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Verizon Wireless' decision to open up its network likely will mean more choices for gadget shoppers.
In many parts of the world, buying a cell phone involves a trip to an electronics store where consumers can pick whatever phone they want. Then they figure out which service provider they'd like to use.
Not so in the United States, where cell-phone companies exercise an iron grip on which phones are offered in the marketplace. Consumers first have to pick a cell-phone carrier and then buy a phone -- at heavily subsidized prices -- from the carrier. That has limited both the array of phones available in the U.S. and the features on those phones.
In recent months, a growing chorus of players -- consumers, regulators and big companies striving to break into mobile communications -- have sought to break down the existing system.
Google (GOOG, news, msgs) has led the way, unveiling an alliance of cell-phone companies, tech companies and handset makers this month to make new software available free of charge to power mobile phones. Google also pressured regulators to join the crusade.
Not all of the details are yet clear, but Verizon's (VZ, news, msgs) move likely will mark a turning point in the long push to open the U.S. wireless industry.
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What does Verizon's announcement mean for cell-phone users?
Consumers will be able to buy cell phones and other mobile devices sold by companies other than Verizon and use them on Verizon's network. It also means consumers will be able to get special cell-phone features and applications not offered by Verizon.
When will this go into effect?
The changes should go into effect in mid-2008.
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Verizon isn't offering any estimates, but because Verizon now subsidizes the cost of the phones it sells, consumers buying elsewhere may pay a lot more. The cost is likely to range dramatically, from inexpensive phones for less than $50 to top-of-the-line multimedia phones for $500.
Will I be able to use an old cell phone from another carrier like AT&T on Verizon's network?
Not necessarily. U.S. cell-phone carriers each operate on one of two different technical standards. Verizon and Sprint Nextel (S, news, msgs) use CDMA technology, while AT&T (T, news, msgs) uses GSM, the standard used in most of the world. Phones built to run on CDMA can't operate on GSM and vice versa, so an old AT&T phone, for instance, couldn't be used on Verizon's network. But it is possible that an old Sprint phone could work on Verizon's network.
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Change in the airwavesVerizon Wireless is handing consumers greater clout by allowing them to use their own phones on the carrier's network. The move could spur rival carriers to compete on pricing and service.
Not in its current form. The iPhone runs on a GSM network; Verizon uses CDMA technology. Unless Apple (AAPL, news, msgs) comes up with a new CDMA phone, iPhone users will be out of luck.
Will the new plan mean that I can use my Verizon phone in more places overseas?
Not unless more manufacturers introduce handsets with chips that run on GSM technology, which is used in many nations outside the United States, as well as CDMA technology, which Verizon uses. Some handset makers are starting to make these dual-mode phones, but they are still fairly rare.
Will Verizon's cell-phone plans cost as much if I'm using a phone I bought elsewhere?
Verizon is staying mum on pricing, but some analysts expect the company to charge more.
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Verizon's announcement talks about allowing outside "applications" on phones using the Verizon network. What does that mean?
Verizon decides which software applications, such as gaming and music services, it will allow on phones using its network. That has meant some applications designed by independent software developers haven't been available on a Verizon cell phone. Verizon's announcement changes that. Now any application that meets a new set of technical standards will be allowed on cell phones using Verizon's network.
What kinds of applications could become available?
Depending on how much leeway Verizon decides to give developers in drafting its standards, consumers could use Verizon's network to access a greater number of mobile video and music services, electronic books, payment and banking services, and location-based services that give the user information specific to where they are. Developers could charge for their services or offer them free with advertising.
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Verizon mentioned home appliances in its announcement. What are they talking about?
Verizon says its new policy will allow for unlimited innovation in linking devices and software to its network. They cite examples such as a digital camera being linked to a wireless network so that images could be uploaded to a Web page immediately.
Do other U.S. carriers have the same approach?
No. Other large cell-phone operators in the United States continue to sell select devices with approved features through their own retail outlets (and occasionally through a few partners).
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Verizon's customer service won't support the new features. That means consumers will need to troubleshoot with the makers of individual devices or software.
Verizon talks about devices that meet "minimum technical standards." How stringent are those standards likely to be, and will most current devices make the grade?
Verizon insists its standards aren't overly strict and says its goal is simply to be sure that no new applications or hardware will introduce bugs that could affect other customers.
Does Verizon intend to go the other way, too, and unlock phones that you buy from them to make them available to work on other networks?
Customers can already take phones they buy at Verizon and activate them on Sprint, which uses the same CDMA technology, though certain features may not be supported by Sprint.
This article was reported and written by Dionne Searcey for The Wall Street Journal. Jessica E. Vascellaro and Sara Silver contributed.
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