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Explainer: What 'Open' Cell Phone Networks Mean For Your Small Biz
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By Rich Karpinski

Cellular networks, especially in the U.S., have historically been closed environments. Meaning: cellular carriers tell you what phones you can use, often what applications and services you can run, and definitely at what contract ($) terms.

But suddenly, "open" cell phone networks and devices are all the rage. What the heck does that mean and how can it benefit your small business?




The Open Trend

So who's going open?

- Google started a lot of discussion with Android, its open source wireless software project that it believes will eventually give users much more choice in the applications they run on their phones (much like today's PCs)

- Verizon Wireless followed suit, declaring that its network would soon be opened up -- meaning it would allow any device or application to run on its network

- AT&T jumped on the open bandwagon as well -- though exactly how it has suddenly become more open isn't entirely clear.

- The FCC auction of new wireless spectrum in the 700Mhz range is also fueling the open wireless debate. As part of the auction process, Google browbeat the FCC into ensuring that at least part of the available spectrum would operate under "open access" rules.

So What Does All This Mean?

Chances are, today you buy your small business a cell phone by going into a store, choosing from the available phones and signing on for a contract in order to get the price on the ticket.

All of this "locks" you into the carrier in a number of ways. You have to use the phones they certify, the applications they put on the device, the services they offer through their network and under the terms of the contract you sign (and which you can't void without paying a hefty fee). You typically can't use the phone on other networks (though there are SIM card exceptions) and until recently even your phone number was tied to your wireless carrier.

In this new more open world, all of that (theoretically) changes. Imagine purchasing a phone at Best Buy or Amazon.com -- the perfect phone for your needs. You then take that phone to any carrier you want and sign-up for service. If you like, you can take the phone to a second network, for instance, when you are out of town or more likely out of country. When you get the phone home, download all of the applications you want via the Web, mixing and matching just the software you need.

Sounds great, right?

Well, there's a few caveats. The phone purchase is likely to be quite a bit higher, due to the lack of carrier subsidies supporting your "unlocked", more open handset. And the services you end up buying from your carrier may be a la carte and pay-by-the-bit, which means you'll need to be smart about what you sign up for and careful about how you use your phone.

Find this "advance" unappealing?

Well, carriers will likely continue to offer phones under today's terms as well -- tied to their networks, locked into a contract, filled with their apps and services, but easier on the pocketbook.

The great thing: it will be your choice which route to take.

Which path do you see your small biz taking with their future wireless purchases? Let us know.

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