too much, methinks.

Whether or not his factual reporting is right or not, I think the original article is on to something.

Europe's best response would be to seize the initiative back. Sadly, many original incumbents are indeed relying on past glories and a legacy telco culture.

Now... if Nokia had released a new version of Symbian which was as radical a departure as Microsoft's new Phone 7... well, that would have been an illustrative action to back your words.

Maybe next year, eh? ;-)

Tomi Ahonen

Hi James

Haha.. very funny. Now, there is nothing wrong to suggest that being big today is no guarantee of being still big tomorrow. Nothing wrong with that and tech history is full of former giants that lost it haha I remember back when IT industry was dominated by "IBM and the BUNCH" ie Burroughs, Univac, NCR, Control Data and Honeywell (look them up in Wikipedia under where have they gone haha)..

But - first the point - James, the author Wray claimed 'Europe had lost its hegemony' and suggested that was to the USA based 'giants' That is flatly not true. It MAY BECOME true, perhaps in half a decade or more, but clearly the continent with former past giants in death-struggles is North America witness Lucent, Motorola, Nortel, Sprint, Palm etc. And that Europeans tend to be the ones buying up North American assets whether Telefonica buying up former US owned assets in Latin America or Alcatel buying Lucent etc.

So I can't let you by in that the author had any merit in his article. What you talk about, is not in the article. You may have a point, he did not. He claimed 'in the past year' the hegemony had been lost in Europe. Haha, utterly patently not true.

Now, to your point about Nokia and Windows Mobile 7. I take it you are aware James that Nokia did both take control of Symbian from a former partnership that included all of its biggest rivals from a decade ago (limiting back then the ability for Nokia alone to control Symbian) - and also launching Maemo as a top-end smartphone OS. If your position is, that Nokia 'is relying on past glories and legacy telco culture' and then argue Nokia is a prime example, the facts do not stand with that position. Nokia has taken aggressively into its control the evolution of Symbian - which is an old OS and its updating is not easy or quick but is now being done.

And Nokia turned it into open source - something many industry analysts suggest is the best way forward whether you happen to believe that or not - Windows Mobile/Microsoft Phone 7 is not open source, neither is Apple iPhone OS/X and neither is RIM's Blackberry OS an open source OS. But both of Nokia OS's, Symbian and Maemo are open source (as is Google's Android).

So to your point, that European incumbents 'are relying on past glories and telco culture' your explicit example of Nokia is not fitting that pattern. Perhaps you personnally think Microsoft Phone 7 (as it is shown on demos, before its in your hand in an actual phone, and assuming it ships anywhere near on time) is a fantastic smartphone OS and better than Symbian or Maemo. Fine, that is your right of course. But you can't say Nokia was sitting still and not doing something about it. For most comparisons of the currently available OS's, the latest edition of Windows Mobile, vs latest edition of Symbian and latest edition of Maemo, most smartphone analysts prefer Symbian and especially Maemo over WinMo 6.5. I am not a programmer (anymore) and can't comment personally.

But you suggested a bigger assumption on that Nokia example, that many of European incumbents are guilty of this thinking. Again, I beg to differ. We have seen many European major players make big moves beyond their basic 'turf' from Vodafone 360 to Three's new handsets on the INQ brand to Ericsson's move to hosting networks and managing them, etc. The only major thing that North Americans have recently done, which was not a high priority for Europeans, was the apps store, and you know fully well James my view on that; that apps stores are a total side-show, a freak-show in fact, totally irrelevant (Today) to the mobile data market. The European incumbents have been smart to focus on where the money is - SMS, MMS, mobile browser-based services etc, not apps. The European mobile data alone is worth over 80 Billion dollars, and generates over 60 Billion dollars of PROFITS. Most of the app store develpers who made the 150,000 apps are not turning in any profits at all. It would be stupid to abandon profitable business to pursue loss-making business, isnt' it James..

Thanks for writing again, looking forward to more with you again.. :-)

Tomi Ahonen :-)

KPOM

I think Tomi is missing a larger point. "Innovation" isn't just coming up with something first. It's coming up with something and making it a success.

If we take a look at market cap, back when the iPhone was announced, Nokia and Apple had similar market caps. Today, Apple is worth 3.5 times what Nokia is. Stated otherwise, they could purchase Nokia with shares and dilute their existing shareholders by less than 33%. A lot of that is due to the iPhone.

Sure, Nokia might have been "first" with N-Gage, but it was a colossal failure, twice. Apple created an app store almost overnight and created a platform that in two years has spawned 140,000 applications. Everyone talked about a phone that would replicate our computers, but it took Apple to make it a reality. Does anyone here think the 5800XM and N97 series, much less Maemo 5 and MeeGo would have come to be if Apple hadn't shaken things up so much? More likely we'd be on our 12th variant of the N95 with Nokia still insisting that touchscreens were unnecessary.

To Tomi's other point, true, the European telcos have done a better job encouraging people to use services like MMS and SMS, but the US telcos' lack of market says more about their complacency and oligopoly in the US than about Europe's dominance. On top of that, it isn't like European companies operating in the US have done that well, T-Mobile USA has long languished as an afterthought of T-Mobile DE. If Europe is so innovative, T-Mobile USA ought to be cleaning up the market instead of struggling to keep pace after a decade of poor management decisions from Germany. VZW is a success, but Vodafone is a passive investor that actually thought of selling its stake a few years back but wisely decided not to. Moving to LTE makes sense, but they've done well for themselves with CDMA2000.

Anyway, in a larger sense, Qualcomm (a "west coast company") correctly predicted that CDMA, not TDMA was the way of the future a decade ago. WCDMA and LTE would not be possible without their innovation, which Europe tried unsuccessfully to work around (hence the kludgy WCDMA technology that sucks up spectrum).

KPOM

On another topic, I do think Nokia's decision to give away Ovi Maps smacked of desperation. It seems highly unlikely that they would spend $8 billion for Navteq for the sole motive of giving away the software. Ovi Maps was to be the centerpiece of a service-oriented business model. People would buy phones and then continue to provide revenue to Nokia through their Ovi Maps subscriptions.

It's also interesting that, on the one hand, Ahonen blasts the App Store for being unprofitable while claiming that Nokia always intended to give away a service that it had been selling for about $100/year. The fact of the matter is that it doesn't matter if most of the 150,000 apps are loss-making. If just 0.5% of those apps are useful, that is still more than what is available for other platforms, and it is a big draw of the product. It spawned the iPod Touch and now the iPad. Do you really think Nokia envisioned every N-Gage program being profitable? More likely they viewed it as a draw to their phones. It wasn't. App Store is. Plus, with App Store, Apple lets others do the heavy lifting while they cover the costs with the 30% revenue share. Nokia had to buy Navteq to get something with the same appeal.

Tomi Ahonen

Hi KPOM

Great comments, thanks. First on 'innovation' - one part of innovation is the invention part, another is the adapation part. Either is valid. BUT you cannot give a company 'credit' for being 'innovative' if it only copies. And Mr Wray wrote that this past year Europeans fell behind, and he took very specifically the 2008 summer launch of iPhone 3G as the point when this big leap forward happened. The original iPhone 2G was a MASSIVE innovation. A totally transformational phone. The 2008 edition of 3G iPhone was NOT. It was only fixing obvious deficiencies in the original and every single 'innovation' in the 3G iPhone in 2008 - including App store - was done by someone else years before. While the author was clearly unaware of these, and made his erroneous claim that Apple created the whole world in June 2008 - I am not going to let that slide. No, that release was a 'bug fix' iPhone only.

Market Cap, come on - that is stock market gambling, where expectation and hype play far more a role than real performance. We can go back in time and find totally ludicrous market cap evaluations in any industry - take AOL and its merger with TimeWarner as a ridiculous example. No, market cap is of interest to market speculators. If you want to measure market performance, then yes, lets measure the size of the company's revenues in mobile. As you saw, I did that analysis for us, and Nokia is what, four times bigger than Apple.

If you want a more 'human' impact - then Apple has managed to impact 0.5% one half of one percent - of the populatin on the planet. That is how many people - at absolute max possible use - have an iPhone. In reality, less than that, because some iPhone 3G or 3GS models were used by the same person who had an iPhone 2G and thus are replacements. But in absolute max possible impact, Apple has one half of one percent of the population of the planet. Nokia? is in the pockets of 22% of the planet. Who is more relevant eh? Apple is a luxury niche product. Nokia is the most widely spread brand of technology of all time.. Doesn't really compare does it.

You said Apple iPhone re-ignited the mobile 'computer' concept. That is totally true, as I predicted before the device had even launched, and that is the 2G version of the iPhone - the most important mobile phone of all time. But that is not iPhone in 2008 or 2009, that was 2007. You and I agree totally on this, but that is not what the idiot Mr Wray wrote. He said the dramatic change happened very explicitly with the 3G iPhone in the summer of 2008. That is not true. I called him on it. I think you agree.

We obviously agree on European operator innovation and both are puzzled at how inept T-Mobile has been in its US operations. As to Vodafone's 'passive' role - I can tell you for a fact (I was there) that the fight inside Verizon Wireless was intense over many years, with Vodafone using every trick the minority ownership allowed, to force Verizon's hand, to get it onto this path to LTE and the GSM side of the CDMA battle. Obviously eventually they won. Its not an easy achievement, where Verizon was chairing the CDMA carrier side, and thus a poster-child of CDMA 'supremacy' over GSM. It is no small achievement and will guarantee Verizon Wireless's technical competitive advantage over Sprint Nextel (but not vs AT&T or T-Mobile who already are on the GSM path) on a 'decade' length timescale window. Just like China Mobile vs China Unicom for example or all the markets where CDMA carriers/operators have switched to GSM and experienced dramatic market performance gains..

Qualcomm yes they played the CDMA card as hard as they could but in the process they angered most of their partners globally and faced lawsuits etc. Meanwhile the GSM juggernaut totally crushed them. Yes, the CDMA technology is underneath the 3G evolution of two of the three main 3G technologies but it was not purely a Qualcomm invention, its an international standard with a lot of input from many major players starting obviously with NTT DoCoMo (and Nokia and Ericsson etc)

"smacked of desperation' - you clearly don't know Nokia haha. No, that is actually typical Nokia. They are paranoid about missing the next big stage. That is why they do luxury phones like Vertu and ultra-Africa-cheap phones. Why they do the Ovi store and buy an ad network and a navigation company and offer maps and do mobile money etc etc etc. That is the soul of Nokia, they make sure they have a piece out of anything, early - and then they observe if it grows. If it does, they have a piece in it and then make a massive push to become big in it. Like say cameraphones - early Nokia vision was that cameras were not going to be big on phones - and did cameras as additional gadgets you could add ot your phone. Then evidence from Japan said cameraphones were creating happy customers, even when resolutions were worse than VGA - then Nokia crashed the party and before you knew it, Nokia became the world's largest maker of cameras of any type... This is typical Nokia.

Finally on iPhone App Store driving sales of the iPhone. Yes. The App Store was a brilliant move by Apple, brilliant - and I've said so countless times. But its irrelevant (today) to the mobile data industry. Its like the invention of that Segway - the electric moped that you stand on, you know.. - its interesting for human transport. Today it is totally meaningless in its volume of sales and use, compared to motorcycles or cars. But its interesting. It may become - after a decade - big. It may. It may not. But for sure the CEO's of Toyota and Ford and VW do not lose sleep worrying that the Segway will 'steal' their market. They will monitor it as a curiosity.

The App Store was brilliant for Apple, it is irrelevant to the global handset industry. Outside of the USA, the Apple iPhone App Store is irrelevant to even the smartphone market. Normal customers do not walk into the operator/carrier stores, asking 'give me the smartphone that has the biggest app store' - irrelevant. But its hype right now by totally dumb US based analysts and reporters who have been taken in by Apple's PR machine.

In five years, App Stores of all brands may be relevant and we will celebrate them here at this blog. But today they are not. I wrote a long blog explaining why, with facts and numbers. It is ONLY hype. But its clever by Apple

Thank you for writing and I know you also left a comment elsewhere. Well thought-through opinions, thanks.

Tomi Ahonen :-)

Romain Criton

Hi Tomi,

Reading your article, I was a bit surprised when you say that SIM locking is illegal in most countries in Europe, since I know that in France for instance SIM Locking is perfectly allowed, as long as the operator offer the consumer a way to unlock the phone:
- either for a fee during the first 6 months of the contract
- or for free after 6 months in the contract.
So I did a bit of research (well, actually I just looked in Wikipedia ;-) and it seems that actually few European countries have totally outlawed SIM locking:
http://en.wikipedia.org/wiki/SIM_lock#Laws_on_SIM.2Fnetwork_locking
That doesn't change anything to your argument that European carriers have NEVER been more "closed" than their US counterpart though, as stated in the Guardian article. I know US carriers have recently loosened up their "walled gardens" a bit but I remember a particular painful experience of distributing multimedia content to US carriers (especially Sprint and Verizon)...

Another subject where I disagree with you is when you dismiss the comparison between carriers and handset makers/OS vendors. Even if it is really not a matter of US vs. Europe, it is my understanding that carriers are really upset about the App Store trend started by Apple, because they see their own "decks" bypassed as far as content distribution is concerned. Just look at the recent initiative by 24 carrier to build an App Store alternative... Or the recent announcement by Ericsson.
See also the couple big mergers between Internet service providers and content publishers back in the dot com days (AOL/Time Warner, Vivendi/Universal...)
Even if you consider that selling apps is not the carriers' business, it seems like they think it is... As far as I can remember, carriers have always tried to get hold on the content. They seem to hate the idea of being relegated to just "dumb data pipes". Even before the App Store craze, carriers had their own "decks" where they could sell ringtones, wallpapers and apps (well, actually, games). Handset makers and OS vendors App Stores disrupted the control carriers had over content (and the associated revenue).
That's also the same situation on fixed Internet market BTW: triple play technologies have enabled Internet providers to get a cut of the TV content distributed through their "pipes"

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Even if you consider that selling apps is not the carriers' business, it seems like they think it is... As far as I can remember, carriers have always tried to get hold on the content.

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Another subject where I disagree with you is when you dismiss the comparison between carriers and handset makers/OS vendors

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Available for Consulting and Speakerships

  • Available for Consulting & Speaking
    Tomi Ahonen is a bestselling author whose twelve books on mobile have already been referenced in over 100 books by his peers. Rated the most influential expert in mobile by Forbes in December 2011, Tomi speaks regularly at conferences doing about 20 public speakerships annually. With over 250 public speaking engagements, Tomi been seen by a cumulative audience of over 100,000 people on all six inhabited continents. The former Nokia executive has run a consulting practise on digital convergence, interactive media, engagement marketing, high tech and next generation mobile. Tomi is currently based out of Hong Kong but supports Fortune 500 sized companies across the globe. His reference client list includes Axiata, Bank of America, BBC, BNP Paribas, China Mobile, Emap, Ericsson, Google, Hewlett-Packard, HSBC, IBM, Intel, LG, MTS, Nokia, NTT DoCoMo, Ogilvy, Orange, RIM, Sanomamedia, Telenor, TeliaSonera, Three, Tigo, Vodafone, etc. To see his full bio and his books, visit www.tomiahonen.com Tomi Ahonen lectures at Oxford University's short courses on next generation mobile and digital convergence. Follow him on Twitter as @tomiahonen. Tomi also has a Facebook and Linked In page under his own name. He is available for consulting, speaking engagements and as expert witness, please write to tomi (at) tomiahonen (dot) com

Tomi's eBooks on Mobile Pearls

  • Pearls Vol 1: Mobile Advertising
    Tomi's first eBook is 171 pages with 50 case studies of real cases of mobile advertising and marketing in 19 countries on four continents. See this link for the only place where you can order the eBook for download

Tomi Ahonen Almanac 2009

  • Tomi Ahonen Almanac 2009
    A comprehensive statistical review of the total mobile industry, in 171 pages, has 70 tables and charts, and fits on your smartphone to carry in your pocket every day.

Alan's Third Book: No Straight Lines

Tomi's Fave Twitterati