I take your point and am glad that you are thinking in terms of the
economics of the industry in the broadest terms, as am I.

Any company that wants to stay in business does r and d, however to get
people who will never use the additional services to pay for them is
unlikely to work for long in the face of corporations who don't.

The usual approach is to finance the differing strands of your business
separately - this is better for the corporation because it can spin off the
new business when necessary, this is how the phone cos dealt with the
internet and mobile phones for example. It's better for investors because
when they buy mobile phone shares they want to buy mobile phone shares not a
hodge-podge of businesses. This should maximise the value of the shares.

But the whole of this industry changes with the

That's fine too. Which is why companies that get it wrong should fail, and
those that get it right should prosper. What ultimately doesn't work is to
invest huge amounts of money in an infrastructure that only a minority of
customers will use and expect the broad mass of them to pay for it, whatever
happens!

Hmm, I see people want cheaper

The choices are very limited really, and there is a great deal of
convergence on prices in my opinion. Virgin are currently the most
commoditized network, but they are limited to using only one network,
T-Mobile and have limited access to services. The most important factor is
who has the largest network because by being on the same network as your
correspondents will reduce your mobile telephony costs.

you always have the choice of BA 1st class and RyanAir no class. All these
devices may have their uses I don't deny, it's just that they simply aren't
realistically what most users including myself will ever want, and yet we
are clearly subsidising new customers and new products. I appreciate the
fact that most of the cognoscenti on this group are keen fans of this
technology and attracted to the latest gadgets and an exquisite appreciation
of the differences between the plethora of tariffs ---- but  it just can't
be right to saddle the average user with the cost of developing these. If
you look at their annual reports of these cos, the business model that they
repeat again and again is that the same number of customers will pay more
and more for their mobile phone bills for services. This is just plain wrong
I think and yet another example of the Madness of Crowds.

Remember that there is limited access to bandwidth hence whoever limits it
is determining what kind of a market it is. Therefore there needs to be some
regulation to ensure that the customers (who have a genuine need to keep in
touch with each other basically) aren't too badly fleeced by the
quasi-monopoly.

I agree. Companies have an obligation to maximise their present value return
to shareholders, nothing more, nothing less. You might say that that
corporations' directors have a legal obligation over time to extract as much
profit for the shareholders from the markets in which they operate (and for
nobody else). But corporations often get it wrong as do consumers. And
consumers habitually get it wrong when they are misinformed as to
requirements and value by the suppliers, which is the usual state of play in
an expanding and new market. Mobile telephony for voice calls and texts just
aren't expanding any more in the same way so they are clearly vulnerable to
commoditization.  The price must drop but it isn't. OFCOM could assist this
process if they wanted to in several key ways.

Just because Pan Am went bankrupt doesn't mean you can't get a flight in the
US?

I will tell you a little story. I know a woman who is 77. She's had a stroke
a couple of years ago but she made a very good recovery, and for example
still drives. Her son insists that she has a mobile phone in the car so that
she can keep in touch with her. She will never use MMS, GPRS, mp3, download
a spreadsheet, or surf the internet  etc., she may occasionally call her
friends to say she is running late, or the doctor or the AA or whatever. She
may even send text messages, after someone has explained these to her for
the tenth time. Why should she, and the vast majority of the mobile phone
market who are like her, low usage and not high tech,  pay for other
people's toys?  However when she goes to buy a mobile phone she will be
offered a flimsy badly designed bit of c**p on which she can change the
polyphonic ringtone or play games, but which stops working if you drop it or
wet it, and (if she is lucky) an inappropriate PAYG tariff (she is
reasonably credit-worthy, has a pension and owns her own home) which will
provide her with expensive calls and an upfront top-up she may never use. Of
course, because it's expensive to use the phone, especially x-network,  she
never will, and it will probably end up flat or broken in the glove
compartment for when she really needs to use it. This is just plain crazy.

In other words why should the average airline passenger pay for BA's
overextended, overstaffed, and overserviced network? They don't anymore, of
course, and have by and large gone to budget airlines like Easyjet and
Ryanair, etc. when permitted to do so. The market in flights to say Paris or
Edinburgh is a commodity, and the brand of the airline is fundamentally
diminished. The same is inevitably going to occur in the mobile phone
industry for text or voice. Other services will continue to be developed,
offered and bought, but obviously are likely to have be funded from another
source, either the capital markets (that is, by going back to the investors)
or from the buyers of the new services. This is how all start-up businesses
have to do it, rather than from a captive cash cow.

As a result of investigating the mobile phone market over the past few
weeks, my hunch is that the average mobile phone user is in the process of
discovering just that: that he or she doesn't have to buy all the
unnecessary stuff that the phone companies want them to buy at an inflated
price, and will vote with their money if someone can provide them with what
they need, that's all.

My suggestions here, are I think, a fairly obvious assessment of what would
make an ideal mobile phone and mobile phone service provider for 99 pct of
the market.

Of course, the only way it will happen, is if enough people express
dissatisfaction with the current state of play.

Cheers
Fred