BARCELONA, Spain—Much of the discussion here at this year’s Mobile World Congress trade show has centered on the increasing amount of competition among the U.S. wireless carriers, as highlighted by the push in the past few weeks toward unlimited wireless data plans. However, I suspect that we ain’t seen nothing yet, considering the two largest smartphone vendors in the world will soon each release their next hotly anticipated device—and both vendors clearly have something to prove.
But first, let’s talk about the unlimited avalanche. February 2017 marked the complete and total return of unlimited data to the U.S. wireless market. T-Mobile and Sprint have long offered unlimited data options at various price points, but T-Mobile last year went “all in” on unlimited with the launch of its T-Mobile One plan (a plan that now represents the only real pricing option from T-Mobile).
T-Mobile’s bet on unlimited may have been the final straw for Verizon, which itself launched its own unlimited data plan earlier this year (but only after the executive who proclaimed that “you cannot make money” with unlimited video retired). Not to be outdone, both AT&T and U.S. Cellular both launched their own unlimited data offerings. AT&T even dropped the prices for its unlimited service only days after first introducing it, just to make sure it would be competitive in the space.
Unlimited data is back, in a big way.
But the real fireworks in the wireless industry likely won’t start until this fall. That’s when Apple is widely expected to begin selling the iPhone 8, a device that the Wall Street Journal has reported will sport a new design with a curved display and another new charging port, among other features. Apple’s 2017 iPhone will also stand as the 10th iteration of the gadget, an anniversary that will likely represent yet another test of Tim Cook’s leadership and vision for a company that some critics have argued is no longer as innovative as it once was.
Meaning there’s a lot riding on the iPhone 8.
And the iPhone 8 ought to arrive shortly after Samsung begins selling its own Galaxy S8, a device the company is widely expected to announce at an event in New York scheduled for March 29. Like Apple, Samsung has a lot riding on the launch of the S8 as the company works to recover from the disaster that was the Galaxy Note 7 recall. That may well be why Samsung this year decided to forgo its annual Galaxy S-line launch at Mobile World Congress in favor of its own, branded event. (Meantime, Samsung’s top executives in Korea continue to face charges of bribery and embezzlement.)
Together, Apple and Samsung control the bulk of the world’s smartphone market, making their pending smartphone launches a key event in the wireless industry’s annual calendar. And since smartphone replacement rates in the United States have slowed in recent quarters—likely due to the relative dearth of innovation in the handset arena—there may well be pent up demand for new redesigns from the world’s top smartphone vendors.
What this means for Verizon, Sprint, AT&T, T-Mobile and the rest of the nation’s wireless network operators is that the fall of 2017 could represent the best opportunity to steal market share in years. iPhone launches, as well as other major smartphone launches, often spark much higher levels of customer switching as wireless users shop for the best deal on their desired device. Indeed, during the launch of the iPhone 7 last year, U.S. wireless operators launched “unprecedented” promotions for the device, basically giving it away to anyone who promised to stick around for two years.
This year, the battle may be even hotter thanks to the rise of unlimited wireless data. Now there’s relatively little sunlight between the service plans from the nation’s top wireless operators, meaning they’ll have to pull out new promotions, accessories, service offerings or other charms to retain existing customers and entice new ones.
What might these promotions look like? For AT&T, those charms will likely center on video offerings like its DirecTV Now service. For Sprint, they could involve its ongoing network upgrade program and faster speeds, or maybe more free Wi-Fi. Verizon could leverage its Go90 service or its own FiOS internet offering, while T-Mobile likely has an Uncarrier announcement timed specifically around the launch of the iPhone 8 or the Galaxy S8.
While much of the noise here at MWC has centered on 5G and the internet of things, I suspect many backroom meetings at the show are focused on more pressing, timely matters—like what to do about the 8s. — Mike | @mikeddano