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Bryan M. Wolfe
| May 26, 2013
The AppAdvice Week In Review: AT&T's New Fee, Yahoo's Next Target And WWDC
Tomorrow is Memorial Day in the U.S., making this the first unofficial weekend of summer. Before heading to a picnic or other holiday event, here are some of the stories that made news during the week that was.
The countdown to WWDC 2013 continuesIn two weeks, the technology world will meet in San Francisco for Apple’s annual Worldwide Developers Conference. The event will kick off with the keynote address on Monday, June 10, and will likely focus on new software such as iOS 7, and OS X 10.9. We have our own ideas regarding what new products and/or services should be announced at WWDC. In our second of a four-part series, we said that we'd like to see Apple reveal a second-generation iPad mini, and an iRadio service powered by Beats. In addition, we offered some suggestions for iOS 7. One possible product that could launch in two weeks is the so-called "iWatch." Long-rumored, prototypes of the wearable device are said to be going through the testing stages ahead of WWDC. However, another report concluded that the iWatch wouldn't arrive until 2014. Who's right? We'll find out soon.
It's only $0.61, right?[caption id="attachment_420739" align="aligncenter" width="565"] What's this?[/caption] AT&T is charging customers a little bit more for cell phone service. Since May 1, the second largest carrier in the U.S. began charging customers a monthly $0.61 administrative fee. The new “Mobility Administrative Fee” applies to consumer and Individual Responsibility User (IRU) lines. The fee appears with taxes and other surcharges at the bottom of a customer’s phone bill, below the service charges. Not a big deal, you say? The Wall Street Journal says that this fee could “bring in more than a half-billion dollars in annual revenue to the telecom giant.” As previously noted, one of the best quotes regarding AT&T’s new administrative fee comes from Joe Hoffmann, principal analyst at ABI Research:
But why 61¢, why not $1 or $5 or $10? Because AT&T understands price elasticity of demand. When AT&T raises the price by 61¢, they know hardly anyone is going to bail on them, and so can impose this with impunity. $1 or $5 or $10 is just too much to swallow all at once, but give them time. For now, $500 – $600 Million will flow right to the bottom line. Brilliant! No fancy software tools, no focus groups, no high priced engineers and programmers, and no iPhone subsidies. Just a raw, brute force price increase. In six to 9 months, add another fee, then rinse and repeat a few more time. Marketing beats engineering every time!He’s completely right, don’t you think?
Yahoo buys Tumblr. Is Hulu next?[caption id="attachment_420722" align="aligncenter" width="460"] Yahoo CEO Marissa Mayer[/caption] Yahoo approved a massive $1.1 billion cash deal to buy the popular microblogging and social networking website, Tumblr. This acquisition follows Yahoo purchases of Astrid, and Summly made earlier this year. However, Yahoo might not be done yet. By the end of the week, reports surfaced that the company was interested in buying Hulu. If this happens, the once-maligned company could become a huge player in the growing streaming video marketplace.
Recommended Reading for May 26, 2013[caption id="attachment_420725" align="aligncenter" width="605"] Tim Cook[/caption]
- Apple Further Develops Maps App Flyover, Improves Support For California by Joe White explains how iOS 6 Maps is getting better.
- Who Says You Can't Access Google Play Music All Access On iOS? You Can With gMusic by Aldrin Calimlim announces some good news for Apple fans who want to use Google's new streaming music service.
- Tim Cook Goes To Washington And Gets An Earful Over Apple's Tax Policies by yours truly shows that the Apple CEO held his own against some of the U.S. Senate's biggest mouthpieces.