Sonera and iPhone: why esclusivity is not good for consumers

Sonera Finland is the only operator with rights to distribute the new Apple iPhone 3G in Finland. And this is not good for Finnish consumers.

Sonera is offering 3 different pricing levels (small, medium, large) for the iPhone+service combination. They also offer an extra option that gives people the chance to personalize more the subscription package they are buying from. As part of the deal the customer gets an iPhone at a certain price that depends on the package and the model (8 or 16 GB), but in all cases the phone will be operator locked so will not work with any other operator service than Sonera.

The agreement is 24-month long and with an iPhone 16Gb the basic level (called Small) it costs 31.69 Euro a month plus 245 Euro for the device. Over the entire duration of the deal the total cost will be 1005.56 Euro. The customer isforced to use Sonera cellular service as long as she wants to use the iPhone that came with it.

The basic package is pretty lame. It includes 100 minutes of voice calls, 100 SMSs and a ridiculously low 100 MB of data transfer. Maybe that is OK for browsing but once one starts streaming video or downloading podcasts, the data cap will be easily reached. The extra charge for the data over the limit will be 1.49 Euro/MB. Sonera offers free access to their WiFi service in Finland but with a 3G device supporting high speed downloads, one just wants to feel free to use it anyplace and anytime.
There is an option to go for the more expensive packages. The package "Large" includes 1GB a month of data transfer but comes at a 89.99 euro a month + 85 Euro for the iPhone. Total over 24 month period: 2244.76 euro!

When considering that operators in Finland are already offering unlimited data plans starting at 9.99Euro, I wonder why Sonera did not offer that at least on the more expensive packages. Asking customers to make a 24-month commitment on these conditions just to get an operator locked device seems quite unreasonable to me.

Operator locked means also that all people who are not Sonera customers will be left out of the possibility of using an iPhone in Finland. I guess non-sonera customers account for at least 50% of the Finnish population of cellphone users, and that is quite a big group.

Exclusivity agreements are not good for consumers. Like in this case, they often end-up with customers paying more or being left out from the possibility of getting something they would want.

Twitter drops feature, becomes less mobile.

Twitter has communicated that they have disabled their sms notification service for users outside of North America and India. This is obviously bad news for people like me who have been relying on sms as the way of giving more visibility to some people I follow on the service by getting their updates and direct messages delivered instantly and directly to my mobile.

I have been wondering for a while how long they would have been able to pick up the sms costs as no new agreements with operators were announced since last year and no revenue generating features were added to the service.

Twitter has justified this change with costs (up to 1,000 USD per user per year). I think that is understandable and acceptable, but it is a cold shower for users who found value in this feature. It is always hard to remove free features from services, almost as hard as changing the business model and making users pay for that feature.

Maybe twitter could have tried (and maybe they have tried) to find ways to monetize this feature indirectly by attaching adverts to the SMS notifications the same way as full RSS feeds are nowadays distributed. How would have users reacted to it? And would advertisers go with it? How would that have impacted the cost structure and level?
Another option they could have tried is making users pay for it, but again that is easier said than done.

Anyway, I will keep using twitter and I am still looking for a replacement solution to this feature. Checking the m.twitter.com on regular basis does not work too well, you cannot access direct messages via it and you cannot select specific friends you follow and look them up their feed. Mobile email is a partial replacement (I have gmail inbox configured on my E71, twitter forwards direct messages to my email inbox). I also tried twibble (a java app for mobile) but did not particulary like it as it is an overkill compared to what I need...so I am still without instant mobile twitter notifications.