Recently, a number of news stories have been complaining about the wireless industry. We are told that consumers:
- Don't want long-term contracts when they sign-up for wireless phone service;
- Don't like early termination fees when they want out of their contracts;
- Don't like the fact that the Apple iPhone is only available from AT&T; and
- Need the protection of new "net neutrality" government regulations.
We are further told that the main problem is that—brace yourself—there isn't enough competition in the wireless business.
Huh?
Consumers are, in fact, inundated with advertising by wireless companies, suggesting that there is VIBRANT competition in the wireless business. Not only can consumers choose from among dozens of different phones and from several different wireless companies, but they can even sign up with a German company (T-Mobile) if they like.
Wireless stores are on virtually every corner and in almost every shopping center. If you can't find the phone you want at the store you're in, you can probably cross the street and get it—and you may even have to wait in line.
Consumers can choose the lengths of their contracts, and from among many different calling plans. They can decide whether and how they want to pay for options like text messaging. And now, wireless companies are announcing their intentions to make their networks available to any device, so long as it is in technical compliance with the requirements of the network.
Looking at what’s happening in the wireless marketplace, it doesn't seem that the companies are out of touch with consumers. Rather, it’s the so-called consumer groups that are out of touch.
When the European Union, at the behest of such consumer groups and Microsoft's competitors, insisted that Microsoft was harming European consumers by bundling Windows Media Player with the operating system, the EU demanded that Microsoft provide a copy of Windows without the Media Player included. Microsoft did, but consumers didn't buy it.
Similarly, every wireless company will sell you a wireless phone without any contract at all, if you're willing to pay the retail price of the phone. And, much like copies of Microsoft Windows without the Media Player, almost no one chooses that option. Consumers choose to have the cost of the phone amortized over the lifetime of the contract, just like they wanted the full version of Microsoft Windows.
Who speaks for consumers? Certainly not a company's competitors, and all too often not those so-called consumer groups.
No, consumers speak for consumers, through the choices they make in the marketplace.
And based on how consumers are responding to the wireless industry, they’re happy with those choices.