Mobile Net Neutrality will be the kingmaker of Apple versus Google.

In my post last week about whether Samsung should buddy up with the wireless carriers, one of the main points is important enough to warrant its own post. That point was: forget Apple, Google, Samsung and all the rest: the biggest, meanest tech giants in town are actually the wireless carriers. Over the last ten years, we’ve watched the mobile ecosystem grow into an enormous, sprawling whole new world of operating systems, smart devices, networks, apps and stores to sell them; yet surprisingly few people have raised a slightly worrying finger to mention: “Hey- everyone remembers that we’re building all of this on top of, and critically dependent on, the wireless providers’ spectrum, right? And the bigger this ecosystem gets, the more leverage we’re giving the carriers over the traffic, content and fees associated with using our mobile devices, right? Is everybody ok with this?”

That is, until earlier this year- when T Mobile announced a new feature for its customers: Unlimited Music Streaming! Wait, what? That sounds like a good thing! That’s right: from now on, all data used in certain music streaming apps won’t count towards the user’s download cap. Sounds like a pretty cool feature, and it is: until you think about it a little bit, and realize that this feature pretty much marks the definitive, opening volley in the looming mobile net neutrality war. T-Mobile’s initiative is passed off as a benefit, not a restriction, but its clear secondary consequence will inevitably be to put all of the non-preferred services (read: the ones that don’t make the bar for the download cap bypass) at a crippling disadvantage. End result: good for the big incumbents at the top, bad for new entrants and therefore bad for consumer choice in the long run. T-Mobile has been very smart about spinning this as a great thing for consumers, but the net neutrality advocates have wasted no time in warning us that this marks the start of a very, very bad thing. And I guess they’re right, although in my view there’s little use in crying to the FCC. The mobile carriers own that spectrum, and if you want to use it you’d better be ready to play by their rules. Sorry.

Now here’s what I think: Mobile Net Neutrality is going to be a big deal, yes. But it’s going to extend far beyond preferred access to apps and bypassed download caps for streaming services. In fact, I’m going to make a prediction right now:

Mobile Net Neutrality will be the main front of the Apple versus Google war over the next five years.

That’s a bold prediction, so let’s unpack it a bit. Apple and Google both know all too well that the future of the Internet is on mobile devices, and both have heavily invested in cloud services and architecture for iOS and Android moving forward. But they’ve done so in very different ways: for Apple, the iPhone is the focal point and the cloud is just dumb storage, whereas for Google the phone is dumb glass and the cloud is where the magic happens. (I really love this analogy; thanks Ben Evans.) Meanwhile, we’ve seen the rise of tweaked and forked versions of Android that show off Android’s versatility and potential across a broad range of devices, while Apple keeps a tight lid on the iPhone rollout and iOS release schedule. So what does this have to do with Net Neutrality?

As I mentioned last week, it’s not a bad bet that within a few years the wireless carriers will start to flex some muscle and decide who, exactly, they want playing in their sandbox. It’ll be brutal, and it’ll look like this:

  1. The carriers announce various versions of ‘The UltraHighSpeedGold package’, allowing privileged ultra premium spectrum access and ultrafast connection speeds to users of select qualifying devices and premium long-term contracts. (Remind anyone of the T-Mobile announcement?)
  2. ‘Select Qualifying Devices’ turns out to be ‘which OEMs are willing to cough up the biggest ‘preferred special access’ fees and concessions? (read: Samsung!)
  3. The wireless companies can now play kingmaker at will over which devices, operating systems, and contracts they care to allow UltraHighSpeedGold access, and which ones are stuck with regular bandwidth and download caps.
  4. As iOS and Android become more and more integrated with the cloud, having lightning fast connection speeds won’t just be a luxury: they’ll be critically important for the phones to be able to work at all. UltraHighSpeedGold access won’t just be a nice bonus feature: it’ll be the difference between a functional user experience and an unusable device.

It’s not hard to see who is in a far more vulnerable position here. Apple has kept their offerings tightly restricted to a very small selection of phones and only one version of iOS, and kept as much of the iOS magic as possible running locally on the device. Meanwhile, Android is being forked and tweaked all over, and in every case is critically dependent on having a fast, reliable connection to the cloud where all of the Android Magic happens. If the carriers start picking favorites, throttling data, and un-leveling the playing field, it would be disastrous for Google- and by extension, great for Apple.

It has not gone unnoticed that while Google has made a big public show of opposing ISP net neutrality, Apple has stayed very quiet– playing right into the convenient narrative of ‘Google wants the internet to be open and free, while Apple wants to control your stuff and keep everything perfect’. But let’s make no mistake here: Google is looking after its own skin, and Apple smells blood in the water. If I were Larry Page, this prospect would terrify me. T-Mobile making a splashy announcement about music streaming may be a great perk for everyday users, but it might turn out to have exposed a hole in Google’s armour with very, very problematic implications for the future of Android. It’s been said before that Apple’s best weapon against Google may be a divide-and-conquer strategy. I’m ready to bet they won’t need to: they’ll let the wireless carriers do it for them.

Although the prospect of spectrum throttling paints a very dark future for Android, Apple may not necessarily be leaping towards a sure slam dunk. If wireless net neutrality laws do get passed, or the carriers decide they’re happy with the ecosystem the way it is and opt not to play kingmaker, then Apple may simply find itself smothered by the sheer volume of Android devices hitting the market, especially in the developing world. In the long run, unless the carriers suit up to war in Apple’s favor, it’s hard to bet against the cheaper, open ecosystem with a larger global footprint. I guess it all comes down to this: Apple needs the carriers to punk Google hard; Google needs them not to. And mobile net neutrality will be the deciding issue that sways them in one direction or the other.



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