Imagine effortless internet. You're connected whenever you want, as fast as you want, and you never have to think about it. That's the dream of Qualcomm's "always-connected laptop" initiative, announced at the company's Snapdragon Summit on Tuesday.
Here, Qualcomm made a ballsy pitch: you can live without public Wi-Fi, perhaps even corporate Wi-Fi, and rely on LTE, where speeds are improving and are often better than Wi-Fi.
Qualcomm's perspective is not insane, but there's one roadblock: carrier service plans.
We've seen these always-connected laptop initiatives several times before. We saw it with WiMax circa 2008. More recently, LTE laptops have occasionally appeared, like Qualcomm's Gobi product line. By and large, though, consumers and businesses decided that built-in LTE connectivity just wasn't worth the added monthly fee.
"I believe that CEOs, CTOs, CIOs, C Suite personalities, will see this device we're building…and will look at that device as an opportunity to…decrease costs," Microsoft's Matt Barlow said at the Qualcomm event.
I'm not saying that's entirely impossible. But it goes against the entire history of how US carriers price and sell data. Office Wi-Fi, especially, involves a fixed cost for deploying routers and a single price for a broad pipe, to which you can attach as many devices as you want. The more devices you have, essentially, the cheaper Wi-Fi gets for each individual user.
LTE works the other way around. Because carriers charge by device, LTE only gets more expensive as you scale up. Small and large businesses alike find that LTE rates, even multiplied by only a few devices, quickly outpace the price of a Wi-Fi setup on a landline. Individual road warriors, meanwhile, will be comparing the price of LTE service to public, hotel and office Wi-Fi, which tends to be free for individual users.
Sprint Is Ready (Maybe)
There's one carrier rep here at the Snapdragon Summit: Sprint's technical COO Guenther Ottendorfer. He has said repeatedly that Sprint has enough capacity to take on all the unlimited data users who want to jump on board. (In part, that's because Sprint has struggled to attract smartphone users over the past few years.)
But is it ready for truly unlimited-data laptop users, at prices that can truly compete with Wi-Fi? At an afternoon panel, the moderator asked Ottendorfer just that, and he didn't really answer the question. He focused on how easy it will be to activate a new laptop with an embedded SIM and "the great value you get from these unlimited tariffs."
But as we know, the "unlimited" tariffs aren't actually unlimited; Sprint begins to deprioritize at 23GB, which is far less than the 190GB average monthly home internet usage in the US in 2016. That home usage number involves TVs, game consoles, and probably multiple PCs, but it still shows the high hurdle that service plans have to jump once they're being used for primary laptop internet access.
Does the Always-Connected Laptop Need 5G?
These PCs may really end up using LTE as a stopgap when Wi-Fi isn't available rather than a complete Wi-Fi replacement. An easy-to-activate LTE laptop, in that case, would work like an LTE iPad Pro, where people can turn the LTE on and off day by day, and mostly rely on cheaper Wi-Fi. But that's a much less radical vision than Qualcomm is portraying.
When I put this problem to Qualcomm CDMA Technologies president Cristiano Amon, he said that now that we've reached smartphone saturation, the wireless carriers are going to need laptops to keep increasing their subscription base, which means they'll need pricing that competes decently with Wi-Fi.
"I believe the operator understanding is that this is a very important growth opportunity for them, and that if they're not competitive with Wi-Fi … then they won't be able to generate that growth," he said.
He also said the new laptops are setting the stage for 5G, which is coming in 2019-2020. 5G will change the economics of networks by allowing new hybrid public-private networks, slicing networks so you can have different network subscriptions on one device, and merging Wi-Fi and cellular. Data will also be much cheaper per bit.
He's right: in the 5G world, the idea of truly unlimited, everywhere connectivity makes sense. Sometimes, that connectivity will be Wi-Fi, sometimes it'll be cellular, and ideally, you won't really know which one you're using. But first, you have to convince the carriers.
"While I understand this skepticism, I think the hard problem, which is the technology problem, has been solved. Now it's a business model evolution which leads us to what's going to happen on a larger scale in 5G," Amon said.
It'll take a true "uncarrier" to come up with some service plans that will attract Americans to these PCs. Will any of our four big players step up?