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Apple just became an MVNO

, posted: 13-Mar-2010 08:00

Further details have just been released by Apple on how the 3G service will work on the iPad in the U.S. and it represents a paradigm change in mobile network usage. I don't think it is too much of a stretch to say that with the iPad Apple has effectively become a data MVNO (mobile virtual network operator), at least in the U.S. Whether they take a cut or not on the data plan they are managing the overall experience in a very elegant way from the users' perspective. The 3G service becomes part of the 'Apple' experience rather than an iPad on AT&T.

We already knew that there would not be any contracts on the data bundles meaning that AT&T will not be subsidising these devices to reduce the device cost and lock in customers. That's OK for AT&T given they are the only network supporting Apple products in the U.S. 

We also knew the pricing - US$14.99 for 250MB (OK) and US$29.99 for Unlimited (awesome!). I think we are all interested to see if 'Unlimited' will have some sort of cap at say 5 or 10GB.

But what's really new is how the user interacts with their 3G service. All functions (activating, payment, changing plans, deactivating) are managed from the iPad itself using a 3G manager application. You also get usage stats on how much data you have left if you have the 250MB bundle and pro-active usage alerts - excellent!

These functions must have quite a strong tie-in to the network operator to enable payment, provision the service and extract these usage details. So what's incredible is that there does not appear to be any reference to AT&T in this 3G application - the network operator is hidden and the user doesn't need to know who it is! It is not clear who the payment is with as it looks to be via credit card (rather than your iTunes account) but is that settled through Apple or directly with AT&T?

It will be fascinating to see how this model translates outside the U.S. where almost all countries (NZ excepted) have multiple iPhone provider networks. Will every operator that wants to support the iPad need to work with Apple to provide the approved pricing plans and network integration? Will the iPad only work on such approved networks?

[Edit May 5th: It looks like Apple is taking a very open position with the iPad on 3G. Going by this post from iPhone New Zealand the iPad will accept any SIM card and all you have to do is enter the APN details. As the iPad is launched in more countries I would expect the iPad to detect the SIM card and auto-fill the APN field.]

Other related posts:
Brands producing apps only for iPhone
Steve Jobs: Rock Star!
The features Kiwis miss out on with Android 1.6

Permalink to Apple just became an MVNO | Add a comment (6 comments) | Main Index

Comment by gopher, on 16-Mar-2010 15:55

Will be VERY interesting to see how this translates to NZ!! May be why countries such as NZ haven't made it onto the release schedule yet (as they probably haven't even started negotiating with the providers here).

Given that Vodafone still have exclusivity on the iPhone, but the XT data network probably suits the iPad better (using 850 instead of 900MHz) it will be fun for Apple to sort out!

It also means that my idea of buying an iPad in the US and then using it here may not be quite as easy as I thought. Oh well, maybe I just save some cash and buy the WiFi only version ... 

Comment by andrewinwlg, on 31-Mar-2010 09:36

What happened to the article "iPhone still the best option for Telecom"?  I can see it from my RSS feed and from the geekzone search page, but the link just leads here!  Did it get deleted?

Author's note by timmyh, on 1-Apr-2010 10:35


It became clear to me that someone reading the previous 'iPhone' post might think I was reporting sales data that I was privvy to in my previous role.

While this wasn't the case at all and I had mixed data from a number of sources together, I wanted to remove even the perception that I was breaching any confidentiality.

So I rewrote the post to focus on the key underlying point that Android is struggling outside the US and that it will be challenging for Telecom to make a large Android play.

Comment by Arminius, on 4-May-2010 16:17

The iPad is not covered by the same distribution agreement as the iPhone agreement so anyone can order the device from a reseller - like you would a Mac or Apple software. The Vodafone iPhone contract is also not exclusive which is why Apple sells iPhones in competition to Vodafone on the NZ Apple store.

Author's note by timmyh, on 4-May-2010 16:28


The post was about the 3G information released by Apple for the U.S. anyway. It shows a very tight integration between the 3G data service management options on the iPad and the 3G network.

This is a great way of handling it by Apple but can only be achieved with a sophisticated interface to the mobile network. So either this solution is only for the U.S. or other carriers will also have to implement the Apple specification, which means they would have to be sanctioned by Apple.

Author's note by timmyh, on 6-May-2010 16:12

See the 'Edit' note above at end of the main post. Looks like Apple are leaving the iPad very open so it will work on any mobile network, but without the options to manage your mobile data plan from the device.

The more open it is the faster it will spread and the more users will use mobile data on it.  

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timmyh's profile

Tim Hayward
New Zealand

Former 'Head of Smartphones' at Vodafone New Zealand Marketing from 2006 to 2009. Looked after all key Smartphone platforms, mobile pricing plans, marketing and sales GTM activity.

Now working on mobile application development consulting and delivery especially on projects requiring support across multiple mobile platforms (iPhone, Android, BlackBerry, Symbian). Please contact me if you have any projects you'd like us to consult or quote on: tim@hayward.net.nz