Opinion: Does iPhone OS 4.0’s VOIP Functionality Hint At The End of Cell Phone Minute Plans?



OPINION: The scuttlebutt was pervasive and we all hoped it was coming, so when Steve Jobs announced iPhone OS 4.0 multitasking at today’s event, it was more a pleasant confirmation than a surprise. It may have more than surprised Apple’s mobile partners, though: the addition of background VoIP functionality will, at the very least, finally force wireless carriers like AT&T to compete with companies like Skype on their own networks.

While Apple’s approach isn’t really true multitasking — apps still aren’t running concurrently, they’re just offloading some functionality to the system in exchange for the appearance of always being on — it’s the choice of functionality that is so smart here: Apple has very intelligently chosen a handful of APIs that, combined with built-in OS state saving, simulates multitasking for 99% of apps without draining the battery. Apple picked the functions that matter for the appearance of multitasking. F

For example, apps can now play audio in the background, which allows audio streaming apps like Pandora and Spotify to finally be viable. Apps can also now notify the user through local alerts of events like new messages or completed tasks: push could do this before, but push is also a spontaneous and erratic beast that often fails when it’s needed most.

That’s all well and good, but it’s the VoIP functionality that really changes things. In my opinion, it signifies a major shift in the way wireless carriers will be billing iPhone users: with the addition of background VoIP processes, the majority of iPhone users can now totally ignore their text message quota or minutes, sign up for a $10 Skype number and do all their telephoning through VoIP. With iPhone OS 4.0, your AT&T subscription is basically landing you a data pipe, and you can safely ignore everything but the 3G connection and your Skype account as an overpriced, fall-back emergency measure.

That’s huge. Presumably, Apple’s wireless partners were aware of this, but if they weren’t, they’ve got to be sweating: Apple just forced them to truly compete with much cheaper and more affordable VoIP services on their own networks. The only way they’re going to be able to compete is by dropping the all-you-can-eat data plans they’ve been offering and replacing them with tiered data plans… something AT&T’s already been hinting at. Drop the minutes and roll out a Skype-like VOIP service of their own, and AT&T’s just got no reason to sell you a minute plan.

It could be a major shake up… and it makes me wonder if Apple’s vision of the future of the iPhone isn’t actually the iPod Touch 3G. With iPhone OS 4.0, all the iPod Touch needs to replace the contracted iPhone in most people’s pockets is a 3G micro-SIM slot, like the iPad has.

Could AT&T be more forward looking than we think, and — with their month-by-month data pricing — realize that the future of cell phones is just mobile broadband? Could they now be preparing to just sell you the data pipe? Could this be a grand conspiracy between Apple and its wireless partners to transition the entire cellular business?

Time will tell, but if the likes of AT&T aren’t already on board… Apple’s got a vision of the future radically different than that of its wireless partners. If it shakes out the way Steve Jobs wants, that’s a very good thing for anyone who’s ever signed a two year cell phone contract just to get an iPhone.


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