Thursday, March 28, 2002
What Price Wireless Apps?
Posted by Jason Dunn in "NEWS" @ 08:16 AM
http://www.pcworld.com/news/article/0,aid,91604,tk,dn032702X,00.asp
Just when you think wireless data charges are too high to swallow, the carriers are talking about how to charge you for using applications on your phone while disconnected! This is a very bold move by the carriers, one that will be met with almost universal loathing. Who wants to pay 25 cents every time they play a simple game or read news offline? If you buy an application, you should be able to use that application whenever you want - not keep paying for it. What if it cost us 25 cents every time we opened Microsoft Word? Microsoft might like it, but most people would stop using Word - the TCO would skyrocket. This attempt by the carriers to extort more money from their victims will flop in a huge way. People are willing to pay a small amount to communicate with others (SMS), but not to play a game on their phone. Comparing a tiny, low-res B&W screen on a phone with awkward controls to an arcade game is silly - the two simply don't compare.
"The prime example of value-based pricing is in Europe, where carriers charge 10 cents per SMS message. With the rise of J2ME applications that are small enough to reside on the cell phone, however, the problem has become how to charge users who are not connected to the network and who access an application only locally on the handset.
Sprint and others seem to have overcome the problem of charging for offline use. Sprint calls its solution BOBO (billing on behalf of others) and is currently testing this and various other pricing schemes, said Nancy Sherrer, a Sprint spokesperson based in Overland Park, Kansas. Sprint will offer value-based pricing schemes with its applications in the second half of this year when it launches its third-generation network, Sherrer said. By placing a counter in each application--even if a user is playing a game on the handset while flying coast to coast, or if a salesperson is checking an SFA application for an address offline--Sprint can charge for usage.
"Think of it as gong to an arcade and paying 25 cents for a game. It's the same experience," Sherrer said."
Just when you think wireless data charges are too high to swallow, the carriers are talking about how to charge you for using applications on your phone while disconnected! This is a very bold move by the carriers, one that will be met with almost universal loathing. Who wants to pay 25 cents every time they play a simple game or read news offline? If you buy an application, you should be able to use that application whenever you want - not keep paying for it. What if it cost us 25 cents every time we opened Microsoft Word? Microsoft might like it, but most people would stop using Word - the TCO would skyrocket. This attempt by the carriers to extort more money from their victims will flop in a huge way. People are willing to pay a small amount to communicate with others (SMS), but not to play a game on their phone. Comparing a tiny, low-res B&W screen on a phone with awkward controls to an arcade game is silly - the two simply don't compare.
"The prime example of value-based pricing is in Europe, where carriers charge 10 cents per SMS message. With the rise of J2ME applications that are small enough to reside on the cell phone, however, the problem has become how to charge users who are not connected to the network and who access an application only locally on the handset.
Sprint and others seem to have overcome the problem of charging for offline use. Sprint calls its solution BOBO (billing on behalf of others) and is currently testing this and various other pricing schemes, said Nancy Sherrer, a Sprint spokesperson based in Overland Park, Kansas. Sprint will offer value-based pricing schemes with its applications in the second half of this year when it launches its third-generation network, Sherrer said. By placing a counter in each application--even if a user is playing a game on the handset while flying coast to coast, or if a salesperson is checking an SFA application for an address offline--Sprint can charge for usage.
"Think of it as gong to an arcade and paying 25 cents for a game. It's the same experience," Sherrer said."
